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Explainer-French lawmakers race to agree 2026 budget before year-end
Published by Global Banking and Finance Review
Posted on December 16, 2025
2 min readLast updated: January 20, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on December 16, 2025
2 min readLast updated: January 20, 2026
French lawmakers are negotiating the 2026 budget, aiming to finalize it before a December 23 vote, with a focus on keeping the deficit under 5% of GDP.
PARIS, Dec 16 (Reuters) - France's 2026 budget faces a decisive week as lawmakers race to hammer out a final compromise text before a crucial vote set for December 23.
Here is a summary of what is likely to happen in the coming days.
WHERE DOES THE PROCESS STAND?
A joint committee of seven lawmakers from both the lower house National Assembly and the upper chamber, the Senate, meets on Friday to try to agree on a final budget text.
The lower house failed to adopt its version of the bill last month and the Senate passed its version on Monday, substantially worsening the budget deficit.
Prime Minister Sebastien Lecornu's minority government wants the joint committee to agree on a text that keeps the deficit to less than 5% of economic output but can also clear the fragmented National Assembly, which is due to give its final say on December 23.
WHAT IF TALKS FAIL?
If the committee cannot agree, the Assembly will vote on a version of the bill incorporating the Senate-approved changes with a real risk that it might not pass.
To avoid deadlock, the government could propose stopgap legislation to maintain spending, taxation and borrowing until a proper budget can be adopted early next year. That would require both chambers to pass an emergency rollover law before year-end.
However, passing a budget next year is unlikely to be any easier, especially as political parties gear up for nationwide municipal elections in March.
IS THERE ANOTHER WAY?
In theory, the government could invoke Article 49.3 of the French constitution, which allows it to bypass parliament and force the budget through.
Previous minority governments infuriated opposition parties with this tactic and Prime Minister Sebastien Lecornu has pledged not to use it. However, some lawmakers, including from the opposition, now say it may be the only way to break the impasse.
(Reporting by Leigh ThomasEditing by Gareth Jones)
A budget deficit occurs when expenses exceed revenue, leading to a shortfall that must be financed through borrowing or other means.
A joint committee is a legislative committee composed of members from both houses of a bicameral legislature, working together on specific issues.
Stopgap legislation is temporary law enacted to address immediate needs or issues until a more permanent solution can be established.
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