A joint committee of French lawmakers failed on Friday to reach a compromise on next year’s state budget, meaning France will not have a budget for 2026 by the end of the year, parliamentary sources said.
The 2025 budget is now likely to be carried over into the new year as discussions continue in both chambers.
“Parliament will therefore not be able to vote on France’s budget before the end of the year,” Prime Minister Sebastien Lecornu said after senators and members of the House of Representatives were unable to agree.
France, the second-largest economy in the euro zone, is under pressure to rein in its deficit and rising debt, but efforts have been hampered by political deadlock.
Lecorno was named in September – and then renamed the following month after he stepped down – after parliament ousted his two predecessors over cost-cutting measures.
He had pledged to approve the budget by the end of the year, but did not use constitutional authority to pass it without a vote in Parliament, as happened in previous years.
In a win for Licorno, lawmakers on Tuesday narrowly approved the Social Security budget, part of a broader spending plan, delaying the unpopular pension reform until 2028.
But they were unable to pass the state budget, which was complicated by a tug of war between the right-leaning Senate, which wants to cut costs, and the hung House, in which the left demands more tax revenue.
– “Special law” –
Lecorno said that starting Monday he would gather “key political leaders to consult with them on the way forward.”
Lecorno’s team told AFP that the government will seek to pass a so-called “special law” to temporarily carry over the 2025 budget to the new year while discussions continue.
The special law would allow the state to continue collecting taxes after January 1, effectively enabling it to continue paying civil servant salaries.
But central bank governor François Villeroy de Galhau warned on Friday that this was only a short-term solution.
He told France Inter radio that if France kept its 2025 budget in place until next year, it would lead the country to a “deficit much higher than required.”
Political deadlock also delayed the adoption of France’s 2025 budget, with the spending plan approved in February after then-Prime Minister François Bayrou endorsed it in the House of Representatives.
France has been facing a deep political crisis since President Emmanuel Macron called early elections last year that were intended to consolidate his power but instead resulted in a hung parliament and gains for the far right.
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