New French Prime Minister Sebastien Lecornu is dropping his predecessor’s proposal to cut back two public holidays as part of budget measures aimed at reducing the deficit.
Reacting to news that credit rating agency Fitch had downgraded France’s sovereign credit score to A+ on Friday – the country’s lowest level on record – Lecornu told local papers La Provence and Ouest France: “We are paying for the instability”.
Fitch’s decision piles pressure on Lecornu just days into the job as he scrambles to form a cabinet and draft a 2026 budget that can pass a deeply divided parliament.
Lecornu has already pledged to find “creative ways” to work with rivals to pass a debt-slimming budget while also promising new policy directions, after taking office on September 10.
“My mindset is simple: I want neither instability nor stagnation,” he said in his first interview since taking office.
“The future budget may not fully reflect my convictions… In fact, that’s almost certain!” he said.
He called for “modern, frank and high-level parliamentary discussions” with the Socialist Party, the Ecologists and the Communist Party.
President Emmanuel Macron this week tapped Lecornu, a conservative loyalist, to form a government after lawmakers ousted veteran centrist François Bayrou in a confidence vote over his plans for a 44 billion euro ($A78 billion) budget squeeze.
Lecornu became Macron’s fifth prime minister in less than two years, and faces a near-impossible task to pass a slimmed-down budget through parliament – ordeals that led to the ouster of France’s last two prime ministers.
French debt has come under pressure since Bayrou called the confidence vote last month, driving borrowing costs close to those of Italy, which carries the euro zone’s second-highest debt burden and a much lower credit rating.
“When interest rates rise, they have a direct impact on the state’s finances, but also directly on the lives of households and businesses. That is why the government will have to propose to parliament to maintain a sound financial trajectory for France. It is also a question of sovereignty,” Lecornu said.