French President Nicolas Sarkozy’s ruling UMP party party vowed to press ahead with his radical reform programme on Monday, despite a worse than expected showing in parliamentary elections.
Just a month after Sarkozy took office, the Union for a Popular Movement (UMP) secured a clear majority in the National Assembly in Sunday’s vote — but its number of deputies was down by more than 40 and the opposition Socialists made surprise gains.
In a major blow to the government, the powerful environment minister Alain Juppe failed to secure a seat in parliament and was therefore obliged to tender his resignation.
The mood in the UMP was subdued on Monday, even though senior members could argue it was the first time since 1978 that a ruling party has retained its majority in the Assembly.
Despite the disappointment, Prime Minister Francois Fillon insisted that that the election had delivered a “majority for action... What we have said, we will now do, because pledges made to the voter form the basis of national trust.”
The prime minister met Sarkozy on Monday to present his government’s resignation —  a formality after legislative elections. He was to announce a new list of cabinet members on  Tuesday, with a replacement for Juppe and the addition of several junior ministers.
Suggested reforms
The government is studying plans to increase VAT so as to cut social security charges on payrolls to make it cheaper for companies to hire.
Despite the setback Sarkozy now has the legislative muscle to press ahead with reforms to ease rigid labor laws, trim fat from the public service, cut taxes, slash unemployment and boost growth in the euro zone's second biggest economy.
Among measures due before the new parliament are tax breaks on mortgage interest repayments and overtime, a 50 percent cap on personal taxation, tighter immigration laws and stiffer terms for repeat criminal offenders.
Sarkozy is expected to move quickly to replace Juppe.

France’s power-couple split
Paris, The Guardian: Ségolène Royal, defeated Socialist presidential candidate, has made clear she has separated from her partner François Hollande, leader of the party, and that she will fight to take over the party from him.
Once France’s most important power-couple, the Royal-Hollande partnership and its rifts on policy and strategy dominated the Socialist election campaign.
In a book to come out on Wednesday, Behind the Scenes of a Defeat, Ms Royal asks that Mr Hollande, the father of her four children, is not described as her partner because "that is no longer the case".
Ms Royal is quoted as saying she had asked Mr Hollande "to move out of the house" and pursue his new love interest "which has been detailed in books and newspapers". She said she "wished him happiness" and they were on good terms. "We talk. We respect each other."
The couple met in 1978 but never married. In the campaign they frequently denied rumours they were to split. They began a law suit against other book authors for saying their relationship was in crisis. There was no comment from either on the news reported on TV, but party colleagues on live shows did not dispute it. Former Socialist prime minister Laurent Fabius said the breakup was a "private decision" which did not concern the party.
Mr Hollande is due to remain party leader until autumn next year but several Socialist officials suggest the leadership should be resolved this year. Ms Royal has said she would run to replace him if Socialists accept her programme for reform.