After failing to find a parliamentary majority to back the 2025 budget, Barnier on Monday used the constitutional power known as Article 49.3 to force the first section of the budget, which deals with social security, through the Assemblée nationale.
Such a move, however, has triggered a vote of no-confidence that he could survive only if Le Pen's party abstains, with Barnier having little hope of finding any support left of centre.
A no-confidence vote will likely take place in the Assemblée on Wednesday.
"It is now up to you... to decide if our country should have a financial law that is responsible, indispensable and useful for our fellow French citizens, or if we are to enter into unchartered territory," Barnier told lawmakers.
The far-right Rassemblement National immediately responded via Twitter saying that they intended to support a no confidence motion, saying that "this bill, like the government, deserves to be censured".
The far-left La France Insoumise later confirmed that it intended to file a no-confidence motion.
Barnier, a conservative appointed by President Emmanuel Macron in September in the wake of an inconclusive general election, has no majority in parliament and has lived under the constant threat of a no-confidence vote that would, if successful, force him and his team to step down.
Key to any such vote is Marine Le Pen, the parliamentary leader of the far-right Rassemblement National (RN) that has expressed its opposition to several aspects of the government's 2025 budget plan, including the social security financing project to be debated in the Assemblée Nationale on Monday.
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These include planned cuts in employer social contributions, a partial end to inflation-indexing of pensions and a less generous prescription drug reimbursement policy.
If the government falls over Article 49.3, it would be the first successful such no-confidence vote since a defeat for Georges Pompidou's government in 1962, when Charles de Gaulle was president.
Le Pen reacted icily on Sunday after Budget Minister Laurent Saint-Martin said the government did not plan any further changes to the social security budget plan.
"We have taken note," she told AFP, calling the stance "extremely closed-minded and partisan behaviour".
She demanded in an interview with the Sunday edition of La Tribune that Barnier accept further "discussion" about her party's wishes.
"All Mr Barnier has to do is accept to negotiate," she said.
Otherwise, she warned, "the decision for a no-confidence vote will be his".
Her party is the largest single party in the 577-seat parliament, with more than 140 deputies.
On Thursday, Barnier had already scrapped a previously planned increase on an electricity tax, in a concession to critics.
Budget Minister Laurent Saint-Martin pointed to the work done on the budgetary proposals in a parliamentary commission ahead of Monday's debate, saying the current proposal was already the outcome of compromise between National Assembly deputies and members of the French upper house, the Senate.
"To reject this text is to reject a democratic agreement," he said.
The right-wing-majority Senate partly approved the government's 2025 budget Sunday, giving a green light to its revenue projections, in a vote boycotted by the left.
The Socialist party, part of the left-wing opposition, has already told Barnier that it will vote against him if he deployed article 49.3, saying it would be left with "no other choice".
Saint-Martin meanwhile warned that the fall of the government would raise the risk premium on French government debt that has reached rare heights because of the country's shaky financial situation.
France escaped a debt downgrade by S&P last week, with the ratings agency saying that "despite ongoing political uncertainty, we expect France to comply -- with a delay -- with the EU fiscal framework and to gradually consolidate public finances".
Barnier has promised to improve France's fiscal position by €60 billion in 2025 in the hope of cutting the public-sector deficit to five percent of gross domestic product, from 6.1 percent of GDP this year.
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