New French PM gives up on predecessor’s idea to cut two public holidays
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New French Prime Minister Sebastien Lecornu is scrambling to form a Cabinet and draft a 2026 budget that can pass a deeply divided Parliament.
PHOTO: REUTERS
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- New French PM Sebastien Lecornu scrapped plans to cut public holidays amid budget concerns after France's credit rating was downgraded to A+.
- Lecornu aims for "creative ways" to pass a debt-slimming budget while avoiding instability, seeking parliamentary discussions with rival parties.
- Rising interest rates impact state finances and households, necessitating a "sound financial trajectory for France" to maintain sovereignty.
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PARIS – New French Prime Minister Sebastien Lecornu said on Sept 13 that he was dropping a proposal by his predecessor to cut two public holidays
Reacting to news that credit rating agency Fitch had downgraded France’s sovereign credit score to A+ on Sept 12 – the country’s lowest level on record – Mr Lecornu told local papers La Provence and Ouest-France: “We are paying for the instability.”
Fitch’s decision piles pressure on Mr Lecornu just days into the job
Mr Lecornu has already pledged to find “creative ways” to work with rivals to pass a debt-slimming budget while also promising new policy directions, after taking office on Sept 10.
“My mindset is simple: I want neither instability nor stagnation,” he said in his first interview since taking office.
“The future budget may not fully reflect my convictions... In fact, that’s almost certain!” he added, calling for “modern, frank and high-level parliamentary discussions” with the Socialist Party, the Ecologists and the Communist Party.
President Emmanuel Macron this week tapped Mr Lecornu, a conservative loyalist, to form a government after lawmakers ousted veteran centrist Francois Bayrou in a confidence vote over his plans for a €44 billion (S$66 billion) budget squeeze.
Mr Lecornu became Mr Macron’s fifth prime minister in less than two years, and faces a near-impossible task to pass a slimmed-down budget through Parliament – ordeals that led to the ousters of France’s last two prime ministers.
French debt has come under pressure since Mr Bayrou called the confidence vote in August, driving borrowing costs close to those of Italy, which carries the euro zone’s second-highest debt burden and a much lower credit rating.
“When interest rates rise, they have a direct impact on the state’s finances, but also directly on the lives of households and businesses. That is why the government will have to propose to Parliament to maintain a sound financial trajectory for France. It is also a question of sovereignty,” Mr Lecornu said. REUTERS
