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2h ago

France Adopts 2026 Budget After No-Confidence Bids Fail, Paving Way for Defense Boost

Passage follows Article 49.3 use plus Socialist concessions.

French Prime Minister Sebastien Lecornu delivers a speech to announce the use by the French government of article 49.3, a special clause in the French Constitution, to push the first part of the budget bill for 2026 (PLF 2026) through the National Assembly without a vote by lawmakers, during a new debate on the draft budget bill at the National Assembly in Paris, France, January 20, 2026. REUTERS/Sarah Meyssonnier
French President Emmanuel Macron waits for the arrival of Denmark's Prime Minister Mette Frederiksen and Greenland Prime Minister Jens-Frederik Nielsen outside the Elysee Palace in Paris, Wednesday Jan. 28. 2026. (AP Photo/Thomas Padilla)
Prime Minister Sebastien Lecornu had promised not to ram the budget through without a vote

Overview

  • Lawmakers rejected two no-confidence motions filed after Prime Minister Sébastien Lecornu pushed the budget through without a vote.
  • The plan increases defense spending by roughly €6.5–€6.7 billion in 2026, funding a new nuclear-powered attack submarine, 362 armored vehicles, Aster air-defense missiles and a new voluntary service.
  • The government targets a 5% of GDP deficit next year, with business tax measures expected to raise about €7.3 billion.
  • Socialist support was secured by delaying the retirement-age hike and adding measures such as €1 student meals and a higher top-up payment for low-income workers.
  • Investor nerves have eased as France’s bond spread over Germany narrows, while Macron enters a domestic lame-duck phase and Lecornu’s stature grows heading into election season.