Paris [France], August 26: France's minority government could be ousted next month after three main opposition parties said they would not back a confidence vote which Prime Minister Francois Bayrou announced for September 8 over his plans for sweeping budget cuts.
The far-right National Rally and the Greens said they would vote against him. The Socialists, on whose vote Bayrou's fate largely lies, said they did not see how they could back him - unless he changes tack on the budget, which they did not see as likely to happen.
If he loses the confidence vote in the National Assembly, Bayrou's government will fall.
The uncertainty spooked investors, pushing the risk premium on French bonds over their German equivalents up 5 basis points to their highest level since mid-June. The CAC-40 index (.FCHI), opens new tab of leading French shares ended the day down 1.6%.
If the government falls, President Emmanuel Macron could name a new prime minister immediately or ask Bayrou to stay on as head of a caretaker government, or he could call a snap election.
Macron lost his last prime minister, Michel Barnier, to a no-confidence vote over the budget in late 2024, after just three months in office following another snap election in July that year.
Bayrou acknowledged seeking the confidence of a very fragmented parliament was a risky bet.
The confidence vote, he said, would gauge whether he had enough support in parliament for his 44 billion euro ($51.51 billion) budget squeeze, as he tries to tame a deficit that hit 5.8% of gross domestic product last year, nearly double the official EU limit of 3%.
Even if the government wins the confidence vote, it would only mean he has support for his views on France's fiscal woes, with a vote on the actual budget itself due later in the year.
Bayrou has proposed scrapping two public holidays and freezing welfare spending and tax brackets in 2026 at 2025 levels, not adjusting them for inflation. He said his proposal to scrap the bank holidays could be tweaked.
Source: Fijian Broadcasting Corporation
