French Government Adopts Temporary Special Law Amid Budget Stalemate for 2026

As France enters 2026 without a formally approved budget, the government has implemented a special law to temporarily finance state operations amid parliamentary deadlock. This law, described as a "safety net" by Economy Minister Roland Lescure, allows for ongoing tax collection and state borrowing but excludes any cost-cutting measures. Lescure emphasized the law's costly nature, warning that while it will keep government functions running, it does not enable investment.

President Emmanuel Macron expressed dissatisfaction with the special law, criticizing it for failing to address critical issues like the national deficit and priority expenditures. He urged a swift transition to a comprehensive budget in January that satisfies the government's target of a 5% deficit. The government spokesperson, Maud Bregeon, highlighted that the focus should remain on the substance of the budget rather than its adoption process. Meanwhile, Lescure ruled out the employment of the controversial constitutional tool Article 49.3 to pass the budget, referencing its previous negative consequences which left France without an official budget or government for two years.

Despite the impasse, discussions toward a full budget continue, with informal exchanges on debated budget items already underway in the Assembly and Senate. Prime Minister efforts underpin optimism that a formal budget might still pass without the need for extraordinary measures. The special law thus serves as an interim mechanism ensuring financial continuity while deeper negotiations proceed.

This development marks a critical juncture for France's financial policy as political leaders confront the challenges of fiscal responsibility and democratic consensus in uncertain times.