Why the special law could dent the state budget (and why it’s so difficult to quantify)

The text was definitively adopted by Parliament, but its impact on the French economy remains unclear. After the National Assembly, the Senate approved, Tuesday, December 23, the special bill aimed at continuing to provisionally finance the State. The special law is supposed to be only a temporary patch, pending an agreement on the 2026 budget. The principle is to temporarily renew the budget for the year 2025, to make it possible to raise taxes, pay civil servants and borrow. The device was thus qualified as “minimum service” by Amélie de Montchalin, Minister responsible for Public Accounts, Sunday on BFMTV. It thus makes it possible to avoid the impressive “shutdown” that the United States regularly experiences in the event of difficulties in reaching an agreement.

A stopgap which has a cost for the French economy: 11 billion euros, according to an estimate published in October by the Ministry of Public Accounts. Recently consulted on this subject, Bercy now explains that there is no stabilized costing yet, but that the previous special law, adopted in December 2024, after the censorship of Michel Barnier’s government, had cost 12 billion euros, without further details. Franceinfo attempts to take stock of what this special law could cost, or not.

The special law does not allow savings

The special law considerably limits the government’s means of meeting expenditures. In particular, it would prevent it from including savings measures, leading to “a deficit significantly higher than what is desirable”, thus denounced the governor of the Bank of France, François Villeroy de Galhau, on France Inter. “It does not include any savings measures, nor any tax measures”he lamented.

In detail, the time delay of certain measures would cost in particular 1 billion per month, Bercy explained. But, conversely, if the regime of the special law lasts only a brief moment and an agreement is reached in the first half of January, it will not cost “not much”, estimated the budget rapporteur to the Assembly, Philippe Juvin (LR), on BFMTV. The latter takes the opportunity to question the figure of 12 billion in the latest special law. “It was a way of dramatizing, I can’t find these 12 billion,” he declared again.

The note from the Ministry of Public Accounts for the month of October predicted in particular that with the special law, retirement pensions would remain temporarily indexed to inflation contrary to the wishes of the government, which would cost 3 billion. However, the freezing of pensions and social benefits was ultimately not included in the latest version of the Social Security budget (PLFSS), which was also voted on, which leads to nuance in this estimate.

The special law does not make it possible to release the new revenue initially planned in the PLF

Mechanically, the implementation of the special law prevents the emergence of new revenue for the State. Still according to this note from the Ministry of Public Accounts, this would correspond to a cost of 3 billion due to lower tax revenues. Worse still, according to the French Observatory of Economic Conditions (OFCE), this exceptional regime applied to the whole of 2026 would cause the State to lose 6.5 billion euros in revenue. According to the Minister of Public Accounts, with a special law applied all year round, the public deficit could be between 5.4% and 6% of GDP.

Many measures that were planned to save money are therefore suspended. As of January 1, there will be no tax of 5 euros on small parcels coming from areas outside the European Union, as initially desired in the PLF. The reform of the 10% reduction which retirees benefit from on their pension, which the government wanted to transform into a flat-rate reduction of 2,000 euros, “cannot be implemented, whatever the form, since it depended on adoption in 2025”also detailed Amélie de Montchalin. The expected gain for the State would however be one billion euros. Likewise, the differential contribution on high incomes had to be extended; it is, without a vote from the PLF, put on pause.

Of course, revenues do not increase during this period, but neither do expenses. The special law does not allow certain investments or expenditures to be made until the adoption of a finance law. The 6.7 billion additional credits planned for the army cannot be released immediately, the MaPrimeRenov’ window will remain closed, aid to wine growers is put on hold… Enough to qualify the total cost of this special law.

The special law could cause uncertainty, harmful to the economy

This climate of political uncertainty risks hampering growth: -0.2% of GDP point according to the ministry’s note, or 3 billion less revenue to be expected. This corresponds to the budget of the Ministry of Overseas Territories in 2025. And for good reason, the absence of financial texts would lead to renewed concern, particularly deleterious for economic actors who need to project themselves, with known and reassuring prospects.

But are economic players really stuck waiting for a hypothetical budget? Companies, accustomed to political instability since the dissolution of the National Assembly in 2024, are increasingly detaching themselves from the political context, according to the governor of the Bank of France, still speaking to France Inter. “The patient is resilient, recently estimated François Villeroy de Galhau, and we must give a tip of the hat to the courage of the entrepreneurs who continue to fight and to the courage of the French who work.” For the governor, there is now “a form of autonomy of economic life in relation to political life”. Enough to call into question, once again, any alarming figures.