Hungarian opposition demands end to "corrupt" state land sales

By bne IntelliNews March 29, 2016

The small Hungarian opposition party Egyutt organised a demonstration ahead of an auction for state land on March 29. The party claims the state land sales programme, launched late last year, is being used to open access to state loans and land to those close to the ruling Fidesz party. 

The government launched the privatisation programme in November, with stated aim of giving local farmers the opportunity to buy land. However, the scheme has been widely criticized, with government opponents claiming as much as 40,000 hectares have been sold to people close to Fidesz. The opposition Socialist Party has labelled the programme “legalized theft” and proposed a referendum aimed at halting the programme.

The government auctioned 61% of the 197,000 hectares it made available put up for sale during the first tranche of the scheme, which  concluded at the end of 2015, generating revenue of HUF171bn (€543.9mn). However, no aggregated data base of the auction results is yet available.

Small opposition party LMP said in January that it has calculated that small- and medium-sized famers ended up with around 20% of the land sold. The majority acquired less than 5 hectares each, the party claims. On the other hand, Fidesz politicians and connections purchased some 30% of the land sold, LMP claims, generally in lots exceeding 100 hectares.

A further 30% of the land purchases were made by former directors of agricultural cooperatives and concerns, LMP claims. The remaining 20% was split between foreign buyers and "speculators," the party says.

The family of Lorinc Meszaros, mayor of the Prime Minister Viktor Orban’s hometown purchased 1,391 hectares under the first tranche auctions. The family of Orban’s son-in-law, Istvan Tiborcz, acquired 299 hectares, according to the minutes of the auctions available on the National Ground Management Organization’s website. Although each farmer can only buy 300 hectares of land in total, there is no restriction on relatives or business partners buying also and then uniting them under one operation.

The Hungarian Development Bank offers preferential credit to farmers buying land under the programme. Thus far, it has provided HUF120bn, according to Janos Lazar, head of the Prime Minister’s Office on January 14. Eligible for substantial European Union subsidies under the bloc’s common agricultural policy, the parcels could also bring considerable extra value if they are reclassified as development land, writes Magyar Nemzet.

The government announced a second tranche of sales the same day. In auctions held on March 1-15, Tiborcz and his family paid HUF217mn for 193 hectares while Lorinc Meszaros picked up 77.7 hectares for HUF49mn. He bought an additional 35 hectares for HUF44.4mn on March 29.

The auction that day attracted more media attention than usual as it was selling a farm in Fejer county, West Hungary, in the immediate vicinity of a 13-hectare land that allegedly belongs to Orban himself. Officially owned by the PM’s father, and rented by Meszaros, the PM’s dog officially resides at the farm, local media reports. The territory has not been disclosed in the PM’s wealth declaration. Egyutt's Juhasz Peter called on authorities on March 7 to open an investigation into the enrichment of the Orban family.


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