Three former EU commissioners have turned to European Commission President Jean-Claude Juncker in an open letter to cut off funding to Hungary until it reinstates basic democratic freedoms and takes actions against corruption.
”As signatories to this letter, we ask the European Commission to temporarily suspend payment of all EU funding to Hungary, with the exception of funding provided directly by the Commission (i.e. without the intermediary role of the Hungarian government), says the letter, signed by Hans Eichel, Germany’s former finance minister, and three ex-EU commissioners: Pascal Lamy, Franz Fischler and Yannis Paleokrassas.
The signatories accuse the Orban government of curtailing press freedom, they say universities have lost their independence, and key public institutions have been “de facto taken over” by the ruling Fidesz party.
Harassment and smothering of civil society organisations have been going on for years, they say. Hungary has passed a controversial regulation on NGOs and an amendment to the higher education act, both targeted indirectly against Hungarian-born philanthropist George Soros.
The Central European University, founded by Soros, and a number of NGOs receiving financial support for him have come under fierce attack from the government and its media. Brussels have mounted pressure on Hungary by launching infringement procedures but the cabinet remained adamant and have not revoked the legislation.
It is also telling that the Hungarian government has refused to join the EU’s key anti-corruption initiative, the European Public Prosecutor’s Office, the EU official said. Hungary's Prosecutors' Office has ordered investigations only in a handful of cases when government parties were involved in corruption cases.
Targeting civil groups, such as Transparency International, which aims to uncover corruption and bribery, begs questions about the government's commitment to target corruption, opponents note, adding that the scale of the problem has reached new heights as corruption has become institutionalised.
Business circles close to the prime minister, such as Felcsut mayor Lorinc Meszaros, have dominated in winning state contracts. Meszaros has amassed immense wealth in just a couple of years since Viktor Orban severed ties with Lajos Simicska, who served as treasurer for the Fidesz party and oligarch for more than two decades until a very public fallout in the aftermath of the 2014 election.
Hungary’s worsening record was reflected in the latest Corruption Perceptions Index (CPI) of Transparency International, which showed the country slipping 7 places to 50th place.
The EU heavyweights voice concern over the government's practice of paying out EU funds in an accelerated fashion, before the 2018 general election. ”The rapid disbursement leads to inefficient use of EU money, and greatly increases the risks of corruption”, they add.
The former EU commissioners recommended a temporary cessation of EU funds, which can be restored as soon as "basic democratic freedoms are reinstated and corruption counteracted".
“We strongly believe that this is also a pre-condition for continuing EU funding to less developed regions in the period following 2020 in light of growing resentment all over Europe about the inefficient and improper use of European Union funds,” they add.
Hungary's economy relies heavily on EU funds as more than 95% of public investment projects receive EU co-financing. The slowdown in money transfers from Brussels last year has led to a sharp 20% decline in investments and a meagre 2% GDP growth.