Hungary demands time, as EU weighs significant fund freeze

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BRUSSELS (TSWT) — Hungary needs time and urges its European Union partners to be “tolerant,” the justice minister said on Tuesday, after the bloc’s executive recommended suspending billions of euros in funding due to concerns about democratic setbacks and the possible mismanagement of EU money.

Justice Minister Judit Varga said Hungary has proposed 17 measures that are “able to allay all concerns”, voiced by the European Commission. EU Budget Commissioner Johannes Hahn advised last weekend to freeze EUR 7.5 billion (dollars) of Hungarian EU funds.

“It takes time, because even if there are accelerated procedures for passing laws and amending legislation, you have to create new institutions. For that you have to hire new staff,” Varga told reporters in Brussels. She said she expects Hungary to have until mid-November to show that it is on the right track.

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The commission took unprecedented action on Sunday by recommending that Hungary’s 26 EU partners vote to suspend payments “in order to protect the EU budget and the EU’s financial interests against violations of the rule of law principles.” in Hungary”.

The commission’s concerns focus on public procurement — purchases by the state of goods and services or for the implementation of projects using EU funds — in particular that about half of the tender procedures involved only one bidder.

Critics say the award of such contracts has enabled Prime Minister Viktor Orban’s nationalist government to channel large sums of EU money into the companies of politically connected insiders.

The committee is also “seriously concerned about the detection, prevention and correction of conflicts of interest”, and is reluctant to see EU money invested in a number of public interest trusts that manage significant funds, particularly in the field of education .

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Despite the concerns, Hahn welcomed Hungary’s offer to resolve the issue and said the proposed corrective actions are “going in the right direction”. EU member states have one month to decide whether to freeze the assets, but can extend that period to two months in exceptional circumstances.

Varga called on Hungary’s EU partners to be “tolerant, positive, constructive and forward-looking” because the main aim of the commission’s so-called rule of law action is “prevention and not punishment”.

“There is no danger,” she said.

EU lawmakers see it differently.

“It is fatal that Viktor Orban can avert these sanctions before the end of the year with some pseudo-reforms,” ​​said Germany’s Green Daniel Freund, a leading rule of law lawmaker. “A bold attitude is needed, not just some improvements in Hungarian procurement law.”

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By contrast, officials in Orban’s government have portrayed the commission’s decision as a victory and emphasized their commitment to pushing through reforms they believe will free up the funds.

In a tweet on Sunday, the Prime Minister’s political director Balazs Orban called the decision “good news”. He wrote that Budapest “will fulfill 100% of its obligations and submit the necessary bills to Parliament so that there will be no obstacles to finalize the discussions and receive EU funds within 3 months.”

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Justin Spike contributed to this report from Budapest, Hungary.

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