France debt hits highest level since 1978

France debt heads for post-1978 high, finance ministry projects debt above 119% of GDP in 2026, 2027 election year budget cuts arrive late

France’s public debt is set to reach its highest level since 1978 this year, according to figures cited by Euronews from the French finance ministry and confirmed by the statistics agency Insee. The ministry projects debt at 119.3% of GDP in 2026, rising further to 121.7% in 2027, even as the government prepares a €54 billion package of budget adjustments and spending cuts for 2027.

The numbers matter in the eurozone because France is not a small outlier that can be quarantined. Euronews describes France as the bloc’s third most indebted member after Greece and Italy, with the debt ratio moving higher through what the ministry calls an “automatic” mechanism: a deficit that stays large enough that debt grows even without a new crisis. EU rules set reference points of 60% for debt and 3% for annual deficits; France’s deficit was 5.1% of GDP in 2025 and the government forecasts 5.4% for 2026, with a reduction to 5% pencilled in for 2027.

That gap between rulebook targets and political reality is now being managed as process rather than emergency. France has been under special EU monitoring for two years because of its deficit, and the government has submitted its draft 2027 budget to the High Council of Public Finances for evaluation. Euronews reports that some of the most sensitive choices — including whether to reduce tax breaks for pensioners — are being left to parliament, shifting the immediate ownership of pain from the executive to a wider set of actors.

The timing is also awkward. France holds presidential and government elections in 2027, and the planned tightening lands in the same calendar year as campaigning and coalition-building. The head of parliament’s finance committee is quoted objecting that cuts would hit “all population groups indiscriminately”, especially the poorest — a preview of how any consolidation package becomes a distributional fight once it leaves the spreadsheet.

Underlying growth assumptions are moving in the wrong direction. Euronews says France’s 2026 growth forecast has been revised downward amid weak consumer spending, and it links the broader economic hit to a surge in energy prices connected to the US-Israeli war against Iran. Higher energy costs squeeze households and raise the state’s own bill at the same time, making deficit reduction harder without politically costly measures.

France’s debt trajectory is now being debated in the language of avoidable crisis rather than inevitability. Amélie de Montchalin, who heads the High Council of Public Finances, says a fiscal crisis is “not certain or guaranteed” if France makes “swift and responsible choices”. The government’s own projections show those choices arriving in 2027 — the year voters decide who gets to take credit for restraint and who gets blamed for the bill.