France Faces Budget Deadlock as Government Prepares Special Law Amid Social Security Budget Success

On December 9, 2025, Prime Minister Sébastien Lecornu successfully secured the passage of the social security budget, known as the 'Sécu,' in the National Assembly. This notable achievement was accomplished without invoking article 49.3 of the Constitution, which permits a law to pass without a vote. Lecornu's strategy of building a parliamentary compromise, especially with the Socialist Party, led to the budget's adoption with 247 votes in favor, 234 against, and 93 abstentions. This success marks a stark contrast to the failures experienced by his predecessors since 2022.

Despite this positive development, the broader state budget negotiations remain fraught with political contention. The right-wing majority Senate rewrote the state budget and planned to vote on it on December 15, while the National Assembly nearly unanimously rejected it. According to government spokesperson Maud Bregeon, a joint committee comprising members from both chambers will meet on December 19 to seek an agreement. However, if this effort fails, talks are expected to extend into January to reach consensus, which is not uncommon given the budget's political complexity.

In anticipation of potential deadlock, the government is preparing to enact a special law by the end of December. This legislation would allow essential government operations to continue despite the absence of an adopted state budget by enabling the collection of existing taxes and restricting expenditures to critical outlays from the prior year.

Economic context adds pressure to the negotiations. François Villeroy de Galhau, Governor of the Banque de France, indicated that growth forecasts for 2025 and 2026 will be revised upwards slightly—from 0.7% to 0.8% this year and around 0.9% next year—with official figures to be released on December 19. While these figures show economic resilience, Villeroy emphasized that growth remains insufficient. He cited political uncertainty as reducing growth by approximately 0.5 percentage points, with national political instability accounting for at least 0.2 points. A stable political and budgetary framework could recover these losses, underscoring the importance of resolving the budget stalemate.

Lecornu's remarks highlight the difficulty ahead: while he successfully navigated the social security budget, the state budget negotiations pose even greater challenges. The government remains cautiously optimistic but pragmatic, preparing legal contingency plans to maintain governance amid ongoing political divisions.