Bayrou targets social spending and unemployment insurance cuts

Sunday 10 August 2025 - 10:30

The French government, led by Prime Minister François Bayrou, has announced a plan to save €2 to €2.5 billion annually between 2026 and 2029 through reforms to the unemployment insurance system. By 2030, the target is to achieve at least €4 billion in yearly savings, according to a policy framework communicated to social partners.

These cost-cutting measures form part of a broader fiscal strategy unveiled in mid-July that aims to restore budgetary balance within four years. Key components include freezing social benefits in 2026—an "année blanche"—which would halt inflation-linked increases and suspend revaluations in various sectors.

Additional austerity steps involve eliminating 3,000 public sector jobs, not replacing every third civil servant who retires, and reducing the state's operating expenditures. The government also proposes new solidarity levies on top earners, a tax on small parcel shipments, and tighter controls against tax and social fraud.

Bayrou has turned to podcasts and YouTube videos to explain these reforms directly to the public, recognizing growing controversy. Opposition parties, including major unions, have condemned the plan as overly restrictive, warning of widespread social unrest.