France's Prime Minister Francois Fillon leaves the Elysee Palace following the weekly cabinet meeting
France's Parliamentary Relations Minister Patrick Ollier (L), Local Authorities junior Minister Philippe Richert (2nd L), Prime Minister Francois Fillon (2nd R) and European Affairs Minister Jean Leonetti (R) leave the Elysee Palace in Paris following the weekly cabinet meeting, November 7, 2011. REUTERS

French Prime Minister Francois Fillon on Monday announced plans for further budget savings of 7 billion euros in 2012 and 11.6 billion euros in 2013 as the euro zone's second-biggest economy seeks to protect its top-notch credit rating and avoid the financial market pressure now engulfing Italy.

He said the goal was to produce a further 65 billion euros of savings in all by 2016 in order to live up to France's goals for reducing the public deficit gradually to zero.

The second package of emergency budget adjustments in three months included accelerating the shift in retirement age to 62 from 60 in 2017, a year earlier than planned.

It also included a temporary 5 percent rise in corporate tax for firms with a turnover of more than 250 million euros, and an increase in the discounted rate of VAT sales tax to 7 from 5.5 percent with the exception of some items.

(Reporting By Brian Love and Vicky Buffery)