French Finance Minister Roland Lescure stated that proposed budget measures from the Senate will not achieve sufficient deficit reduction, underscoring ongoing challenges in meeting fiscal targets. The comments come as France grapples with structural spending pressures and economic uncertainty.
- Deficit projected at 5.2% of GDP in 2026, exceeding EU target of 5%
- Senate's proposed spending cuts total €9 billion, deemed inadequate
- Rising social and wage costs expected to add €14 billion in 2026
- Debt-to-GDP ratio at 113.8%, above EU recommendation
- Yields on French 10-year bonds rise slightly post-speech due to market reassessment
France's finance minister, Roland Lescure, delivered a stark assessment of the Senate's recent budget proposal during his address at the Sueddeutsche Zeitung Economic Summit in Berlin on November 18, 2025. He emphasized that the plan, while attempting to rein in public expenditures, would fall short of narrowing the country’s projected fiscal deficit by the required margin. According to Lescure, current projections indicate the deficit will remain above 5.2% of GDP in 2026, despite the Senate's adjustments. The government’s official target is to reduce the deficit to below 5% of GDP by the end of the year, aligning with EU guidelines. However, Lescure noted that the Senate’s proposed cuts—estimated at €9 billion in non-essential spending—would only deliver a partial correction. These reductions are insufficient to offset rising social security costs and inflation-linked wage increases, which are projected to increase public spending by over €14 billion in 2026. Key figures underscore the challenge: France’s debt-to-GDP ratio stands at 113.8%, a level that remains above the EU’s recommended threshold. Without more aggressive reforms, including potential tax adjustments and deeper structural changes to public sector employment, Lescure warned that long-term fiscal sustainability is at risk. His remarks signal growing concern within the government about maintaining credibility with international markets and EU institutions. The divergence between the executive and legislative branches has intensified political scrutiny, particularly ahead of the 2027 parliamentary elections. Investors are closely monitoring fiscal signals, with French sovereign bond yields rising modestly following Lescure’s comments. Market participants now anticipate cautious upward revisions in future deficit forecasts, affecting both domestic investment and foreign institutional confidence.