Hungary is at risk of losing EU billions

Brussels (dpa) – Due to corruption and other violations of the rule of law in Hungary, the European Commission has proposed cutting payments of around 7.5 billion euros from the EU budget to the country. The money is not sufficiently protected against misuse in Hungary, said EU Budget Commissioner Johannes Hahn on Sunday. It is the first time that the Brussels authorities have taken such a step because of deficiencies in the rule of law in an EU country.

At the same time, however, Hahn acknowledged on Sunday that Hungary had recently made 17 commitments to eliminate the deficits. These are steps in the right direction, but they also need to be implemented. It is now up to the EU states to follow the EU Commission’s proposal. In order to actually freeze the 7.5 billion euros, at least 15 countries with at least 65 percent of the EU population must agree. On Sunday, however, the Hungarian government was convinced that things would not go that far.

The EU Commission accuses Hungary of doing this

For years, the EU Commission has been accusing Hungary under Prime Minister Viktor Orban of undermining EU standards and fundamental values. The authority launched a number of infringement procedures and sued Hungary several times before the European Court of Justice – without achieving a rethink in Budapest.

The July report on the state of the rule of law in the EU states reads accordingly devastating: There are shortcomings “in relation to lobbying, revolving door effects and party and election campaign financing”; independent mechanisms to uncover corruption were not sufficient; there is talk of an environment “where the risks of clientelism, favoritism and nepotism are not addressed in senior public administration”.

And that’s not all. From Brussels’ point of view, the situation is getting worse and worse. The European Parliament initiated proceedings under Article 7 of the EU treaties against Hungary in 2018 because it saw threats to democracy , the rule of law and fundamental rights in the country. On Thursday, in a symbolic move, MPs agreed that Hungary would be a full-fledged democracy.

This is regulated by the EU rule of law mechanism

The EU rule of law mechanism is intended to stop this development. The instrument is intended to ensure that violations of the principles of the rule of law no longer go unpunished. It is crucial that this threatens to misuse EU funds.

In April, the EU Commission initiated such proceedings against Hungary for the first time ever. Specifically, according to Sunday’s proposal, 65 percent of three programs to promote disadvantaged regions are to be retained: around 7.5 billion euros.

The Hungarian government did not allow itself to be diverted from its course for a long time. Until June, she did not even address the concerns of the EU Commission. But then the agency sent a letter to Hungary outlining how much money the country could lose. What followed was an unprecedented willingness to talk on the part of the government. “Financial pressure is obviously having an effect,” said Hahn.

Budapest tries to give in

Specifically, in recent weeks Budapest has announced, among other things, that it will set up a new authority to fight corruption. The handling of EU funds is also to be made more transparent and monitored more closely. The proportion of public tenders with only one bidder is to be reduced and cooperation with the EU anti-fraud authority Olaf is to be strengthened.

These measures are a paradigm shift, said Hahn. At the same time, he pointed out that so far these have only been promises and that important details have yet to be determined. Hungary intends to inform the EU Commission about the implementation of the measures by November 19. Budapest intends to bring the first law into parliament as early as this week.

However, Hungarian anti-corruption activists warn that the Orban government could dupe Brussels. And warning voices are also coming from the European Parliament. “It is fatal that Viktor Orban can still avert these sanctions before the end of the year with a few sham reforms,” said Green MP Daniel Freund. Moritz Körner (FDP) spoke of the fact that the countries should not be fobbed off “with quickly decided paper tigers”. “Orban has lost the right to a leap of faith.”

EU could extend the deadline

However, if Hungary implements all of its commitments, the EU Commission should recommend not cutting the funds after all. Hahn already said on Sunday that the implementation of the Hungarian commitments would take a while. Therefore, the Council will be asked to extend the deadline for a decision from one month to the maximum of three months.

Hungary’s chief negotiator Tibor Navracsics said at a press conference in Budapest on Sunday that the threatened funding cuts would not come about. “We didn’t make commitments to fog up the European Commission.” The Hungarian government would not dream of failing to fulfill the commitments it had made.

Should Hungary actually implement the reforms, they could also solve another problem for Orban. Because the EU Commission is currently blocking several billion euros in corona aid. It is the only country that has not yet been able to agree on a plan for how the money will be used with the EU Commission. There could be movement here too.

© dpa-infocom, dpa:220918-99-805005/7

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