Europe: Hungary faces cuts in EU funds worth billions

Hungary is at risk of billions in EU funding cuts due to widespread corruption in the country.

Europe: Hungary faces cuts in EU funds worth billions

Hungary is at risk of billions in EU funding cuts due to widespread corruption in the country. The EU Commission could decide on a corresponding proposal to the member states this Sunday, as the German Press Agency in Brussels learned from EU circles. It would be the next step of the so-called EU rule of law mechanism, which is intended to prevent the misuse of money from the EU budget.

EU Commission President Ursula von der Leyen emphasized in her speech on the state of the European Union on Wednesday that she wanted to take decisive action against corruption. "It is the duty and the foremost task of my commission to protect the rule of law," said the German politician.

Corruption widespread

The EU Commission has long criticized that corruption is widespread in Hungary. A July report spoke of "an environment in which the risks of clientelism, favoritism and nepotism in senior public administration are not addressed". Because the authority sees the risk of EU funds being misused as a result of these violations, it initiated the rule of law mechanism against the Central European country in April in a hitherto unique step.

A document by the EU Commission shows that the authority could propose to the EU states that they withhold up to 70 percent from several structural fund programs to promote disadvantaged regions. According to calculations by the Green MEP Daniel Freund, that could be around seven billion euros. From EU circles it was said that the numbers could still change. A deadline for the EU Commission expires next Wednesday.

Decision rests with EU countries

In addition, the authority will make recommendations on Sunday as to how the grievances in Hungary could be remedied. If Hungary implements all the recommendations, money might not have to be frozen in the first place. For the first time in a long time, the Hungarian government has shown some movement in the fight against corruption. Among other things, she wants to set up an independent authority to monitor the use of EU funds.

The decision to freeze billions for Hungary from the EU budget is made by the EU states. According to the recommendation of the EU Commission, you have up to three months to make such a decision. At least 15 countries with at least 65 percent of the EU population would have to agree.

In addition to the risk that EU funds intended for Hungary will be frozen, the country is also still waiting for money from the EU pot worth billions to cushion the economic consequences of the Corona crisis. The EU Commission and the Hungarian government have not yet been able to agree on a Hungarian plan for using the money. It is the only country whose corona construction plan is not yet in place.

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