French Government Eyes Article 49.3 to Pass 2026 Budget Amid Parliamentary Deadlock

The French government announced it is unable to pass the 2026 national budget through the National Assembly due to a lack of majority support. Laurent Panifous, Minister for Relations with Parliament, stated that the government is definitively moving away from a budget text acceptable to a majority of deputies, signaling a shift from attempting a parliamentary compromise. Consequently, debates originally scheduled for mid-January have been suspended until Tuesday, January 19, as the government seeks alternative means to adopt the budget.

The budget process has been fraught with setbacks, including the Finance Committee's rejection of the proposed text and the failure of key amendments such as a surtax on large corporate profits, which would have yielded an estimated 6.3 billion euros. Political tensions are high, with Public Accounts Minister Amélie de Montchalin accusing the left-wing La France Insoumise and the far-right Rassemblement National parties of "systematic sabotage," voting for amendments that make the budget unpassable.

Faced with these hurdles, the government is now preparing to invoke constitutional Article 49.3 or to use ordinances to pass the budget without a vote in the Assembly. Both options carry the risk of censure motions from deputies. Prime Minister Sébastien Lecornu is expected to announce planned modifications to the budget proposal and seek constructive dialogue with the Socialist Party and independent deputies to try to avoid such extreme legislative measures.

The budget faces an additional challenge as the projected public deficit stands at 5.3% of GDP, exceeding the government’s self-imposed ceiling of 5%. The Finance Committee rejected the current draft primarily over concerns about fiscal balance. The government also aims to implement a controversial 4.9 billion euro cut in global operating grants to local authorities, a measure initially proposed by the Rassemblement National.

In summary, the French government is navigating a political impasse surrounding the 2026 budget, balancing the need for fiscal stability against increasing parliamentary opposition. The decision whether to employ Article 49.3 or ordinances to pass the budget may come as soon as Tuesday, with final approval not expected before mid-February.