|
IN BRIEF
|
Sébastien Lecornu, new Prime Minister, announced the withdrawal of the project to cancel two holidays, a highly contested measure inherited from his predecessor François Bayrou. This gesture of appeasement, made on September 13, 2025 in Mâcon, comes as France faces a downgrade of its rating by Fitch (from AA- to A+) and the necessity of drafting a credible 2026 budget. While withdrawing the cancellation of holidays, Lecornu opens the door to a debate on tax justice, while the MEDEF warns against any tax increase for businesses. Opposition parties denounce the economic line of the government, against a backdrop of a public deficit at 5.8% of GDP, debt at 113% of GDP, and yields at 3.47% for the ten-year OAT.
An act of appeasement at the start of the government’s term
Having been in office for less than a week, Sébastien Lecornu chose to break with one of the most contentious provisions at the moment: the cancellation of two holidays. Initially presented to contribute to the recovery of the deficit, the measure faced widespread rejection, from the union world to some political forces, as well as public opinion attached to the balances between work time and quality of life. The head of government acknowledged this blockage and now favors a method based on consultation.
The Prime Minister is aligned with a logic of enhanced social dialogue: he calls on partners to identify alternative funding sources for the 2026 budget. This shift also addresses the left, to which he extended a hand by expressing a desire to work on the issue of tax justice. The sequence reflects a desire to ease political constraints to focus on the sustainability of public accounts.
Why the idea of holidays crashed mid-flight
Estimated at around €4.2 billion in revenue for 2026, the cancellation of two holidays was originally meant to help fill part of the funding gap. However, the economic calculation faced a high social and political cost: the impact on collective benchmarks — bridges, extended weekends, family rituals —, the effect on tourism and consumption, and the perception of an effort weighing more on employees than on other categories. By renouncing, the government seeks to avoid a lasting social crisis and to preserve the dynamics of sectors sensitive to holiday schedules.
The French Prime Minister abandons his project to reduce two holidays: budgetary and fiscal implications
The puzzle of the 2026 budget after the downgrade
The decision comes on the heels of a serious warning: Fitch has downgraded France’s sovereign rating from AA- to A+, warning that the debt could continue to rise until 2027 without firm action. The debt market had partially anticipated this scenario: the yield on ten-year government bonds rose to around 3.47%, a level close to that of some more fragile eurozone countries. Immediate consequence: an increased financing cost for the State, while the public deficit remains at 5.8% of GDP and the debt at 113% of GDP, well above the European ceilings of 3% and 60%.
In this context, the question is no longer just about finding savings, but proving the credibility of a trajectory. The executive will need to articulate structural reforms, prioritize spending, and identify targeted additional revenues, without undermining the emerging growth and considering a parliamentary governance that is likely to be minority.
The path to fairer taxation and the MEDEF lock
When questioned about the possibility of a tax on great wealth or a contribution targeting the ultra-wealthy — sometimes referenced via the so-called Zucman proposal — the Prime Minister did not take a stand, but does assume opening the debate on tax justice. In response, the MEDEF warns that it will mobilize against any tax increase impacting businesses. The equation is delicate: preserve competitiveness, ensure the attractiveness of the territory, and guarantee a distribution considered more equitable of the effort.
The announced method relies on a rapid consultation with social partners, local authorities, and representatives of exposed sectors. The government promises to examine “options” without taboos, but with a compass: to preserve employment and investment, reduce the deficit, stabilize the debt, and not break the still fragile recovery.
The French Prime Minister abandons his project to reduce two holidays: political repercussions
A Parliament without a majority and an elusive reform
The sequence fits into a tense institutional climate: the attempt to adopt an austerity budget cost the previous head of government, François Bayrou, his position following a failure during a confidence vote. Now, the executive must navigate a Parliament without an absolute majority, where each compromise could weaken the ambition of spending cuts and revenue increases. The budgetary march remains as much political as it is economic.
Oppositions in battle order and tension in public debate
Leaders of the far right as well as those of the radical left blame the downgrade on Emmanuel Macron‘s line. Marine Le Pen argues for a “break” with what she calls toxic incompetence, while Jean-Luc Mélenchon calls for the end of a “macronism” deemed harmful to the country. Within the outgoing majority, some voices are worried: Bruno Retailleau believes that the downgrade sanctions decades of erratic budget management and chronic instability. The battle for the public narrative promises to be intense, with everyone seeking to set the agenda and mark the credibility ground.
The French Prime Minister abandons his project to reduce two holidays: effects on society and the real economy
Public holidays, productivity, and quality of life: the French balance
Public holidays hold a unique place in the social pact: they structure family life, support local economies and tourism, while providing a break for sectors under significant pressure. In macroeconomic terms, their cancellation can generate a short-term effect, but with questionable externalities on consumption, hospitality, and local commerce. By maintaining these benchmarks, the government chooses social stability and hopes to foster a trust conducive to household investment.
In a country where bridges and extended weekends enliven cultural and tourist life, the holiday calendar influences season and territory attendance. The issue is not only the number of days, but the organization of time in service of a sustainable economy and shared well-being.
Tourism, leisure, and purchasing power: contrasting trends
The maintenance of holidays could amplify domestic and short-term mobility. Professionals already anticipate a resurgence of interest in “flash” stays and themed getaways: a weekend in Las Vegas for entertainment lovers, or conversely more sober retreats based on an eco-responsible project in the heart of nature. Families are weighing between local activities and organized summer trips, depending on their purchasing power.
Internationally, some trends echo budget constraints: in the United States, an increasing share of households are opting out of vacations due to rising costs. In France, the redefinition of priorities is leading many travelers to seek affordable destinations for 2026, in a logic of resilience in tourism and better allocation of leisure spending.
The French Prime Minister abandons his project to reduce two holidays: the next steps in the calendar
Rating on the horizon and growth trajectory
Beyond Fitch, attention turns to S&P Global, which is set to update its rating in the fall. The government relies on rigorous execution and clear trade-offs to reassure the markets. According to INSEE, growth could reach 0.8% in 2025, a modest forecast but slightly better than the previous estimate. However, this uptick alone will not be enough to resolve the imbalances: coherent, clear, and socially accepted decisions will be necessary.
Consultation, method, and budgetary direction
The executive’s priority is now to build a social contract to exit the budget crisis. Thematic workshops will quickly gather employer and union representatives, sectoral experts, and local elected officials to identify quantifiable levers: tackling inefficient niches, optimizing public spending, targeted investments with proven multiplier effects, and revenue options that respect equity and competitiveness. The abandonment of two holidays establishes a political benchmark; the challenge remains to draft the trajectory that will reconcile budgetary responsibility with social cohesion.
