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French Budget Standoff Deepens as Assembly Panel Rejects Spending, Senate Moves to Restore Pension Reform

The government now points to the upper house as the venue to purge disputed amendments through the parliamentary shuttle.

Overview

  • Government-aligned deputies say they will not back the revenue package, denouncing several Assembly-voted taxes as insincere, as the prime minister signals a legal and bicameral 'coffee filter' to remove them.
  • The Assembly’s finance committee has now rejected both the revenue and spending sections of the 2026 state budget, with only Socialist members abstaining and no majority in sight for a first-reading vote.
  • The Senate opened its Social Security debate with the right–centre majority set to reverse key Assembly changes, notably reinstating the 2023 pension reform and scrapping hikes such as a capital-focused CSG increase.
  • Senators aim to pull the social accounts back toward the government’s original deficit target by reviving a one-year freeze on most pensions and benefits while preserving protections for lower pensions and the AAH.
  • After a rare rejection of a technical year-end budget bill forced fresh calculations at Bercy, talk is intensifying of fallback routes including a special carryover law, ordonnances or a delayed budget if a CMP deal fails.