France's National Assembly overwhelmingly votes to suspend controversial pension reform

Lawmakers in France’s lower house of parliament, the National Assembly, approved a measure on Wednesday to suspend a controversial pension reform.

The votes, which passed by 255 to 146, followed a major concession by Prime Minister Sébastien Lecornu to the Socialist Party to avoid censure and ensure the government's survival.

Budget debates in France have taken on extra significance since President Emmanuel Macron’s snap election last year resulted in a hung parliament and earlier this year, lawmakers voted to remove Prime Minister François Bayrou after he called an unprecedented confidence vote over his controversial 2026 budget plan.

Investors and some of France's European partners have been watching the political turmoil closely as the country, which has had five prime ministers in just two years, struggles to rein in a budget deficit which has become the largest in the euro zone.

France's public deficit hit 5.8% of GDP in 2024, totalling €168.6 billion, a figure well above the maximum allowed by EU rules.

While lawmakers have approved the suspension of the pension reform, they will also need to back the whole social security bill in a final vote at a later stage for that to happen.

After a rocky start, Lecornu's second attempt at a government has made some headway, pushing parts of the budget through parliament thanks to costly concessions.

One of the biggest trade-offs was offering the Socialists a suspension of Macron's plan to raise the pension age to 64 which effectively keeps the retirement age at 62 years and nine months until after the 2027 presidential election.

"Three and a half million French people will be able to retire earlier. We are demonstrating that betting on consensus-building pays off," Socialist MP Melanie Thomin said after the vote.

But concessions on pensions and other spending cuts are likely to sharply undermine the government's target of trimming the deficit by €30 billion.

No revised estimate has been published yet, with the final shape of the budget still unclear.