Crucial government decisions threatened by censorship

The forced resignation of Michel Barnier’s government, following a no-confidence vote on December 4, has profoundly disrupted the legislative agenda planned for 2025. Several flagship projects are at risk of being scrapped or put on hold, with varying repercussions for the French people. While some feel relief and others express concern, here are the major measures currently on hold and their potential impacts.
 

1. A Larger Increase in Retirement Pensions
Initially, the government had planned to limit the pension adjustment to 0.8% as part of the Social Security Financing Bill (PLFSS) for 2025. With the vote of no confidence, this measure could be scrapped, giving way to an automatic adjustment based on inflation. As a result, pensions are expected to increase by 2.2 percent—a welcome boost for retirees facing rising prices.
 

2. Social Benefits and the RSA Indexed to Inflation
Similarly, social benefits and the RSA are expected to track inflation in the absence of a specific funding law. As of April 1, 2025, a 1.9% increase could be implemented, providing greater support to the most vulnerable households.
 

3. A Risk of Tax Increases for Millions of Households
The budget bill called for indexing the income tax brackets to inflation, a crucial measure to prevent tax increases linked to wage increases. If this bill is not passed by the end of the year, the tax brackets could remain frozen, exposing 17 million households to tax increases and making 380,000 previously tax-exempt households subject to taxation.
However, an amendment could reinstate this indexation through a special law, offering a possible reprieve.
 

4. The scrapping of the tax on unproductive wealth
Among the most controversial measures in the 2025 budget was the creation of a tax on unproductive wealth, targeting the wealthiest 0.3% of the French population. This tax would have brought in 2 billion euros per year. The postponement of this measure is now likely, leaving the ultra-wealthy beyond the reach of this new tax.
 

5. A Potential Drop in Electricity Prices
The government had planned to raise the electricity tax to 32 euros/MWh, up from the current 21 euros/MWh, which would have led to higher bills. With the veto, this increase could be suspended, allowing customers on regulated rates to benefit from lower prices, especially given the current decline in wholesale prices on the electricity market.
 

6. The Zero-Interest Loan (PTZ) Faces Uncertainty
The plan to expand the Zero-Interest Loan (PTZ) to finance real estate projects in areas with less competition may be scrapped. The PTZ would thus remain limited to new construction in specific urban areas, restricting access for many households seeking financing for a wider range of real estate projects.
 

7. Environmental Surcharges on Hold
Polluting vehicles and certain gas-fired boilers were set to be subject to higher taxes in 2025, as part of measures aimed at accelerating the ecological transition. With the government’s rejection of these measures, these surcharges and the VAT increase on gas-fired boilers could be scrapped, delaying efforts that are nonetheless crucial to addressing climate challenges.

An Uncertain Legislative Future
The postponement or cancellation of these measures raises a crucial question: What will be the priorities of the next government led by François Bayrou? While some households, retirees, or consumers may welcome these adjustments, others fear a negative impact on the energy transition or government funding. One thing is certain: the French will have to navigate a legislative environment marked by uncertainty in 2025.