In this file photo, French President Francois Hollande, left, and French PM Jean-Marc Ayrault wait for Chinese President Xi Jinping and his wife Peng Liyuan, at the Chateau de Versailles, west of Paris. Picture: Michel Euler, Pool, File


Paris - President Francois Hollande will make a televised statement on his government as early as Monday, a close ally said, as left-wingers demanded an end to pro-business reforms and budget cuts following a local poll rout for his Socialist party.

Speculation of a cabinet reshuffle grew as Prime Minister Jean-Marc Ayrault acknowledged he and his ministers bore the blame for Sunday's defeat, which saw 155 towns swing to the centre-right UMP and the far-right National Front claim 11.

"The president will make a statement on television, that is certain," Francois Rebsamen, a Socialist senator and long-time Hollande ally, told Reuters.

"I don't see how there won't be a major reshuffle," he said of a government which polls show the French do not trust to turn around unemployment of more than 10 percent.

There was no confirmation of a TV statement from Hollande's office, where he was holding talks with Ayrault. A report by i>TELE TV that he had also met Interior Minister Manuel Valls - tipped by many as the next premier - could not be confirmed immediately.

Facing the lowest popularity levels of any president in France's 56-year-old Fifth Republic, the Socialist changed tack earlier this year towards a more pro-business stance aimed at spurring investment and jobs through corporate charge cuts.

Hollande has said the mid-April vote in parliament on the "responsibility pact" package of 30 billion euros of cuts is also a vote of confidence in his government.

But questions grew over whether he would stick to a reformist stance as left-wingers said the record abstention rate of the town hall votes showed that working-class voters wanted Hollande to return to his Socialist roots and abandon the pact.

"Don't be afraid to abandon this path," said an open letter to Hollande posted on the website of Paris Socialist senator Marie-Noelle Lienemann and signed by fellow left-wingers Jerome Guedj and Emmanuel Maurel.

"Job creation comes from a re-launch of public investment and consumption," it said, urging Hollande to end a freeze on public sector salaries, raise the minimum salary and pensions.

Weeks before France must present the EU with new details of plans to bring down its public deficit, the letter said the government should simply ignore the demands of the EU stability pact committing it to a deficit under three percent of output.

Data released on Monday showed France's deficit stood at 4.3 percent in 2013, above its 4.1 percent target.

Provisional results from Sunday's voting showed the anti-EU National Front party of Marine Le Pen taking control of 11 towns across the country plus one district in Marseille, surpassing a past record in the 1990s when it ruled in four towns.

"Punishment", read a front-page headline in the left-leaning Liberation newspaper.

While Hollande himself will remain in power, the question is whether he will replace Ayrault, whose government has been accused of amateurism and of being paralysed by policy splits.

"Rather than reshuffling he should actually do something - for the moment he has done nothing at all," said Nadege Cartei, a 40-year-old worker in the finance sector in Paris.

The National Front's wins were largely in the south, which has a tradition of anti-immigrant feeling. But it also took power in northern towns such as Henin-Beaumont and Hayange, which are suffering from France's industrial decline.

"This result is proof that we can win on a grand scale," Le Pen told BFM TV, adding that the vote showed her party could win European Parliament elections due in late May. Pollster Ipsos on Sunday put the FN narrowly behind the UMP for the EU vote, with the Socialists trailing in third place.

The FN now has a fresh chance to show it can be trusted with power after its attempts to run towns in the 1990s were widely judged to have exposed its failings, hurting its electoral fortunes for years afterwards.

In some consolation for Hollande, Socialists retained control of Paris city hall, with their candidate Anne Hidalgo due to become the first female mayor there.

But they ceded power in cities such as Toulouse, Angers, Reims, Caen and Saint-Etienne. The UMP saw off a challenge to its rule in the port of Marseille, although the FN won in the city's seventh district. - Reuters