Budget, unemployment insurance, New Caledonia… The hot issues that await Michel Barnier

The first of Michel Barnier’s priorities will be political. New head of government appointed does not completely close the transfer chain opened by diffusion. Now it is time to form a new government. And it is an understatement to say that the task promises to be difficult with the political disruption that will result from the expected legislative elections. The Prime Minister began his consultations this Friday morning, first with his predecessor Gabriel Attal, leader of the Ensemble pour la République group in the National Assembly, then with the main representatives of his political familythe leaders of the two LR parliamentary groups, Laurent Wauquiez and Bruno Retailleau, as well as Gérard Larcher, president of the Senate.

It will be difficult to find the balance to ensure majority support in the centre, between a presidential camp that has begun to free itself from the teachings of the head of stateand a right that has long refused any alliance with the macronie. Should we expect poaching from the social democrats? On France Inter, Olivier Faure, the first secretary of the PS, believed that it was not inconceivable that a socialist could join the new executive, while the New Popular Front is known as- then he would censor the government in the future.

Everything will be done under the guidance of the National Rally, whose mercy shown to the new Prime Minister may fall according to the people chosen for this or that package. We saw for example that Xavier Bertrand’s hypothesis for Matignon, Marine Le Pen’s bête noire in Hauts-de-France, had provoked an uproar from the RN representatives.

The budget crisis

The first legislative file on Michel Barnier’s desk, and not the least: the 2025 budget The timetable for presenting the financial bill for 2025 (PLF) is limited by the legal texts. However, the summer consultations were consuming valuable time for the executive, even though the outgoing government has started working on the first draft. The PLF must be submitted to the desk of the National Assembly before the first Tuesday in October, which means a presentation to the Council of Ministers no later than the week of September 25.

The room for maneuver for Michel Barnier, who wants to “add his own added value” to the files left by his predecessor, is particularly narrow. Gabriel Attal’s summit letters to members were His government plans to renew the 2024 budget in the same way, but with a new distribution of credits from one ministry to another. of 30 billion in 2025 to maintain the deficit reduction path presented in Brussels. In addition, on this level, France, which is subject to the European procedure for excessive deficitto present their attack plan to the EU by the end of September.

When power was transferred, the new Prime Minister promised France “the truth”, “first of all the financial debt and the ecological debt that is already weighing heavily on the shoulders of our children”. Where can he get the necessary savings? Should we expect a tax increase? Bercy was afraid this week of the increase in operating costs and investment costs of local authorities, but a decision in this direction would also mean the elimination of local elected officials – and part of Parliament. “You can imagine that with 3,200 billion in debt, we have to make savings. It will be a difficult budget, a delicate budget, but we must be confident,” explained Hervé Marseille, president of the central congress group in the Senate.

What is the future for unemployment insurance reform?

The controversial reform of Unemployment Insurance, which intends to tighten the conditions of access to the return to work allowance and to shorten the deadlines for compensation, was finally passed by Gabriel Attal after the first round of legislative elections. This last-minute change of heart was interpreted as a sign by the left to mobilize votes against the National Rally.

Union groups welcomed this ban, some, like the CFDT, even going so far as to speak of “abandonment”. At the time, Gabriel Attal had opened a path of “changes” and new negotiations between the social partners and the employers, who had not been able to agree on the contract setting the rules of compensation for the time 2024-2027. The unions wanted from employers in particular guarantees about the employment of elderly people.

The current rules still apply until 31 October. It remains to be seen whether Michel Barnier will be happy to reactivate the remaining reforms or whether he will let the social partners take control.

The agriculture department is still waiting for answers

“The uncertainty is terrible for an economic sector like ours. There were promises, which are still up in the air right now,” he dismayed Arnaud Rousseau, the president of the FNSEA at the end of August. To calm the discontent that shook the agricultural world at the beginning of the year, the Attal government promised a series of measures, some of which were left unfinished after the dissolution. What about, for example, the 100 million euro fund managed by the Public Investment Bank which should allow the most vulnerable farmers to get loans that the banks refused them?

