France Requests EU Extension for Submitting Budget Deficit Plan, Reports La Tribune

PARIS (Reuters) – France has requested an extension from the European Commission for the deadline to submit a plan aimed at reducing its public deficit, pushing for more time beyond September 20 to align with the draft 2025 budget, according to a report by La Tribune du Dimanche, which cited the Finance Ministry.

The Finance Ministry warned that France’s budget deficit could worsen unexpectedly this year and the next unless additional savings are identified. This comes as the euro zone’s second-largest economy grapples with increasing political instability.

As a result of its financial situation, France is currently subjected to EU disciplinary proceedings. Incoming Prime Minister Michel Barnier faces significant challenges, as he begins to form a new government and prepares the budget by October 1, all while a possible parliamentary vote of no-confidence looms.

The Finance Ministry confirmed the request for an extension but did not disclose the length of time being sought. The reasoning behind the extension request was to maintain alignment between the deficit reduction plan and the 2025 draft budget.

In response, a spokesperson for the Commission indicated that while September 20 is stipulated in the regulations, member states can negotiate a reasonable extension with the Commission. However, they could not confirm the receipt of France’s request at this stage.

The financial challenges mean that Barnier’s administration may have to make difficult decisions between reducing spending, raising taxes, or risking credibility with both EU partners and financial markets.

President Macron appointed Barnier, a conservative and former EU Brexit negotiator, as Prime Minister on Thursday, following a two-month search after a legislative election resulted in a hung parliament.

Barnier stated on Saturday that he would not be able to perform miracles and emphasized his intention to restore order to France’s finances.

The leftist New Popular Front (NFP) alliance, the largest in parliament, together with the far-right National Rally (RN), holds a majority and could potentially unseat Barnier through a no-confidence vote if they choose to work together.

The RN has indicated tacit support for Barnier, outlining specific conditions to avoid backing a no-confidence vote, thereby positioning itself as a crucial influencer for the new government.

Marine Le Pen, the leader of the RN, expressed concerns during a public meeting in northern France, stating that her party expects Barnier to implement policies that recognize the 11 million voters who supported them. She warned that if the interests of the French people are overlooked, they would not hesitate to oppose the government.