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07/13/2010
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Sarkozy Strikes Back

French President Defends Himself Against Corruption Allegations

AFP/ France2

French President Nicolas Sarkozy answers questions from French television journalist David Pujadas at the Elysee Palace in Paris.

Dogged by accusations of corruption, French President Nicolas Sarkozy defended himself in a prime-time television interview on Monday night. He said that France has already wasted too much time on the scandal -- but the opposition isn't so sure.

After weeks of new revelations in a political scandal that has left the French media describing this summer as one of "panic" for the French president, Nicolas Sarkozy conducted a television interview on Monday night in an elaborate damage control effort. He sought to defend his government against serious corruption allegations and shift the national debate ahead of annual Bastille Day festivities.

The scandal, or " l'Affair Bettencourt," as it is being called in the French press, centers around Liliane Bettencourt, heiress of the cosmetics giant L'Oréal, who allegedly gave illegal political contributions to conservative politicians, including Sarkozy's 2007 presidential campaign. Prosecutors in France are currently investigating the claims as well as allegations that Bettencourt dodged taxes and possesses undeclared assets including a property in the Seychelles.

Broadcast direct from the terrace of Elysee Palace, the seat of the French presidency, Sarkozy answered questions posed by journalist David Pujadas of French public broadcaster France 2, who queried the president about the alleged tax evasion, conflicts of interest and illegal donations at the center of the scandal. A former bookkeeper for the L'Oreal heiress has alleged that Liliane Bettencourt and her now-deceased husband made illegal cash donations to conservative politicians, including €150,000 ($190,000) supposedly funnelled to Sarkozy's 2007 presidential campaign -- an amount far surpassing the €7,500 legal limit. The money is said to have been given to Eric Woerth, currently Sarkozy's labor minister and the chief architect of unpopular pension reforms.

The former Bettencourt bookkeeper, Claire Thibout, claimed last Tuesday that Sarkozy had received envelops stuffed with cash from the Bettencourts. A day later, however, she retracted that statement, saying: "I never said that Sarkozy was regularly given envelopes with cash." When asked about the allegations by journalist Pujadas, Sarkozy dismissed them as "lies" and "calumny."

"Can you imagine?" Sarkozy said. "I arrive in front of other guests and leave with cash?" But the president did admit he had attended two or three lunches or dinners at Ms. Bettencourt's home in Neuilly-sur-Seine, an upscale Paris suburb where the French president previously served as mayor.

Sarkozy also pointed to exculpatory statements made by other former members of the Bettencourt's staff, including the family's butler, who says he never heard anything about envelops filled with cash that had allegedly been given by the L'Oréal heirs to politicians.

'Eric Woerth Is an Honest Man'

He also noted that he had called for an official government investigation into the affair, while at the same time starkly defending Woerth. "Eric Woerth is an honest man," Sarkozy said of his labor minister. "He has my full trust." Sarkozy said that an official investigation by the General Inspectorate of Finance had already cleared Woerth on Sunday of any wrongdoing. "He is cleared of all suspicion, so there is no reason why I should get rid of him," Sarkozy said. He did, however, urge Woerth to step down from his role as UMP treasurer to focus on pension reforms, a step the labor minister said he would take on Tuesday.

Sarkozy had agreed to discuss the scandal for a maximum of 20 minutes of the hour-long prime-time interview. "France has lost too much time with this affair," Sarkozy said. "France has so many problems," he added, saying the country could better spend its time addressing issues like the national budget, the G-20 summit, austerity measures, revitalizing the economy, employment and security.

Members of the political opposition in France disagreed, noting that many critical questions remained unanswered, including a possible conflict of interest in the fact that labor minister Woerth's wife had worked for the company that manages Bettencourt's wealth.

Calls for Parliamentary Investigation

"(Sarkozy) created the impression, that he is the target of a conspiracy in order to deflect attention from difficult questions," Martine Aubry, the head of the leftist Socialist Party (PS) told public broadcaster France 3. She said the president was seeking to portray himself as a "victim." "What we expected this evening, like the rest of the French people, were clarifications and decisions: We got neither one nor the other," Aubry said. She repeated her party's demands for a parliamentary investigation.

The complicated Bettencourt affair began after Liliane Bettencourt's daughter, Françoise Bettencourt-Meyers, filed a legal complaint against family friend and photographer François-Marie Banier, who she alleged had taken advantage of her mother's frailty to secure gifts ranging in value between €600 million and €1 billion. A butler who was later fired by Bettencourt had secretly taped conversations between the heiress and her financial advisors in which she had allegedly discussed cash gifts. The butler then turned CDs of the recordings over to Bettencourt's daughter, who leaked them to the media. The contents of the CDs as well as subsequent claims made by bookkeeper Claire Thibaut have since pulled Woerth and Sarkozy's government into the scandal.

Are Pension Reforms Imperriled?

It remained unclear after Sarkozy's interview whether the president succeeded in shifting attention from the scandal. Equally uncertain are the government's prospects for pushing pension reforms through parliament in the autumn, following the Bettencourt scandal. The government approved lifting the retirement age from 60 to 62 on Tuesday, but it still faces a tough battle in parliament. Any additional negative developements in the Bettencourt affair would not be helpful.

Much is at stake for Sarkozy, who has made pension reforms a centerpiece of his presidency. Discontent is growing in France over the fact that Sarkozy became president on a pledge to modernize the country and to make it more transparent and effective. Instead, the reforms he pledged have come to a standstill and France's national debt has reached an astronomical €1.54 trillion. The president's public approval ratings have collapsed to an historical low.

If changes aren't made to France's pension system, it is estimated that the budget shortfall will swell to €42 billion by 2018. Most French are nevertheless opposed to the plan, with one recent poll stating that 63 percent are opposed to working any longer than they already have to. Three weeks ago, an estimated two million French workers turned out to protest against the proposed changes -- and more unrest is expected.

dsl -- with wire reports

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