François Bayrou Unveils 2026 Budget Plan Aiming for €40 Billion in Savings
Prime Minister François Bayrou announces a €40 billion budget plan aimed at reducing the national deficit.
Key Points
- • François Bayrou aims to achieve €40 billion in savings for the 2026 budget.
- • The national deficit is targeted to decrease from 5.4% to 4.6% of GDP.
- • Increased defense spending has been proposed due to geopolitical tensions.
- • The budget is described as highly constrained and facing significant challenges.
On July 15, 2025, Prime Minister François Bayrou announced his strategic plan for the 2026 budget, targeting €40 billion in savings to significantly reduce France's national deficit from 5.4% to 4.6% of GDP. Bayrou emphasized the urgency of this plan, describing it as a 'fight of his life' as the country faces a constrained financial landscape amid rising geopolitical tensions, which necessitate an additional €3.5 billion allocation for defense spending.
The budget strategy comprises two main components: achieving sustainable public finances and bolstering production. Bayrou highlighted the potential for cost-saving measures such as freezing certain expenditures, maintaining income tax brackets without adjusting for inflation, and possibly reducing tax breaks and public aid to businesses.
This budget has garnered mixed reactions, with some describing it as a "courageous" yet challenging fiscal maneuver, while officials have compared it to an 'ordeal by fire.' The timing of this announcement allows the government to avoid immediate parliamentary scrutiny due to the summer recess, affording them critical time to frame public acceptance of upcoming budgetary constraints. As the plan materializes, Bayrou underlined his commitment to transparency and the equitable burden-sharing of fiscal responsibilities across various sectors.