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Sarkozy under pressure as treasury Woerth quits

By Felicity Spector

Updated on 13 July 2010

The French Labour minister Eric Woerth has resigned as treasurer of the ruling UMP party - amid a scandal over alleged illegal political donations.

Nicholas Sarkozy gives his interveiw (Credit: Reuters)

Police are investigating claims that he took an illegal £125,000 cash donation from Liliane Bettancourt - the 87 year old billionaire heiress to the L'Oreal cosmetics empire.

Critics claim Woerth abused his position to shield Bettencourt from a tax audit. His wife also worked for Bettencourt while he was budget minister.

The story - which is dominating headlines across France, has become a matter of political life or death for President Nicolas Sarkozy, whose popularity now at its lowest level since he came to power.

Woerth is one of his closest political allies, and it is alleged that the illegal donation, said to have been stuffed into an envelope, was destined for his 2007 Presidential campaign.

Police are also investigating whether Mme Bettencourt and her aides illegally avoided French taxes, hiding assets and holding secret bank accounts in Switzerland.

Last night Mr Sarkozy tried to draw a line under the scandal with a live interview on the state television channel France 2, from the terrace of the Elysee palace, It was ostensibly about pension reform, but dominated by the Bettencourt affair.

Mr Sarkozy insisted that Woerth had been cleared of any wrongdoing by an official report from the tax authorities, and had his full confidence:

"He is cleared of all suspicion, so there is no reason why I should get rid of him", he declared - although he did urge him to step down as UMP treasurer, a post Woerth has held for eight years," he said.

Mr Sarkozy went on to dismiss the bribery accusations in the strongest possible terms, calling them "lies" and "calumny".

"The very idea that I went to Mme Bettencourt to get money in envelopes... it's shameful."

The President insisted he had only been to the heiress' house a couple of times for a meal. "You imagine each time I left with money. You imagine I am intimate with Mme Bettencourt because I went there two or three times."

Sarkozy insisted France was not a corrupt country, adding "French public officials are people of great rigour. The most recent political scandal took place in Britain, not France."

Socialist leader Martine Aubry, who is tipped to challenge Sarkozy for the presidency in 2012, said his interview showed just how out of touch the President was with the French people, and repeated calls for a parliamentary inquiry.

Most of last night's interview, though, was devoted to Mr Sarkozy's unpopular pension reforms: he said he remained determined to raise the French retirement age from 60 to 62 - and make people contribute for longer to be eligible for a full pension.

He claimed the attacks on Woerth, who is in charge of overseeing the changes, were aimed at undermining the policy - and insisted he wouldn't be rushed into any cabinet reshuffles until the law was adopted in October.

Today the French cabinet endorsed the reforms: trade unions have already vowed to fight against the bill - with nationwide protests planned for September.

Police investigating the Bettencourt scandal carried out seven raids yesterday - searching a building next to the heiress' luxury villa outside Paris late into the night and raided the home of a close friend, Francois Marie Banier.

But President Sarkozy's popularity has already been hit. His UMP party lost what was once a safe parliamentary seat in a by-election on Sunday.

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