The finance bill’s ‘revenue’ section was rejected in the National Assembly due to insufficient support from key blocs. It will now be sent to the Senate for further discussion, where the government holds a strong majority. Senators plan to negotiate significant budget cuts while fostering a collaborative atmosphere. The Senate will also address the Social Security financing bill shortly. Ultimately, joint committees will work towards a compromise, with the government committed to dialogue throughout the process.
Finance Bill Rejected: A New Path Ahead
In a predictable turn of events, the ‘revenue’ section of the finance bill met with rejection in the National Assembly, lacking the support from the ‘central bloc’ and the National Rally. The government’s proposal, significantly altered by opposition parties such as the New Popular Front, was turned down on Tuesday, November 12.
Senate’s Role in the Budget Debate
As a result, both the ‘revenue’ and ‘expenditure’ components of the bill will be forwarded to the Senate for discussion starting Wednesday, November 13, where it will be considered in its original form. This shift is seen as advantageous for the government, with insiders suggesting, “Barnier awaits the Senate like the Messiah,” according to a common base member.
In the Senate, Michel Barnier’s administration boasts a substantial majority, holding nearly 250 out of 348 seats, including around 130 from the Les Républicains party, which Barnier represents. The senators plan to leverage their influence in the discussions, particularly regarding the proposed cuts of at least five billion euros to local authority budgets. “Here, he has a very broad base to support the difficult policy that will be his,” acknowledges centrist senator leader Hervé Marseille, who confidently states, “The budget will be written here in the Senate.”
The Senate is expected to foster a more deliberative atmosphere, promoting consensual dialogue, as noted by a minister. “You can sense that the Senate will play a more significant role in the debate. Bicameralism can prove to be more beneficial than we realize,” expressed Jean-François Husson, the general rapporteur of the budget.
In recent days, the government has signaled its willingness to negotiate with the Senate, making notable concessions, particularly concerning pension adjustments. Budget Minister Laurent Saint-Martin signaled openness to adopting the proposal from MoDem deputy Jean-Paul Matteï to make the high-income tax permanent, while aiming to reduce the deficit to around 4%.
Barnier has also pledged collaboration with the Horizons deputy leader, Laurent Marcangeli, to explore a ‘unique social allowance.’ Additionally, in response to queries from Laurent Wauquiez, he confirmed that the government is prepared to implement a review clause to reassess the impacts of a contentious electricity tax within their coalition.
Looking ahead, the Senate will also begin reviewing the Social Security financing bill on Wednesday, which the National Assembly failed to pass on time. Discussions on the Social Security budget are set for November 18 to 23, with a formal vote planned for the 26th, while the finance bill will occupy senators from November 15 to December 12.
Ultimately, joint committees comprising deputies and senators will convene to craft a compromise text for both chambers to vote on, potentially leading to the invocation of Article 49.3 in the Assembly. However, the government aims to maintain its commitment to dialogue and respect for parliamentary processes up to that point.