French parliamentary committee fails to agree on 2026 state budget, likely forcing a temporary extension of 2025 spending amid political gridlock
PARIS: A joint committee of French lawmakers has failed to reach a compromise on the state budget for 2026.
Parliamentary sources confirmed the deadlock on Friday, making it unlikely France will have a new budget by the end of the year.
The 2025 budget is now likely to be carried over into the new year as debates continue in both chambers.
France, the eurozone’s second-largest economy, is under pressure to rein in its deficit and soaring debt.
Prime Minister Sebastien Lecornu has pledged to produce an austerity budget by year end without using a constitutional power to bypass parliament.
Lawmakers narrowly adopted the social security budget on Tuesday, part of the broader spending plan.
That vote postponed an unpopular pensions reform until 2028.
The state budget has been complicated by a tug of war between the right-leaning Senate and the lower house.
The Senate wants to cut costs, while the left in the lower house has demanded more revenue.
The government is now likely to push for parliament to vote on a so-called “special law”.
This would temporarily carry over the 2025 budget into the new year while debates continue.
That vote could happen as soon as Monday.
The special law would allow the state to continue collecting taxes after January 1.
It would enable the government to keep paying civil servant salaries and pensions.
Central bank governor Francois Villeroy de Galhau warned this was only a short-term solution.
He told France Inter radio that keeping the 2025 budget would lead to a “deficit far higher than desired”.
Political gridlock also delayed adoption of France’s 2025 budget.
That spending plan was only approved in February after then-prime minister Francois Bayrou forced it through the lower house. – AFP
