France calls for tough budget cuts ahead of 2027 presidential election

France must resist the temptation to postpone difficult spending decisions until after next year’s presidential election, Budget Minister David Amiel has said, warning that the country cannot afford to let its already wide deficit deteriorate further.

“Repairing France’s public finances is the number one priority,” Amiel told the Financial Times (FT), comparing the current situation to a “powder keg” as he prepares the 2027 budget, which he is due to present to parliament in the autumn.

He urged candidates seeking to succeed President Emmanuel Macron after April’s election to put forward credible campaign proposals rather than court voters with “electoralist” spending promises.

The minority government led by Prime Minister Sébastien Lecornu plans to increase defence spending and protect green initiatives next year, while seeking to slow the growth of welfare expenditure.

However, amid weak GDP growth, the government has warned that it will have little room to reduce the budget deficit this year due to rising interest payments, the economic fallout from the Iran war and increased military spending. Rising unemployment is also adding to the pressure, reaching 8.3 percent in the second quarter, its highest level in almost six years.

The government’s current target is to bring the deficit down to 5 percent of national output by the end of the year, only marginally below the 5.1 percent recorded in 2025. France remains well short of its commitment to reduce the deficit to 3 percent of GDP by the end of 2029, a level required to comply with EU fiscal rules.

Higher borrowing costs pushed France’s debt interest bill to €34.5 billion in the first six months of this year, an 18.8 percent increase from the same period in 2025. Amiel said borrowing costs could rise by about €11 billion this year compared with last year, an amount equivalent to the entire budget of the justice ministry.

“Everyone knows that the root of our degraded public finances is the explosion of healthcare and pensions spending,” Amiel argued, attributing much of the pressure to France’s ageing population. “When you look at the increase in spending in the past 50 years, 80 per cent of it is social spending.”

By Jeyhun Aghazada