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EU might get fooled by Orban, experts say

While the EU Commission is negotiating with the Hungarian government over the payout of the frozen EU recovery funds, local experts warn that they might try to fool the EU

By: EBR - Posted: Friday, July 22, 2022

From the EU’s Recovery and Resilience Fund (RRF), grants of up to €5.8 billion are reserved for Hungary, but money is yet to be paid out over concerns relating to corruption and the rule of law.
From the EU’s Recovery and Resilience Fund (RRF), grants of up to €5.8 billion are reserved for Hungary, but money is yet to be paid out over concerns relating to corruption and the rule of law.

by Janos Allenbach-Ammann

While the EU Commission is negotiating with the Hungarian government over the payout of the frozen EU recovery funds, local experts warn that they might try to fool the EU.

From the EU’s Recovery and Resilience Fund (RRF), grants of up to €5.8 billion are reserved for Hungary, but money is yet to be paid out over concerns relating to corruption and the rule of law.

In recent weeks, however, the Hungarian government started communicating that it was close to a deal with the EU Commission. Government representatives said they had agreed to several reforms to make it possible for the Commission to release the funds.

According to the Hungarian State Minister for EU affairs at the Hungarian Ministry of Justice Janos Boka, it was “a reasonable and feasible objective […] to close all outstanding issues in the budgetary conditionality procedure by the end of August.”

The EU Commission was more cautious, not giving a specific timeline for when the issues might be resolved.

“We have made progress on a number of issues,” a Commission spokesperson said. “There are a number of points that still remain open,” they added, specifying that these were mostly in the field of anti-corruption and adequate audit and control arrangements.

The EU Commission did not comment on the details of the negotiations with the Hungarian government.

Four measures to get access to the EU funds

Meanwhile, corruption experts warn that the proposed reforms should not be taken seriously. According to the Hungarian news site telex.hu, the Hungarian government was ready to reform in four points:

First, it would reduce the proportion of public procurement contracts with only one bidder, so-called single-bidder contracts, to below 15 per cent. Second, it would allow everybody to seek legal redress in court if the prosecutor’s office stops a corruption case. Third, it would introduce a social consultation round before introducing new legislation. Fourth, it would use a part of the EU funds to achieve energy independence.

“It’s ridiculous,” Istvan Janos Toth, general director at the Corruption Research Center Budapest, told EURACTIV.

“The single-bidder indicator works very poorly,” he said, arguing that it could not work in a deeply corrupt system. “In this corrupt system, we have a lot of cases in which there are two or three bidders for a public procurement contract, but all of them are corrupt,” he said.

Easily manipulated

According to Transparency International, Hungary has slid backwards in its yearly Corruption Perceptions Index ranking, landing at number 73. In the EU, only Bulgaria fared worse.

Professor Kim Lane Scheppele, who specialises in Hungarian constitutional affairs, confirmed that numeric targets like the 15% single-bidder indicator were meaningless since they could easily be manipulated.

“Anytime the EU Commission agrees to a statistical target, it is going to get fooled,” she told EURACTIV, arguing that the Hungarian government had a lot of tricks to manipulate its data.

The two experts were also largely unimpressed by the rest of the measures that might be taken to get access to EU funds.

Captured court system

For example, the measure that would allow anybody to seek legal redress at a court if the public prosecutor drops a case is aimed to bring corruption cases to justice. However, this would only work if the court system was independent from the government, which it is not, according to Scheppele.

“The courts have been captured,” she told EURACTIV, explaining that the head of Hungarian court of justice Andras Varga used to be the deputy of the controversial public prosecutor Peter Polt and that he has appointed many new judges. “This will accomplish nothing,” Scheppele said.

Meanwhile, the measure that would allow for a round of consultations ahead of the introduction of new laws was also criticised by Toth. The measure would aim to put some breaks on the legislative process that the Orban regime has often fast-tracked to increase its control over the institutions.

“The Hungarian government finances its own NGOs,” Toth said, arguing that any consultation would probably just listen to such government-financed NGOs.

European control via EPPO

Both Toth and Scheppele agreed that the only way in which corruption in Hungary could be fought was by means of joining the European Public Prosecutor’s office (EPPO). Twenty-two of the EU’s 27 member states joined the EPPO, with Hungary one of the five member states staying out.

EURACTIV understands that joining EPPO is not among the Commission’s demands in its ongoing negotiations.

However, with Hungary’s institutions being captured, scrutiny and control from the outside seem to be the last hope for fighting corruption. As long as this outside control is not given, the EU recovery funds are at risk of being misused.

“EU money is what keeps Orban in power,” Scheppele said, arguing against any unfreezing of the funds.

*first published in: www.euractiv.com

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