French government faces collapse as left and far-right submit no-confidence motions

The French government is all but certain to collapse later this week after far-right and left-wing parties submitted no-confidence motions against Prime Minister Michel Barnier, a political reckoning almost certain to send shock waves across the eurozone.

Barnier on Monday invoked a rarely used constitutional mechanism to push through the contentious 2025 budget without parliamentary approval, arguing it was essential to maintain “stability” amid deep political divisions.

The move immediately drew sharp backlash, with Marine Le Pen’s far-right National Rally (Rassemblement National — RN) and the leftist New Popular Front both filing no-confidence motions in response, setting the stage for a vote as early as Wednesday that could see Barnier’s ouster.

RN members of parliament and the left combined have enough votes to topple Barnier and Ms Le Pen confirmed her party would vote for the left-wing coalition’s no-confidence bill on top of the RN’s own bill.

“Faced with this umpteenth denial of democracy, we will censure the government,” said Mathilde Panot of the left-wing France Unbowed.

“We are living in political chaos because of Michel Barnier’s government and Emmanuel Macron’s presidency.”

Ms Le Pen told reporters in parliament that Barnier, who only became prime minister in early September, had made things worse and needed to be pushed out.

“We are proposing a motion of no confidence against the government.”

The looming showdown unfolds against the backdrop of a fractured National Assembly, left in disarray after June’s snap elections delivered no clear majority.

President Emmanuel Macron had turned to Mr Barnier in September to navigate the impasse and address France’s soaring deficit.

Yet Mr Barnier’s proposed austerity budget — slashing 40 billion euros ($65 billion) in spending and raising taxes by 20 billion euros — has only deepened divisions, inflaming tensions in the lower house and triggering this dramatic political confrontation.

The use of the constitutional tool, called Article 49.3, allows the government to pass legislation without a parliamentary vote but leaves it exposed to no-confidence motions.

Opposition leaders argue that Barnier’s concessions, including scrapping an electricity tax hike, do not go far enough to address their concerns.

Ms Le Pen accused Mr Barnier of ignoring her party’s demands.

“Everyone must shoulder their responsibilities,” she said.

Mr Barnier warned of “serious turbulence” if the budget was passed, but critics dismissed his remarks as fear-mongering.

Mr Barnier urged members of parliament not to back the no-confidence vote.

“We are at a moment of truth … The French will not forgive us for putting the interests of individuals before the future of the country,” he said as he put his government’s fate in the hands of the divided parliament.

The parties announced their no-confidence motions after Mr Barnier said earlier on Monday that he would try to ram the 2025 Social Security Financing bill (PLFSS) through parliament without a vote as a last-minute concession proved insufficient to win RN’s support for the legislation.

Mr Barnier’s entourage and Ms Le Pen’s camp each blamed the other and said they had done all they could to reach a deal and had been open to dialogue.

A source close to Barnier said the prime minister had made major concessions to Ms Le Pen and that voting to bring down the government would mean losing those gains.

“Is she ready to sacrifice all the wins she got?” the source told Reuters.

Chaos ensues

Barring a last-minute surprise, if the no-confidence motion succeeds, Mr Barnier would have to tender his resignation.

His fragile coalition would be the first French government to be forced out by a no-confidence vote since 1962.

Mr Macron will remain president but will need to appoint a new prime minister to steer legislation through the fractured assembly.

He may ask Mr Barnier and his government to stay on in a caretaker role to handle day-to-day business while he seeks a new prime minister.

One option would be for Mr Macron to name a government of technocrats with no political programme, hoping that could help survive a no-confidence vote.

In any case, there can be no new snap parliamentary elections before July.

As far as the budget is concerned, if parliament has not adopted it by December 20, the caretaker government could invoke constitutional powers to pass it by ordinance.

However, that would be risky as there is a legal grey area about whether a caretaker government can use such powers. And that would be sure to trigger uproar from the opposition.

A more likely move would be for the caretaker government to propose special emergency legislation to roll over spending limits and tax provisions from this year.

But that would mean that savings measures Mr Barnier had planned would fall by the wayside.

A government collapse would also leave a hole at the heart of Europe, with Germany also in election mode weeks ahead of US president-elect Donald Trump re-entering the White House.

The uncertainty threatens to deepen France’s economic troubles and reverberate across the eurozone.

The political stand-off has unsettled financial markets in the eurozone’s second-biggest economy, with borrowing costs rising sharply amid fears of prolonged instability.

The spread between French bonds and the German benchmark widened further and a sell-off in the euro gathered pace.

Since Macron called snap elections in early June, France’s CAC 40 stock market index has dropped nearly 10 per cent and is the heaviest faller among top EU economies.

It closed flat on Monday after dropping more than 1 per cent earlier in the day.

The euro sank 0.7 per cent against the US dollar and broke below $US1.05.

AP/Reuters