French election debacle for Hollande

Marseille: French conservatives celebrated big gains in the local elections

President Francois Hollande's Socialists will fight the European elections bruised by big local election losses and bleak economic data.

Every politician thinks of "the next election". The Socialists will be happy to forget this latest one.

Last night they lost 155 towns, of some 500 they had controlled. "Punishment," read the front-page headline in the left-leaning Liberation newspaper.

The Prime Minister, Jean-Marc Ayrault, said he took part of the blame for the government's defeat. Prime ministers of France are always the lightning rod for criticism, but this valiant attempt to deflect focus from the president, won't hide the real issue. Francois Hollande is failing.

The unemployment rate he pledged to reverse by the end of 2013 continues rising.

The number of jobseekers without any work rose by 31,500 last month, one of the biggest monthly increases of the past year. The overall number - including those working part-time - is almost five million.

Today it was announced Mr Hollande's government missed the deficit target of 4.1% it had promised EU partners it would meet. It must cut deeper.

Higher taxes (which some on the left have labelled "punishment" of the rich) seem to be scaring employers away. According to the UN, foreign direct investment in France fell by a staggering 77% last year.

Mr Hollande's government must find a response.

Prime Minister Ayrault accepted part of the blame for the Socialists' losses

That "next election", the European election, is less than two months away - with the National Front (FN) and conservative UMP neck-and-neck in the polls.

Both had reasons to celebrate last night. The FN took a record 14 (possibly 15) towns, while the UMP took the other 140 towns the Socialists had lost. Good news for the UMP leader, Jean-Francois Cope, who has laboured in the shadow of the departed Nicolas Sarkozy.

FN leader Marine Le Pen, not surprisingly, is also focusing on "the next election".

"It will be a political earthquake," she told me. "A resurgence of patriotism and sovereignty across Europe."

In Socialist ranks there will be much soul-searching today. But it was the opposition leader Mr Cope who echoed the voice of the disgruntled voters we interviewed at the polls.

"The real question is: what does Francois Hollande want to do with our country?" he said. "What people want more than anything else is a sense of efficiency, of results."

A government reshuffle is expected tonight.

Mr Ayrault is one of Mr Hollande's closest allies and a friend. But most believe he has already fallen on his sword. Interior Minister Manuel Valls is expected to replace him.

The government must present by 15 April a new plan to cut spending in line with EU targets - yet they also intend to lower labour taxes, to help France's embattled companies. Quite a juggling act.