Explainer: Why France’s government faces another collapse
Bayrou is seeking backing for his unpopular budget plan to rein in public finances
France's centrist government is once again on shaky ground. Prime Minister Francois Bayrou has called a surprise confidence vote in parliament next week that could topple his administration and deepen political instability in the European Union's second-largest economy.
Why is Bayrou in trouble?
Bayrou is seeking backing for his unpopular budget plan to rein in public finances. France's deficit hit 5.8% of GDP last year, nearly double the EU's 3% ceiling. He aims to cut borrowing to 4.6% of GDP in 2026 and below 3% by 2029 through deep spending cuts, reduced public sector hiring and changes to pensions, says Al Jazeera.
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"The issue, the question, is not the fate of the prime minister or… even the fate of the government. The question is the fate of France," Bayrou said.
But opposition parties say they will vote against the budget, leaving Bayrou's minority coalition without the support it needs in the 577-seat National Assembly. If he loses Monday's ballot, President Emmanuel Macron would be forced to appoint a new prime minister — the third in a year.
What are the proposals?
Bayrou's plan targets €43.8 billion ($51 billion) in savings for 2026, mainly through spending cuts. Measures include suspending pension indexation to inflation, scrapping two public holidays and raising taxes on high earners. The proposals build on Macron's unpopular 2023 decision to raise the retirement age to 64, which he argued was necessary because "excessive pension payments were a drag on the country's finances."
Finance Minister Eric Lombard warned on Aug. 26 that unless France curbs its debt, outside intervention could loom. "Interventions from the International Monetary Fund… is a risk that is in front of us," he said.
How have parties reacted?
Opposition lawmakers on both left and right have rejected Bayrou's proposals. The hard-left Unbowed said they want to "make the government fall." The Greens' Marine Tondelier described the confidence vote as "a resignation de facto," while Socialist Party leader Olivier Faure said Bayrou had "chosen to go."
On the far-right, National Rally chief Jordan Bardella said his party would "never vote in favour of a government whose decisions are making the French suffer." Bayrou's move, he added, was "the end of his government."
What about financial markets?
Bayrou's announcement rattled investors. France's 10-year bond yield rose to 3.5% on Monday, above Greece's 3.36%. Bank shares including BNP Paribas and Societe Generale fell 8–10% last week, reports Al Jazeera.
"The political situation is causing wider spreads [between France's borrowing costs and its European peers]," said Davide Oneglia, analyst at research firm TS Lombard. "We're not at a full-blown debt crisis yet, but the fiscal situation is becoming more urgent."
What happens next?
Most analysts expect Bayrou to lose Monday's vote, forcing Macron to replace him. But that would not change the parliamentary arithmetic that has stymied reforms since last year's snap election.
Some politicians, including far-right leader Marine Le Pen, have urged Macron to call new legislative elections. But polls show little shift in voter sentiment since 2024 and rising support for the National Rally ahead of the 2027 presidential race.
Oneglia said the outcome of that election could mirror Italy in 2022, when Giorgia Meloni's right-wing party moderated once in power. "It wouldn't surprise me to see a similar outcome in France in 2027 [if the National Rally were to win]," he said. Until then, he expects France's politics to drift in "'kicking into the long grass' mode."
