July 12, 2010 / 10:14 PM / 8 years ago

Sarkozy tries to draw line under donations scandal

PARIS (Reuters) - French President Nicolas Sarkozy, trying to draw a line under a damaging furore over alleged illegal political donations, urged a minister at the centre of the affair to step down as treasurer of his ruling UMP party.

France's President Sarkozy, seen in this video grab from France2 Television, appears during a prime time news interview on France2 television in the garden of the Elysee Palace in Paris July 12, 2010. REUTERS/France2 Television/Handout

Sarkozy said Labour Minister Eric Woerth had been exonerated of any wrongdoing by an official report, had his full confidence and would remain in charge of a crucial pensions reform.

Asked whether he would fire Woerth, one of his closest political allies, Sarkozy said in a live television interview: “He is cleared of all suspicion, so there is no reason why I should get rid of him.”

But he said that to avoid any controversy, “I spoke to Eric Woerth and I asked him to devote himself exclusively to this important reform of pensions... My advice to him is to no longer exercise that responsibility (as treasurer).”

The president said he was determined to see through the unpopular plan to raise the retirement age to 62 from 60 and make people contribute longer for a full pension despite expected trade union protests in September, to prevent France entering a debt spiral comparable with Greece or Portugal.

He suggested the attacks on Woerth were aimed at torpedoing the pension reform, a key part of his government’s pledge to cut its deficit to within EU limits in the next three years.

Saying he would not be rushed into action, Sarkozy said he would reshuffle the cabinet only after the pension law was adopted in October, and would not decide until autumn 2011 whether to run for a second five-year term in 2012.

He went on prime time television to try to restore battered confidence hours after police searched the homes of France’s richest woman and her close friend in a scandal that has rocked his government and driven his approval ratings to a record low.

A former bookkeeper for L’Oreal heiress Liliane Bettencourt told police that the billionairess and her late husband made illegal cash donations to conservative politicians for years, including to Sarkozy’s 2007 election campaign.

The president was not asked directly whether his campaign had received such a cash donation.

The homes of Bettencourt, 87, and society photographer Francois-Marie Banier were searched amid calls for the appointment of an independent magistrate to investigate the case involving alleged illegal political donations and suspected tax evasion.

Sarkozy rejected any suggestion the public prosecutor in charge of the case, who is a personal friend of his, was biased.

“NEITHER DECISIONS, NOR CLARIFICATIONS”

Socialist party leader Martine Aubry, tipped by many to face Sarkozy in the 2012 presidential race, said the interview showed he was out of touch with the French people’s anger at the Bettencourt scandal and at high unemployment and insecurity.

“We expected this evening, like the rest of the French people, clarifications and decisions: we had neither one nor the other,” said Aubry, repeating calls for a parliamentary enquiry.

In all, police carried out seven raids on Monday, the public prosecutor’s office said. Witnesses said investigators were still combing a building adjoining Bettencourt’s villa in the exclusive suburb of Neuilly late at night.

The former bookkeeper has accused Woerth of taking an illegal 150,000 euro cash donation from Bettencourt’s wealth manager, both of whom have denied this.

The Finance Ministry’s tax inspectorate concluded in a report rushed out on Sunday that Woerth had not intervened in the tax affairs of the Bettencourts, or their wealth manager or friends, while serving as budget minister until March.

An opinion poll conducted before the report was released indicated most voters do not trust Woerth. The LH2 survey published on Monday found that 57 percent of respondents had no confidence in the minister and only 28 percent trusted him.

The scandal contributed to the government losing a safe parliamentary seat to the left in a by-election on Sunday.

Woerth was treasurer of Sarkozy’s campaign and remained UMP treasurer while serving as budget minister in charge of tax matters, and his wife worked for Bettencourt’s wealth manager, prompting accusations of conflicts of interest.

Editing by Tim Pearce

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