France's Sarkozy defends self amid finance scandal

France's Sarkozy defends self amid finance scandal

The president said Labour Minister Eric Woerth, who is at the heart of the scandal, would keep his job in the government. But apparently bowing to public pressure, Sarkozy said he advised Woerth to resign from his contested second job, as the treasurer of their conservative UMP party.

Sarkozy, whose poll ratings have slipped to his lowest point in three years in office, described the party financing allegations as a "campaign" against him.

Speaking to France 2 television in the garden of the presidential Elysee Palace yesterday, he steered the questions away from the scandal toward his efforts to modernise France, casting himself as a tireless leader willing to put himself on the line to save France from its untenable expectations about government social protections.

"When you carry out reforms ... you bother a certain number of people," Sarkozy said. "And the response is often slander."

Sarkozy is trying to win back voter support amid worries about a scandal involving the billionaire heiress to the L'Oreal cosmetics fortune that has destabilised the government, especially Woerth.

Politicians left and right had urged Sarkozy to respond publicly to allegations by a former accountant to L'Oreal heiress Liliane Bettencourt that she gave euro150,000 (190,000 dollars) in cash to Woerth, party treasurer, during the 2007 presidential campaign. The alleged sum would greatly exceed legal limits for campaign donations.

Sarkozy has denied the claims, which have not been proven. French prosecutors have opened a preliminary investigation.

The president has seen diplomatic successes from Libya to New York but barely a quarter of his compatriots support him, pollsters say. He has less than two years before 2012 presidential elections when he could face a surprising threat from the opposition Socialists, who are buoyed by his current troubles.

Sarkozy's interview gave him a sort of final word before the Bastille Day national holiday Wednesday and before many French head off on their summer vacations.

It also allowed him to explain to the French public why he believes the pension system must be reformed. Today, his government will formally present the plan, which includes raising the retirement age from 60 to 62.

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