Financial emergency.
(Le Figaro, Jacques-Olivier Martin, April 22, 2026)
The government is right to contain spending by 6 billion to cope with the costs of the war in the Middle East and to refuse a new indiscriminate “quoi qu’il en coûte.” But this moderation does not change the reality: France continues to suffer from a serious imbalance in its public finances. The country has become the world champion of debt issuance and, if nothing changes, the trajectory is known: the edge of the cliff and then the fall, that is bankruptcy.
Of those 6 billion in war-related costs, two-thirds are already absorbed by the interest burden on the debt alone. These interests represent half of the expected public deficit, that is over 70 billion euros that will not go to research, police, schools, or infrastructure. Financial drifts deprive France of any room for maneuver to face the repeated shocks that have become the norm.
To sustainably reduce deficits and debt, it is necessary to attack the root causes: stop throwing money out the window, spend less but above all better, make the social model more efficient, and accept a simple truth: work more to support growth. The issue is no longer just economic but political, and it will be at the center of the 2027 presidential elections. Pretending to avoid this choice would simply be dishonest.
France has not changed course
“France has not changed in a few months. It still suffers from a serious imbalance in its public finances. […] Our ‘planet France’ has become the champion of debt issuance.”
Two-thirds of war costs absorbed by interest
“Of the 6 billion costs of this war, how many are attributable to the interest charge on our debt alone? Two-thirds!”
Interest devours half of the deficit
“These interests that we have to pay to our creditors weigh as much as half of the expected public deficit, that is more than 70 billion that will not go to research, police, schools, or infrastructure.”
Need for structural reforms
“To sustainably reduce its deficits and debt, France can only do so by attacking the root causes. Let’s stop throwing money out the window, spend less, but above all better.”
The ‘planet France’ champion of debt
“The ‘planet France’ has become the champion of debt issuance. And if nothing changes, the trajectory is known: the edge of the cliff, then the fall. In other words, bankruptcy.”
Budget 2027: Lecornu’s puzzle has already begun.
(Le Figaro, Julie Ruiz Perez, April 22, 2026)
The draft budget law for 2027 is still in its early stages, but this year’s budget is already causing problems for Sébastien Lecornu. The energy crisis triggered by the new war in the Gulf has caused an increase in spending through sectoral aid to mitigate the rise in fuel prices, amounting to 130 million euros per month. The government has also acknowledged that geopolitical tensions will raise the cost of debt by 3.6 billion euros. To offset every new expense, the executive has announced 6 billion in savings, but without providing any details.
In the afternoon, the Prime Minister presented a new support scheme for “large fuel users”: an average aid of 20 cents per liter for about 3 million French people among modest workers, nurses, and caregivers, as well as similar support for small construction companies starting in May. Measures for transporters, fishermen, and farmers will be extended or strengthened. Of the announced 6 billion in cuts, Public Accounts Minister David Amiel indicated only a general breakdown: 4 billion on the budgets of the State and its operators and 2 billion on the social sphere. Ministers have been invited to quickly identify room for maneuver within their departments.
Spring difficulties foreshadow autumn ones for the 2027 budget. The war has already raised interest rates and the cost of debt, as well as generating an additional cost of over 1 billion for the external operations of the armed forces and about 1 billion for contribution reliefs and inflation-indexed expenses. The government remains faithful to the “one euro of new spending, one euro of spending cut” rule to maintain the goal of reducing the deficit from 5.1% of GDP in 2025 to 5% this year.
Announced savings without details
“The government has confirmed it is ready to cut 6 billion euros in the 2026 budget to cope with the cost of the crisis in the Middle East and finance aid to the most affected sectors.”
Aid for large fuel users
“This aid intended for ‘modest workers’ would correspond on average to a reduction of 20 cents per liter for nearly 3 million French people, including ‘nurse-aids’ and ‘nurses.’”
Additional debt cost and military operations
“Geopolitical tensions will reinforce the cost of debt. For an amount of 3.6 billion euros. […] an ‘additional cost’ of more than 1 billion euros due to the ‘intensification of the external operations of the armed forces.’”
Growing complexity for the 2027 budget
“The budget equation is becoming more complicated this year, which clouds the horizon for the 2027 budget currently being prepared in Bercy.”
Euro-for-euro rule
“The executive has committed to economizing every new euro spent this year. […] ‘every new public spending that might be made necessary by the energy crisis’ will involve ‘a cancellation of a planned spending, euro for euro.’”
Budget 2027: Lecornu wants his last battle.
(L’Opinion, Matthieu Deprieck and Marc Vignaud, April 22, 2026)
While all eyes were on the Public Finance Alert Committee, Prime Minister Sébastien Lecornu has already begun preparing the 2027 budget. The cost of the Gulf crisis, estimated at six billion euros (of which 3.6 billion due to the rise in interest rates on debt, over one billion for external military operations, and about one billion for inflation and contribution reliefs), forced the government to announce 6 billion in “precautionary” measures: 4 billion on the State and its operators and 2 billion on the social sphere. For now, however, there is maximum uncertainty about concrete measures: talks of credit freezes, in addition to the traditional precautionary reserve, to maintain flexibility.
Lecornu rejects the idea of a simple transitional budget or a special law that would bring 2027 back to 2026, leaving everything to the new president elected in summer 2027. Instead, he wants a truly ambitious budget to present this autumn, with all the confrontations and threats of censure that this entails. The goal is to correct the image of an economic budget considered negative by most French people and leave a recognizable legacy to Macronism.
The Prime Minister also discards the idea of a negotiated waiting budget then adopted with article 49.3, as suggested by François Hollande. For three main reasons: it is necessary to find an additional 0.2 points of GDP to finance the increase in the Defense budget, avoid prolonging higher taxes (especially the surtax on corporate tax, which irritates large entrepreneurs), and continue reducing the deficit, because the spending dynamics mechanically worsen that of social security.
Lecornu rejects the transitional budget
“Sébastien Lecornu has no intention of letting the last budget of the Macron decade run. […] He wants a real budget with all that implies in terms of confrontations and threats of censure.”
Cost of the crisis: 6 billion euros
“The cost of the blockade of the Strait of Hormuz should cost six billion euros […] 3.6 billion from the rise in interest rates, over one billion for the army’s external operations, and about one billion for inflation and contribution reliefs.”
Six billion in announced savings
“Six billion in ‘precautionary’ measures have been announced, of which four billion for the State and its operators and two on the Social Security sphere to keep the deficit reduction target at 5% for 2026.”
The 2027 budget as a campaign indicator
“The examination of the 2027 draft budget law will be a campaign indicator. This will allow seeing which candidates truly believe in their chance of being elected.”
Warning on the risks of a waiting budget
“No one would understand that this last budget exercise, before the presidential election, is used as an ideological settling tool. […] Whoever aspires to preside over France would knowingly decide to put the first year of their five-year term in difficulty.”
(Excerpt from the newsletter by Giuseppe Liturri)
