Explainer-What you need to know about France's political crisis

By Ingrid Melander

PARIS (Reuters) -French Prime Minister François Bayrou faces a confidence vote on Monday, which he is expected to lose, plunging the euro zone's second largest economy deeper into political crisis. 

Here is what you need to know:

HOW DID WE GET HERE?

France's politics have become increasingly fraught since President Emmanuel Macron bet big by calling a snap parliamentary election in 2024 which resulted in a deeply fragmented parliament.

His own ruling alliance, already shorn of a majority since his re-election in 2022, saw its numbers fall, while the far-right National Rally emerged as the biggest party in the assembly. 

Macron's control over parliament weakened as France's debt ballooned, in part due to his largesse during the COVID and cost-of-living crises. France is now under acute pressure to fix its finances. Public debt has climbed to 113.9% of GDP. Last year's deficit was nearly double the EU's 3% limit.  

Saying tough decisions were needed, Bayrou, a veteran centre-right politician and Macron's fourth prime minister since his re-election, sought to pass a budget for 2026 that would require 44 billion euros ($51.51 billion) in savings, including pension freezes, healthcare cuts, and the scrapping of two public holidays.

This provoked an outcry from opponents. Unable to see a path to adoption, Bayrou called a confidence vote on his fiscal strategy, in a gamble the opposition called political suicide.

Opposition parties have made clear they would vote him out, and they have more than enough MPs to do so. 

WHAT HAPPENS ON SEPTEMBER 8?

The National Assembly convenes at 1500 (1300 GMT).

Bayrou will open with a speech in which he will plead his case, warning of the dire state of France's finances and the need to tackle it. With almost no hope of winning, that speech will be for the record - or his political future - rather than to try to convince lawmakers.

Each of the 10 parliamentary groups will respond, which will then be followed by a vote. Lawmakers will each drop a paper ballot into an urn.

The result is based on an absolute majority of votes cast — not of total seats.

If, as expected, the government loses, Bayrou must then submit his resignation to Macron.

There is no official schedule yet, but the outcome of the vote would be expected to be sometime around 1730-1800 GMT.

WHAT ARE MACRON'S OPTIONS IF BAYROU LOSES THE VOTE?     

It's all in Macron's hands.

The president has so far ruled out snap elections if Bayrou falls and would therefore be required to appoint a new prime minister.

That new PM could be from the centre-left, after four centre-right picks failed to manage the fractured parliament. Or Macron could name a technocrat. There are no rules governing who Macron must choose, or how quickly. 

If Macron takes his time, Bayrou could stay on in a caretaker capacity.

The National Rally and hard-left France Unbowed are pushing for snap parliamentary elections - and for Macron to resign.

At a lunch this week between Macron and centrist and conservative parties that back the current government, all agreed a dissolution of parliament would not solve the crisis, a source close to Macron said, adding that striking a deal with the Socialists seemed like one of the only viable options.

A government source confirmed a snap parliamentary election did not seem on the cards for now, adding that Finance Minister Eric Lombard, former Socialist prime minister Bernard Cazeneuve, and Court of Auditors chief Pierre Moscovici, also a long-time Socialist, were among names circulating as possible choices for the next prime minister.

Beyond the fate of the government, France faces a tense September:

- On September 10: the grassroots Bloquons Tout ("Let's block Everything") movement, that has mushroomed on social media, plans nationwide protests. 

- On September 12: Fitch reviews France’s credit rating. A downgrade is possible if the crisis deepens.

- On September 18: Trade unions hold strikes and protests.

($1 = 0.8542 euros)

(Additional reporting by Michel Rose and Elizabeth Pineau; Writing by Ingrid Melander, Editing by William Maclean)