December 27, 2024
Passing a Budget in Times of Legislative Paralysis – Verfassungsblog

Passing a Budget in Times of Legislative Paralysis – Verfassungsblog

The Legal Consequences of the Motion of No-Confidence Against the French Government

On December 4, the French National Assembly passed a motion of no-confidence against Prime Minister Michel Barnier’s government. This is an exceptionally rare occurrence, and its legal consequences are, by necessity, uncertain. What is indisputable, however, is that the very passage of this motion places the government into caretaker status, which considerably restricts its legal authority. One significant consequence is that, except for emergency legislation, all legislative business in both the National Assembly and the Senate is suspended.

This legal situation presents acute challenges for the two budget-related bills currently pending in Parliament since both bills must be passed before December 31. To address this, the caretaker government plans to invoke an emergency and table a “special bill” in the National Assembly at the end of this week. However, such a measure does not fit neatly within the categories of emergency financial legislation set out in the Constitution and the Organic Law.

Yet another caretaker government

The current political instability must be understood in the context of the events that unfolded in France earlier this year. On June 9, 2024, President Macron dissolved the National Assembly and called for snap elections. The newly elected Assembly is divided into three uneven blocs—broadly categorized as left-wing, right-of-center, and far-right—none of which secured enough seats to govern independently. From the outset, it was clear that such a configuration would inevitably lead to instability.

As just noted, the passage of a motion of no-confidence places the government into caretaker status. This is explicitly established in the Council of State’s (France’s supreme administrative court) Brocas ruling (CE, Ass., Oct. 19, 1962, Sieur Brocas): the adoption of a motion of no-confidence “entails the withdrawal of the Prime Minister and his government”. While the Prime Minister remains obliged to submit his government’s resignation to the President of the Republic (as Mr Barnier did on December 5), any delay on his part carries no legal consequences; the same goes for the President’s refusal to accept the resignation.

There is, therefore, an important distinction in the legal regime:  depending on whether the Prime Minister’s resignation is voluntary (as we know, it never really is) – in which case the caretaker period begins once the President signs the decree terminating the government’s office – or whether it is provoked by a motion of no-confidence. In 2024, France has seen four prime ministers and three caretaker periods of varying length – an unprecedented situation since at least 1948.

In France, a caretaker government is limited to handling “current business” (affaires courantes).  This means its authority is confined to (i) routine affairs with minimal discretion, and (ii) urgent matters (see CE, Ass., Apr. 4, 1952, Syndicat régional des quotidiens d’Algérie). Absent an urgent necessity, politically sensitive decisions are deferred until a new government is appointed.

An important consequence of the motion of no-confidence is the suspension of legislative business in both houses of Parliament. The reason is simple: legislative business (at least in plenary sitting) cannot continue without the government’s presence on the Ministers’ Bench. Except in emergencies (discussed below), a resigning government cannot speak from the Bench, as such actions are intrinsically political and contradict the principle of merely handling “current business”.

It is worth noting that the Constitutional Council has never had occasion to consider the legislative prerogatives of a resigning government. However, it is highly likely that the  Council would uphold the concept of “current affairs” as developed by the Council of State as well as by higher officers of both houses of Parliament.

Notably, this legislative paralysis affects not only government-sponsored bills but also private members’ bills, that is, bills tabled by MPs and Senators (propositions de loi). Thus, shocking as it may seem, Parliament cannot exercise its legislative authority without the presence of the government on the Bench.

What will happen to pending budget-related Bills?

When the motion of no-confidence was passed, two budget-related bills were pending in Parliament: The Finance Bill, currently pending in the Senate, and the Social Security Financing Bill (SSF Bill), which was the specific focus of the motion of no-confidence, and which remains pending in the National Assembly. Both bills must be passed before December 31 to align with the start of the new fiscal year on January 1.

The Finance Bill was not directly impacted by the motion of no-confidence. However, its examination in the Senate cannot resume until the new government is appointed. Once appointed, the government will have the option to resume discussion of all pending bills, including the Finance Bill.

Given that the time limit of 20 days set by the Organic Law on Finance Bills will be expired, the new government may be in a position to fast-track the bill’s adoption.  However, this could prove politically challenging since there is no majority in the National Assembly. This is why the current caretaker government is determined to table an emergency bill which would temporarily solve the political problem but raise significant legal questions.

The SSF Bill faces a more complex challenge. The motion of no-confidence was passed following the Prime Minister’s use of the (in)famous article 49(3) of the French Constitution. Roughly speaking, this provision allows the Prime Minister to engage the responsibility of his government on a bill: if a motion of no-confidence is not tabled, or if it is not adopted, the bill is considered adopted without a vote. Conversely, it is now commonly accepted that if the motion of non-confidence succeeds, the bill in question is rejected.

However, the rejection of the SSF Bill is not necessarily definitive. Just as the adoption of a bill through the Article 49(3) procedure is not definitive—except when it comes up for final reading, or when the text thus adopted is identical to the one previously adopted by the Senate— its rejection under the same procedure is similarly non-final unless it occurs during the final stage of the legislative shuttle or is mirrored by Senate rejection at the same stage. The rejection of a bill by either chamber at any stage, except the final one, does not terminate the legislative shuttle; the bill thus rejected is transmitted to the other house (or, in some cases, is re-tabled in the same house).

