France’s minority government led by Prime Minister François Bayrou could be ousted next month as three main opposition parties said they would not back a confidence vote slated for September 8 over his plan for sweeping budget cuts. The far-right National Rally and the Greens said they would vote against him, while the Socialists—on whose support Bayrou’s fate largely rests—said they did not see how they could back the prime minister unless he pivots on the budget in a way they do not expect.
The move raises the possibility that, if Bayrou loses the confidence vote in the National Assembly, his government will fall. Markets reacted with caution, as the risk premium on French bonds rose about 5 basis points above German equivalents to their highest level since mid-June, and the CAC-40 index closed the day down about 1.6%.
Should the government collapse, President Emmanuel Macron could immediately appoint a new prime minister, ask Bayrou to stay on as caretaker, or call a snap election. The episode recalls Macron’s previous experience with a government collapse in late 2024, when his last prime minister, Michel Barnier, lost a no-confidence vote over the budget after only a few months in office.
Bayrou acknowledged that seeking confidence from a highly fragmented parliament was a risky gamble. He said the confidence vote would test whether he had enough cross-party backing for his 44 billion euro budget squeeze, aimed at bringing France’s deficit toward the EU limit after it hit 5.8% of GDP last year—nearly twice the 3% target.
Even if Bayrou’s government survives the confidence vote, that would only signal political support for his fiscal approach; a separate vote on the actual budget is still expected later in the year. The plan includes measures such as scrapping two public holidays and freezing welfare spending and tax brackets in 2026 at 2025 levels, with a potential tweak to the proposal to eliminate the bank holidays.
There is a broader political backdrop to the confidence vote. In related discussions, Bayrou has floated the possibility of a national referendum on the budget as protests and concerns over austerity gain momentum. The French constitution allows the president to call referendums on government proposals, a route Bayrou has signaled as under consideration, though opposition parties warn it could complicate the political landscape further.
The budget plan comes amid questions about how France will address a persistent deficit while managing sensitive social and economic pressures. The Socialists’ reluctance to back the plan without changes underscores the political fragility of Bayrou’s coalition, even as the government argues that decisive savings are necessary to restore fiscal credibility.
What this means going forward is uncertain. If the confidence vote falters, Macron could pivot quickly to a caretaker arrangement or a fresh election, with the timing likely influenced by market reactions and the political calculus of who could command a broader majority. In the near term, investors and observers will be watching for shifts in parliamentary support, the fate of the 44 billion euro package, and any signals about potential referendums or alternative pathways for addressing France’s fiscal challenges.
Additional context and forward-looking take:
– The opposition’s unified stance against the current budget approach heightens the risk of a prolonged stalemate, keeping France’s fiscal reform plans in limbo and potentially widening market volatility around French assets.
– If a snap election occurs, the political landscape could shift, with implications for France’s approach to EU fiscal rules and the pace of structural reforms.
– The situation underscores how fragile coalitions can be when major austerity measures are on the table, and it highlights the continuing debate over how best to reconcile deficit reduction with social and economic stability.
In short, France faces a pivotal week ahead as Bayrou’s government confronts a confidence vote that could redefine the country’s budgetary path and political future, with outcomes echoing through markets, domestic politics, and the broader fiscal conversation in the euro area.
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