EU budget: Hungary faces cuts in EU funds worth billions

Hungary is at risk of billions in EU funding cuts over widespread corruption in the country and other violations of the rule of law.

EU budget: Hungary faces cuts in EU funds worth billions

Hungary is at risk of billions in EU funding cuts over widespread corruption in the country and other violations of the rule of law.

Ursula von der Leyen's EU Commission could make a corresponding proposal to the member states on Sunday, as the German Press Agency in Brussels learned from EU circles. It would be the first time that the authority has proposed cutting EU funds because of violations of the rule of law.

However, there is still the possibility of a compromise with Budapest. The European Parliament therefore fears that the money will ultimately flow to Hungary. Commission chief Ursula von der Leyen emphasized on Wednesday that she wanted to take decisive action against corruption. She also mentioned the rule of law mechanism, which is intended to prevent the misuse of money from the EU budget. Hungary is so far the only country against which proceedings under the mechanism are ongoing.

"Clientelism, favoritism and nepotism"

The EU Commission has long criticized widespread corruption in Hungary, which has been ruled by Prime Minister Viktor Hungary for twelve years. A July report spoke of "an environment in which the risks of clientelism, favoritism and nepotism in senior public administration are not addressed". Another document from the authority primarily criticizes deficits in public procurement. There are "serious systemic irregularities, deficiencies and weaknesses in the public procurement procedures". A long list of other shortcomings follows.

Because the EU Commission sees the danger that EU money will be misused, it triggered the rule of law mechanism against Hungary in April. The proposal to cut money would be the next step in the process.

The document from the EU Commission shows that the authority could propose that the EU states retain up to 70 percent of 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.

In addition, the authority will decide on Sunday recommendations on how to remedy the grievances in Hungary, it said. If Hungary implements all the recommendations, the money might not be frozen in the first place.

Budapest wants to create new anti-corruption agency

The Hungarian government had recently shown some movement in the dispute with Brussels for the first time in a long time. In the past few weeks, she has held out the prospect of several measures intended to appease the EU Commission. Among other things, Budapest wants to create a new anti-corruption authority, significantly reduce the number of public tenders with just a single provider and end the parliamentary waving of often important laws in the 24-hour urgent procedure.

The responsible non-departmental minister, Tibor Navracsics, said in a television interview on Wednesday evening that the draft law for the anti-corruption authority is to be introduced to parliament at the beginning of next week. The heads of this authority should therefore be appointed in the context of public tenders. The appointment commission will be made up of international, technically recognized experts, and the procedure will be carried out in coordination with Brussels. The mandate of the authority, its competences and rights remain unclear to the public. Hungarian anti-corruption activists warn that the Orban government could dupe the Brussels authorities.

The Green politician Freund also has this fear. "We doubt that the list of agreed changes can fix everything that's broken in Hungary," he said. His FDP colleague Moritz Körner warned of a "big mistake".

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

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