The SSF Bill has therefore not been definitively rejected by the National Assembly. The new government could easily submit the bill for a new reading in the Assembly based on the version initially approved by the Senate. Alternatively, the government could withdraw the bill and submit a new one, although the clock is clearly ticking. It could also bring the SSF Bill into force by ordinance as soon as it is appointed (Art. 47-1(3) of the Constitution), as the 50-day deadline for its definitive adoption elapsed on December 5. However, this move would undoubtedly carry significant political risks.

Towards emergency legislation

One scenario that could arise—and appears to guide the legal considerations of the caretaker government regarding the two bills—is the possibility that the “caretaker- period” may be prolonged, endangering the timely passage of a budget before the start of the 2025 fiscal year. Could such a scenario provide solid legal grounds for the actions of the caretaker government?

First, as we saw, it follows from the very notion of “current business” that the examination of the Finance Bill and the SSF Bill cannot continue under the aegis of a resigning government. A resigning government is further barred from using its regulatory power to bring them into force by ordinances. Such ordinances are an original aspect of French budget law: Article 47(3) of the Constitution provides that “should Parliament fail to reach a decision within seventy days, the provisions of the Finance Bill may be brought into force by Ordinances”. Similarly,  Article 47-1(3) applies a 50-day deadline for SSF Bills, which, as we have seen, has already expired. However, such ordinances would be beyond the competence of a caretaker government, and if the Council of State were called upon to exercise review upon them, it would most definitely strike them down. A newly appointed full-fledged government could invoke this mechanism, but doing so would be fraught with political risks  (the last time a budget was adopted in a similar – though not identical – way, albeit in very different circumstances, was in 1958).

To address this impasse, the caretaker government has decided to table a “special bill” to enable Parliament to adopt emergency financial measures to ensure the continuity of national life; it has received the go-ahead to do so from the Council of State in an advisory opinion published on December 10. The government has therefore invoked Article 47(4) of the Constitution (and Article 45(2°) of the Organic Law), which provides that “should the Finance Bill (…) not be tabled in time for promulgation before the beginning of that year, the Government shall as a matter of urgency ask Parliament for authorization to collect taxes and shall make available by decree the funds needed” to ensure the normal operation of the State: such is the function of a “special bill”. The conditions for its use are clear: it can only be tabled if the Finance Bill has not been tabled in time to ensure its enactment before the commencement of the 2025 fiscal year.

However, these conditions are not met: the 2025 Finance Bill was tabled well within the prescribed timeline (although its tabling, due for October 1, was delayed until October 10). If the government is appointed around December 16, there will still be enough time to complete the examination of the Finance Bill on time, even if it means exceeding the 70-day deadline by a few days. As previously discussed, the new government would also retain the option of enacting the Finance Bill through an ordinance if necessary.

Since the conditions set out for “special bills” by the aforementioned provisions of the Constitution and the Organic Law are not met, the bill that the Barnier government intends to table is therefore to be understood as a bill “having the same scope” as a special bill stricto sensu. There is a precedent for this, dating back to 1979. Following the Constitutional Council’s annulment of the 1980 Finance Act in its entirety (CC, December 24, 1979, n° 79-110 DC), the Constitutional Council accepted (CC, December 30, 1979, n° 79-111 DC) a provisional measure on the grounds of ensuring the “the continuity of national life” until a Finance Bill could be passed. This emergency bill had “the same scope” as a special bill stricto sensu, both in terms of its contents (a single article authorizing the collection of taxes) and its effects (the possibility for the government to open the appropriations by decree). At the time, this possibility was not provided for in any text—it is now included in Article 45 of the Organic Law, which outlines the procedure to follow if the Constitutional Council strikes down a Finance Bill in its entirety.

The forthcoming “special bill” appears to be of a similar nature. Its constitutional and legal foundation is tenuous at best, relying solely on the imperative of maintaining the continuity of national life; moreover, a caretaker government can only table urgent legislation anyway. Thus, any provisions included in the special bill must be rigorously justified by the emergency at hand.  For instance, the bill could authorize the collection of existing taxes or provisions permitting the State (and possibly social security institutions) to incur debt, but little beyond this scope. The Council of State has, incidentally, confirmed this in its aforementioned advisory opinion.

Yet, a problem remains: at this stage, it is difficult to speak of “emergency”, given that a new government is, at the time of writing, due to be appointed in the next week or so, and it is theoretically possible to complete the normal shuttle for both the Finance and SSF Bills. It is to be feared that recourse to the “special law” is a convenient way to sidestep, or even postpone, the normal budgetary legislative process rather than a measure necessitated by a genuine impossibility of passing the budget through regular procedures—as was the case in 1979.

Of course, if the caretaker period were to be prolonged until the end of December and beyond, the requirement of continuity of national life would require the tabling of such a bill. However, as of now, I respectfully argue that the circumstances do not yet meet the threshold of an emergency requiring such a measure.

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