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France to Lift Departmental Rescue Fund to €600 Million as Over Half of Departments Face Crisis

Department chiefs cite surging social mandates alongside collapsing transaction revenues as budgets slide into the red.

Overview

  • Prime Minister Sébastien Lecornu announced a plan to raise the safeguard fund for departments to €600 million to support the most distressed budgets.
  • At the ADF congress in Albi, François Sauvadet said 54 departments are in a state of “quasi-bankruptcy,” underscoring the breadth of the crunch.
  • Department leaders point to soaring social spending, state-imposed costs compensated only in part, and revenue hits totalling about €6 billion in new charges and €8.5 billion in lost receipts within three years.
  • Service reductions are spreading, with sexual health centers closed in Drôme, family planning aid trimmed in Loiret, and steep cuts to culture in Ille-et-Vilaine and Hérault, where 64% of departments report reductions.
  • Gironde illustrates the fallout with a €97 million deficit, cancelled or suspended middle-school projects, and 232 job cuts, while the Cour des comptes lists 15 departments in serious difficulty and Charente has been placed under prefectural oversight.