France’s political situation and prospects after the no-confidence vote

By Yves Bertoncini, Senior Advisor Kreab

The fall of Michel Barnier’s government after a no confidence vote of the National Assembly is an aftershock of the earthquake generated by Emmanuel Macron’s weird dissolution of the National Assembly on June 2024, which led to the fragmentation of the seats between 11 political groups and the absence of any clear governing majority.

1.1 Michel Barnier’s government was supported by a “central bloc” of around 212 deputies from the center (yellow) and the right (blue), i.e. only 36.7% of the 577 seats (see Graph 1). It was censured by the other political groups, based on a convergence between the left-wing coalition of the Nouveau Front Populaire / NFP (193 MP’s from red to pink), and the Rassemblement National /RN (126 MP’s in dark blue) and its allies (16 MP’s in brown), whose move was key to reach the majority required.

Graph 1 – French National Assembly in December 2024

2. The twofold immediate consequence of this no-confidence vote is of financial nature: it implies the rejection of the draft financial law covering social expenditures for 2025, but also the fall of the government, which is then no longer able to submit its other draft financial bill covering French State’s expenditures for 2025.

2.1 Only a newly appointed government will have the power to submit new comprehensive draft financial bills to the Parliament, while trying to adopt financial provisions by legislative orders or a “special law”, including by reconducting automatically the 2024 budget measures in terms of expenditures and resources/taxes.

2.2 Markets and investors could be more cautious and demanding with France within the next few days and weeks, then deteriorating even more its financial situation at a time when its political governance and economic attractiveness appear to be at risk.

3. The second immediate consequence of this no-confidence vote is of institutional nature: the President of the Republic is now called to appoint a new Prime Minister, whose challenging task will remain to square a political circle: he/she indeed will have to find a majority at the National Assembly or, at least, to avoid an immediate no confidence vote, so to have sufficient time to try and find ad hoc compromises able to convince around half of the MP’s, or at least to avoid their censure on the short run.

3.1 Emmanuel Macron is likely to appoint this new PM quite rapidly, given France critical financial situation but also the pressure put on him by most of the political forces, considering that he is responsible for the current stalemate.

3.2 Four types of political options are on the table as regards the new Prime Minister and government, by decreasing order of probability:

• • Another government led by a rightist politician, able to go on relying on the central bloc while finding ad hoc compromises with part of the left or the extreme right: Michel Barnier, Bruno Retailleau or Jean-François Copé are potential options;
  • A more “technical” government led by a non-elected leader able to reduce the impact of party tensions and battles for some months, such as Thierry Baudet (President of the French economic and social committee), Thierry Breton, a former CEO…
  • – A government led by a Macronist leader, such as Sebastien Lecornu (Defence Minister), François Bayrou (the Centrist Leader) or Jean Castex (a former PM), with a risk to contradict the verdict of the recent general election.
  • A government led by a leftist politician able to be supported/not censured by the central bloc, while “divorcing” from the radical left: Bernard Cazeneuve (a former PM) and Boris Vallaud (leader of the socialists in the Assembly) are mentioned.

3.3 For the composition of the new government, whose members must be approved by him, the President of the Republic could be tempted again to appoint “Macronists” to retain control of economic and financial issues, while ceding the management of other issues to the right (Home affairs) or to the left (Social affairs, Education…).

4. As soon as a new PM and government will be appointed, Emmanuel Macron should go on abandoning its temptation to micro-managing public policy down to the smallest detail, just like between 2017 and mid-2024 : he should revert to a strict reading of the French Constitution, according to which “ the Prime Minister determines and conducts the policy of the Nation ” – provided he/she is not censured…

4.1 The President of the Republic has no possibility of dissolving the National Assembly again before July 2025 – a deadlock is then possible should new Prime Ministers and governments be censured. More and more actors would then ask Emmanuel Macron to resign, even if no one can force him to do so.

4.2 New elections would not necessarily eliminate the political and partisan fragmentation that is at the root of the country’s current governance deficit. France will therefore remain in a highly unstable political situation for some quarters.

5. France brand new political situation is to have three other institutional consequences:

• the Parliament will keep on being more demanding and assertive, including via the direct launch of legislative initiatives (“PPL”);
• the “Senate” could appear as a more stable and pragmatic Chamber, able to amend and mitigate National assembly’s votes and to find sound compromises with it;
• the Government will try to use its own regulatory powers even more, since it doesn’t need to ask any vote or authorization to the Parliament to this end.