French Prime Minister Names New Budget Ministers

By Leigh Thomas

PARIS (Reuters) – French Prime Minister Michel Barnier has appointed a relatively unknown pair to address a significant budget deficit, prioritizing loyalty over political experience in choosing his finance and budget ministers.

Ending weeks of suspense, Barnier unveiled his ministerial lineup late on Saturday, selecting 33-year-old junior lawmaker Antoine Armand for the prestigious economy and finance ministry.

Barnier also appointed Laurent Saint Martin, 39, who heads the government office that promotes foreign investment in France, as budget minister—placing him directly under his oversight rather than under the finance ministry, marking a departure from tradition.

The two individuals, largely unfamiliar outside of Parisian political circles, are under immense pressure to reduce France’s budget deficit, currently nearing 6% of GDP due to a shortfall in tax revenues and higher-than-anticipated spending.

While they may lack political clout, economists believe their actions unlikely will jeopardize President Emmanuel Macron’s legacy of pro-business reforms and tax cuts if they manage to pass the 2025 budget.

“It’s a way of keeping policy continuity; they are faithful and will adhere to Emmanuel Macron’s political line,” stated economist Mathieu Plane with the OFCE economics think tank.

Armand, a political novice since becoming a Macron party lawmaker in 2022, and Saint Martin, who lost his bid for a second term in 2022, now face the challenge of leading the 2025 budget bill through France’s fractured parliament, where they may encounter fierce opposition that could potentially lead to a vote of no confidence against Barnier’s government.

Historically, the finance and economy minister has taken the lead in drafting and steering budget legislation, with the budget minister occupying a subordinate role. However, it remains unclear who will spearhead this endeavor.

Regardless of the arrangement, Armand will need to defend the government’s budget initiatives in Brussels, where France may find little sympathy as it requests extensions on cutting its budget deficit.

Outgoing finance minister Bruno Le Maire, renowned for his experience, told Armand at the handover ceremony, “You won’t find any miracle solutions for public finances in my desk drawer, only solid detailed proposals to cut spending.”

Armand faces substantial challenges representing France on international platforms like the G7 and G20, where he will sit alongside seasoned policymakers such as U.S. Treasury Secretary Janet Yellen.

HIGH STAKES BUDGET

Armand and Saint Martin will need to expedite the finalization of the 2025 budget bill, typically months in the making, due to be presented to lawmakers by October 1, though some flexibility may exist.

While finance ministry officials have conducted substantial preliminary work, the duo must navigate balancing tax increases and spending cuts in a manner that avoids public backlash.

The prior government has left plans for escalating taxes on energy companies and imposing taxes on large corporate share buybacks. However, broader tax increases are likely to face opposition from the far-right National Rally and Barnier’s conservative Republicans party, with Barnier stating that wealthiest taxpayers will need to contribute more.

Ultimately, they aim to address the budget gap, likely requiring unpopular spending cuts ranging from 20 to 30 billion euros ($22-$34 billion), depending on how quickly the government pursues deficit reduction, according to treasury estimates.

As Armand and Saint Martin contemplate possible tax hikes and cuts, both Barnier and Macron will closely monitor their actions, ensuring that current policies remain intact, as emphasized by OFCE’s Plane.

($1 = 0.8959 euros)