Prime Minister Michel Barnier has made concessions on electricity pricing and immigration policies to dissuade the National Rally from initiating a motion of censure against him. He announced a halt to increased electricity taxes, resulting in a greater cost reduction, and a willingness to revise state medical aid for undocumented migrants. Despite these efforts, Marine Le Pen warns of potential repercussions if further demands are not met by Monday, as the government faces critical budget negotiations amid rising tensions.
In a strategic move, Prime Minister Michel Barnier made concessions regarding electricity pricing and immigration policies on Thursday, aiming to persuade the National Rally to refrain from launching a motion of censure against him. Despite these efforts, the party led by Marine Le Pen remains steadfast, warning of potential upheaval if Barnier does not address their remaining demands by Monday.
Concessions on Electricity and Immigration
With critical deadlines approaching for budget discussions in the National Assembly, Barnier announced the decision to halt plans for increased electricity taxes beyond the pre-inflation shield level. “This will result in a 14% reduction in electricity costs, exceeding the initially proposed 9% cut,” he stated during an interview with Figaro.
Additionally, Barnier has indicated a willingness to partially meet the National Rally’s call for a decrease in state medical aid (AME) for undocumented migrants. He plans to significantly reduce the scope of covered care and has committed to initiating a reform of the AME next year to curb misuse and exploitation, a consistent demand from both far-right and right-wing factions concerning immigration issues.
Jordan Bardella, the RN president, expressed satisfaction with the electricity concessions on social media, labeling it a ‘victory,’ while also cautioning that ‘red lines remain’ for his party.
Despite these gestures, Marine Le Pen emphasized in Le Monde that challenges persist, issuing a warning to the Prime Minister. “He has until Monday to respond,” she insisted, underscoring the urgency of the situation.
Monday marks the deadline for the government to revise its social security budget proposal. Le Pen continues to demand pension increases for all retirees starting January 1, along with the cancellation of planned reductions in drug reimbursements.
As the leader of the largest parliamentary group, Le Pen holds significant influence over the Barnier government’s future, insisting that the administration clarify how it plans to financially offset its concessions.
Navigating a Fragile Budget Situation
Having been in power for just over two months, the Barnier government is now facing a critical test, with the RN threatening to ally with the left to vote on a motion of censure related to the social security budget. This vote could occur as early as next week when the budget returns to the National Assembly on Monday. The RN is also backing the New Popular Front’s initiative to repeal the controversial pension reform introduced previously.
Regarding the budget, the government has indicated readiness to enhance the proposed texts, which anticipate 60 billion euros in efforts by 2025 to address a significantly deteriorated public deficit projected at 6.1% of GDP for this year. Compromises have been made, particularly concerning pension adjustments.
Barnier reassured that these ‘adjustments’ would not compromise France’s commitments to the European Commission. “We are striving to maintain a deficit around 5% in 2025,” he affirmed, while France, the eurozone’s second-largest economy, is already under scrutiny from Brussels regarding its fiscal situation, awaiting the S&P rating agency’s decision on its debt.
In a bid to appeal to both Le Pen’s supporters and Macron’s camp, Barnier confirmed that business tax reductions would remain intact for salaries up to 2.25 times the minimum wage. “Moving forward, everyone must take their responsibilities during the budget votes,” he stated at a gathering of small and medium-sized enterprises, following his announcement on electricity, which requires him to forgo 3.4 billion euros in tax revenue.
Former minister Gérald Darmanin from the Macron camp expressed gratitude to Barnier for engaging with parliamentarians, while MP Jean-René Cazeneuve cautioned against negotiating with the National Rally. Meanwhile, the left has voiced strong opposition to the concessions made to the RN.
“The Prime Minister is turning his back on the republican front,” remarked Olivier Faure, head of the socialists, criticizing Barnier for leaning toward the far right to escape censure, describing the move as a ‘shameful alliance’ focused on curbing state medical aid.
The government warns that failure to maintain its position may lead to budget rejection, plunging France into financial turmoil. The prospect of a governmentless France is already unsettling markets, with France’s borrowing rate briefly surpassing that of Greece, a country that once faced bankruptcy.