PARIS (Reuters) – French Prime Minister Michel Barnier must make more budget deals to avoid a motion of no confidence that could topple his government, National Rally MP Marine Le Pen said on Sunday.
Le Pen has given Barnier until Monday to agree to the National Rally (RN) budget or face the threat that they will support a motion of no confidence in his government, which could lead to its collapse.
“A vote against (the government) cannot be avoided. What Barnier should do is accept negotiation,” said Le Pen in an interview with La Tribune newspaper.
“There were discussions two weeks ago, but it is clear that things have not progressed as we would like,” he added.
Barnier has already dropped a planned electricity tax increase last week, but the RN also wants him to raise pensions in line with inflation and has aimed to raise the money below inflation to save money.
RN is also not happy that the government may increase the tax on electricity and wants to reduce France’s contribution to the budget of the European Union among other demands.
The standoff could come to an end as early as Monday if Barnier has to use aggressive constitutional powers to push through a social security funding bill, which could trigger a motion of no confidence on the left.
To survive a fractured lower house vote, Barnier needs the RN to hold back, otherwise his government and the budget bill could fall, plunging France into political crisis.
Finance Minister Antoine Armand warned in the weekend newspaper Le Journal du Dimanche that it would mean that a special emergency law would have to be passed to ensure that there would be a budget at the beginning of the year.
But it could override spending limits and tax provisions from this year, meaning pensions will be squeezed and tax caps will rise for 17 million people as no one can adjust for inflation.
Growing uncertainty over the French budget and the future of its government has put French debt and stocks under pressure, pushing the risk premium on government bonds to a 12-year high last week.
Standard & Poor’s offered some relief on Friday, leaving its AA rating on France’s debt unchanged even as it raised doubts about whether France could stick to the government’s deficit reduction targets.