Above all, the legislative process of the agricultural management bill, which was intended to address the structural causes of the crisis in the region, was stopped by the expected legislative elections. Barely accepted by the National Assembly, the text barely had time to go to the desk of the Economic Affairs Committee of the Senate. Will Michel Barnier put this text back on the agenda?

On Thursday night, the new head of government suggested that he would put special emphasis on the agricultural sector. “We expect the Prime Minister to tell the truth about the vital role played by economic players, large industrial companies, agricultural companies, and also fishing companies, including me “I had the honor of being a minister, ” he said. In any case, agricultural groups, who are not satisfied with the text that remains pending, hope to emphasize the balance. In a press release published this past Friday, the FNSEA and the Young Farmers union are asking Michel Barnier to take theirs. law for “undertaking in agriculture”.

The Caledonian crisis

Last spring, the reform of the electoral body in New Caledonia, which opposed the separatists, sparked violent riots in the islands, leaving around ten people dead including two gendarmes, against a background of economic decline. After several days of obstruction, the Head of State himself took up this matter, announcing the suspension of the constitutional review – without rejecting it – and the establishment of a mission aimed at a global agreement found with political parties on the island.

There, too, the dissolution halted the pacification process. At the end of June, one of the senior officers was responsible for the mission confided to the Public Assembly that the work was “behind de facto”. However, if the outbreak of violence was put down by the dissolution and the series of elections that followed, the situation remains particularly tense in “Caillou”. The High Commission of the Republic continues to maintain restrictive measures there, such as the curfew, the ban on gatherings and the ban on the sale of alcohol. Michel Barnier must find a way to resolve this file as soon as possible if he wants to avoid a new crisis.

The end of life bill, a victim of the new political arrangement?

Announced as the main social reform of Emmanuel Macron’s second five-year term, the bill opening up the right to assisted dying, as a result of long preparatory work, was being debated in the National Assembly when it was released involved. The deputies had just adopted article 5, which opens up the possibility of requesting aid by dying, when their work was interrupted.

Now, it is the new political balances that threaten the future of the reform. The RN, which now has 126 elected officers, was against it. Would Marine Le Pen’s party risk censoring the government on this text? In any case, it is unlikely that the left will vote for the bill, for such a move.

Note that the LR representatives, whose group is likely to play a key role in the new majority, also fought against the opening of assisted dying. Known to be conservative on social issuesMichel Barnier has never spoken publicly on the subject.

The sea serpent in retirement

Will Michel Barnier risk reopening this dramatic case? Whether he likes it or not, pension reform will return to the parliamentary news: the National Rally wants to take advantage of its parliamentary space, on October 31, to present a repeal proposal. Enough to guarantee a particularly lively series at the Palais Bourbon.

During the legislative campaign, the NFP wanted to restore the 2023 reform, to first return to a legal starting age of 62, before examining the possibility of returning to 60. If the question of the starting age is become an unstable dividing line between the parties on the left and the former majority, several voices will has risen within the presidential camp in recent weeks to declare that the reform was “impossible”, in the words of François Bayrou. We remember in particular that the measures dedicated to austerity and long positions had provoked strong debates in the hemicycle.

During the 2021 LR primaries, Michel Barnier defended postponing the retirement age to 65.

Purchasing power

Although inflation is returning to levels comparable to those before the war in Ukraine, the question of the purchasing power of France and labor wages has emerged as one of the main topics of the legislative campaign. The New Popular Front proposed a shock measure, widely criticized by other political groups: a minimum wage of 1,600 euros. On the side of the outgoing majority, Gabriel Attal wanted to increase Macron’s bonus ceiling and lower costs above the minimum wage to push employers to raise wages. The outgoing Prime Minister announced that he was leaving on his desk, for the attention of his successor, steps to work towards the “de-microcardialization” of France.

LR’s legislative agreement also mentions the reduction of costs, especially the exemption from taxes for overtime, but also the purchase of RTT, “retransmission of profit sharing, participation and employee shares” as paths for re-evaluation. If the new Prime Minister has put “work and the standard of living of France” among his priorities, he has not said more about his preferred options.