France lawmakers fail to agree on state budget, say parliament sources

"The government is now likely to push for parliament to vote a so-called "special law" to 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 1st, effectively enabling it to keep paying civil servant salaries, as well as pensions."

"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, but efforts have been hampered by political deadlock. Prime Minister Sébastien Lecornu has pledged to produce an austerity budget by year end, without using a constitutional power to ram through the bill without a parliament vote, as done in previous years."

A joint committee of French lawmakers failed to reach a compromise on the state budget for next year, making a full 2026 budget by year-end unlikely. The 2025 budget is likely to be carried over into 2026 while debates continue in both chambers. France faces pressure to rein in a rising deficit and soaring public debt amid political deadlock. Prime Minister Sébastien Lecornu pledged an austerity budget by year-end without invoking constitutional powers used previously. Lawmakers narrowly adopted the social security budget, effective January 1, 2026, including a freeze on pension age changes. The second half of the budget remains contested between a cost-cutting Senate and a revenue-seeking lower house. The government may seek a special law to temporarily carry over the 2025 budget to enable tax collection and payments, but the central bank warned such a carryover would raise the deficit.

Read at The Local France