Hungarian lawmakers pass bill limiting parliamentary oversight on budget

By bne IntelliNews March 30, 2016

The Hungarian parliament passed a bill on March 30 that will open the way for the government to redirect budgetary funds without the consent of lawmakers. The opposition has asked President Janos Ader to block the bill.

The opposition presumably hopes that Ader, a long term ally of Prime Minister Viktor Orban, still feels in rebellious mood. The president has blocked two controversial bills this month. Both of those issues were also under discussion on March 30.

The budgetary bill was just starting the proces however, after parliament received the proposal on the bill on February 26 from Janos Lazar, the minister overseeing the Prime Minister’s office. The amendment would apply to the Public Finances Act, and enable the government to make decisions on funding via government decree, and without officially modifying the budget.

The bill allows the administration to shuffle the budget for any purpose. Currently, reshuffling budget appropriations requires parliamentary approval, but with the amendment in place, the government will be able to circumvent both the lower house and the Fiscal Council, which oversees the budget.

Unsurprisingly, the amendment bill drew fury from the opposition. Egyutt claimed that by passing the bill, the ruling Fidesz party has ceased maintaining even a semblance of democracy and parliamentary governance. The Socialist Party asked Ader to send the bill for review to the Constitutional Court.

The president did just that earlier this month with a bill seeking to partially close the books of the Magyar Nemzeti Bank (MNB) to public scrutiny, particularly concerning the central bank's several charitable foundations, through which many purchases of property and art have been made in recent years. The Constitutional Court’s decision is expected to be announced on March 31. Should the court find that the legislation is not in line with fundamental law, it will be sent back to parliament for further discussion.

In a sign that such an outcome is likely, Hungary’s supreme court - the Curia - ruled on March 30 against an MNB foundation, insisting that both the central bank and its foundations use public funds, and information on their use should be made available to the public. Although the Curia's decision is independent from the Constitutional Court's review, it would be surprising if the two institutions came to different conclusions regarding MNB funds.

Meanwhile, Ader also sent legislation on a new state housing scheme back to lawmakers on March 24, citing a lack of transparency and weak guarantees for stakeholders. Having received the president’s comments, the lower house again passed a slightly amended version of the legislation on March 30.

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