Barnier abandons electricity tax rise amid political turmoil

In France, the government, led by Prime Minister Michel Barnier, recently announced its decision to abandon plans for a tax increase on electricity. This decision comes in the wake of intense pressure from the far-right National Rally, led by Marine Le Pen, and other opposition parties threatening to destabilize the government. The context for this concession lies in the ongoing debate over the proposed 2025 budget, which aims to address France's increasing public deficit through €60 billion in tax increases and spending cuts. As Barnier works to maintain his position, he faces the possibility of a confidence vote as early as next week, should his government's budget not proceed through parliament smoothly. The political landscape in France has become highly fragmented following the snap parliamentary elections that President Emmanuel Macron called earlier this year in June, resulting in a hung parliament composed of warring factions: the left, the centre, and the far-right. Barnier's government, which is a minority administration, was formed in response to this political divide, and it has since struggled to gain consensus on key issues, including the contentious budget proposal. Le Pen's National Rally party remains a significant player in the political arena, presenting itself as a stabilizing force amidst the chaos that followed the parliamentary elections. By refraining from joining left-wing parties in a vote of no confidence against Barnier, the National Rally has, for the time being, held back on further political crises. Barnier's decision to scrap the electricity tax hike is seen as a concession to Le Pen's party and reflects the delicate balancing act he must perform to keep his government afloat. As opposition severity grows, Barnier may resort to invoking article 49.3 of the French constitution, a provision that allows the government to pass legislation without a parliamentary vote, particularly for the social security parts of the budget. While this tactic could enable the government to push some measures through efficiently, it raises the ante for a potential no-confidence vote as opposition parties unite to challenge the administration. Foreign Minister Jean-Noël Barrot cautioned that should the government collapse, the repercussions would be far-reaching, particularly given the current geopolitical climate. The situation remains tense, with key elements of the budget yet to be presented, and added complications ahead. Le Pen's party is also facing its own legal issues, with a verdict expected in March 2025, complicating their position in the coming months. Public sentiment has shifted as well, with recent polls indicating that if Barnier's government were to fall, a significant portion of the electorate believes Macron should resign. As France navigates through these tumultuous political waters, the focus remains on whether Barnier can maintain stability in a government under increasing pressure from all sides.