While the shortfall on the target for reducing the budget deficit may be largely due to low growth, firm measures to reduce it significantly over the next few years remain necessary. Moves to simplify parts of the tax system are welcome; introducing more tax breaks for certain activities unfortunately offsets this, adding to the system’s complexity. Social unrest calls for policies to improve prospects for the excluded. Fundamental labour market reforms, including liberalising regulations that restrict job opportunities for the low-skilled, should be a key component.