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11h ago

France’s Budget Standoff Deepens as Senate Rejects Social Security Bill and ‘Special Law’ Looms

Economists say relying on a special law into 2026 would cut state receipts and could push the deficit above the government’s 5% goal.

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Les sénateurs rejettent à une large majorité le budget de la Sécurité sociale voté par les députés

Overview

  • The Senate rejected the 2026 Social Security financing bill by 182 votes to 106 through a procedural motion, sending the text back to the National Assembly for a final vote next week.
  • The state budget has been extensively rewritten in the Senate, and a joint committee is widely expected to be inconclusive, making adoption by December 31 increasingly unlikely.
  • Prime Minister Sébastien Lecornu maintains the objective of having a budget by year-end, as ministers float procedural alternatives even as the executive publicly rules them out.
  • Socialist leader Olivier Faure warned that using article 49.3 without a prior compromise would trigger an immediate motion of censure, constraining the government’s options.
  • The OFCE estimates a full-year special law could cost roughly €6.5 billion in receipts and lift the 2026 public deficit toward 5.5% of GDP, while the government must still plug about €4.5 billion to offset transfers to Social Security.