The French government last night survived a parliamentary vote of no confidence.
It had been triggered by Nicolas Sarkozy’s UMP party after current prime minister Manuel Valls used an arcane and controversial rule in the country’s constitution to push through reforms intended to boost growth.
France has been faced with a persistent low growth-low inflation scenario for about a year, even before the collapse in oil prices.
French inflation dropped into negative territory in January, official figures showed yesterday. The annual inflation rate fell from 0.1 per cent in December to minus 0.4 per cent in January. Three-month growth was only 0.1 per cent in the final three months of 2014.
Valls invoked Article 49.3 to push through pro-market reforms, drawn up by his economy minister Emmanuel Macron, without a parliamentary vote. He resorted to such measures as several MPs from his own socialist party were expected to vote against it, putting it at risk of being rejected. Macron is an ex-banker whose pro-market reforms have struggled for popularity within the party.
“The decision confirms that the socialist prime minister is struggling to rally his party behind important economic reforms,” said Vincenzo Scarpetta, a policy analyst at think tank Open Europe.
“Article 49.3 is an exceptional tool. The French Constitution establishes that, with the exception of the budget and of legislation concerning the financing of the social security system, this procedure can only be used one in each parliamentary year. In fact, Article 49.3 was last invoked in 2006.”
Macron wants shops to be allowed to open on more Sundays per year, open up regulated professions to greater competition and liberalise intercity bus transport. But the reforms do not alter the country’s 35-hour working week.
PLAYING BY THE RULES
■ Macron’s reforms include opening certain industries to competition and allowing shops to open on Sundays.
■ Article 49.3 in the constitution was used to push the reforms through.
■ It allows the government to pass reforms without a parliamentary vote.
■ Article 49.3 can be used only once per year and was last used in 2006.
■ It was feared the reforms would be shot down by members of his own party.