France's new prime minister faces first major test in politically unstable period

Paris– France's new Prime Minister François Bayrou faces his first major test in parliament on Tuesday as his government falls short of a majority amid unprecedented political instability.

Bayrou will address lawmakers in a general policy speech outlining his top priorities, including key budget decisions, a month after being appointed by President Emmanuel Macron.

Beru urgently needs to pass a 2025 budget bill. An emergency law has been approved after the collapse of the previous government, allowing the state to collect taxes, pay for basic expenses and avoid shutdowns from January 1.

But only a proper budget can help reduce France's deficit and allow for critical spending, such as defense measures needed during the war in Ukraine or aid promised to angry farmers.

Financial markets, ratings agencies and the European Commission are urging France to comply with EU rules limiting debt and prevent France's borrowing costs from rising sharply. This would threaten the prosperity of euro area countries.

France's deficit is expected to reach 6% of gross domestic product (GDP) by 2024. Finance Minister Éric Lombard said last week that the government “targets a deficit between 5% and 5.5%” this year.

When Bellew took office, he said that “no one understands the difficulty of the situation better than him,” and he compared the challenges he faced to the “Himalayas.”

Bayrou's cabinet relies on a fragile agreement between Macron's centrist allies and Republican conservatives, who together do not even have a parliamentary majority.

The previous government lasted just three months before being overthrown by left-wing and far-right opposition lawmakers over budget disputes.

To prevent this from happening again, Beru sought a non-aggression pact with the Socialists so that they would not support any future efforts to overthrow the new government.

The Socialists say they are open to talks if they include talks on Macron's unpopular pension reforms passed two years ago.

However, the possibility of another no-confidence vote still looms.

The far-left French Indies party refuses to negotiate with the government and has announced it will table a motion of no-confidence.

There is little chance of success in a vote later this week, as the far right appears unwilling to support the move in the short term.

However, the issue is likely to be raised again in future budget debates in Parliament, with the outcome being more uncertain.

Macron's plan to raise the retirement age from 62 to 64 sparked massive protests that lasted for months from January to June 2023, damaging his leadership. The legislation, which has been gradually implemented, also requires people to work for 43 years before receiving a full pension.

The Socialists are now urging Beru to declare a “pause” on the reforms to provide time for renegotiations, with the aim of backdating the age of 64 and introducing specific measures for those with long-term careers and those considered professional. Thanks for your hard work.

An announcement of a suspension would spark outrage on the other side of the political spectrum and could further weaken Bellou's government.

Conservative Senate President Gérard Lacher warned that pension measures should not be suspended or repealed.

“If we repeal the pension reform, the cost will be 3.4 billion euros ($3.47 billion) in 2025 and almost 16 billion euros ($16.3 billion) in 2032,” he said.

Far-right leader Marine Le Pen – Macron's fiercest rival – played a major role in overthrowing the previous government.

Bellew consulted her for advice in forming a new government, and Le Pen remains a powerful force. Her National Rally party has the largest single group in the National Assembly, France's powerful lower house of parliament.

In recent days, Bayrou's government has tried to sideline Le Pen by negotiating budget issues with the Socialists, Greens and Communists.

Jordan Bardella, the president of the National Rally, criticized the talks and warned on Monday that his party would oppose anything that would raise drug costs, provide more health care for immigrants who are in the country illegally and impose restrictions on businesses. Budget for new taxes. He said such measures would provide grounds for a vote of no confidence.

But Le Pen will face her own headache in the coming months – a court ruling in March over alleged illegal party financing could result in her being barred from running for office.