EPP Group considers that clear signs of rule of law distortions persist in Hungary

The Budgetary Control Committee of the European Parliament has completed its fact-finding mission to Hungary. MEPs looked into the protection of the EU budget and the rule of law-related budget conditionality mechanism.

For the EPP Group, represented by committee Chair, Monika Hohlmeier MEP, and the Group Spokesman on Budgetary Control, Petri Sarvamaa MEP, concerns remain unchanged.

“Our mission leaves us with concerns: companies presented us with concrete proof during the mission that discriminatory measures against non-Hungarian businesses continue to exist. Moreover, local and regional authorities raised concerns about their insufficient involvement in the design of the national recovery and resilience plan. Our questions to the state audit authority regarding errors, the number of fraud cases, and cases sent to prosecution remain unanswered", said Hohlmeier.

The EPP Group members didn’t witness convincing progress on the remedial procedures in public procurement.

“We were alerted by civil society, the media, the business community and local authorities about concentrations of public procurement awards in the hands of companies and municipalities linked to the government. Arbitrary measures by those in power include intimidating actions, such as visits by the secret police at companies’ offices or extremely frequent audits, that are being used by the Prime Minister’s close circle with the aim of bringing certain sectors of Hungarian industry under Hungarian ownership”, added Sarvamaa.

The committee members witnessed clear signs of breaches of the rule of law. “Hungarian and non-Hungarian companies should have the same rights and obligations to conduct business and must rely on fair and predictable governance by the Hungarian Government. We stressed that the proper implementation of competition and public procurement rules are key for the frozen cohesion funds as well as the RRF funds to be unblocked”, said Sarvamaa.

Also, the continued use of government decrees can be problematic. “We were astonished by the repeated modifications of the 2022 Budget through the use of government decrees. This completely circumvents the normal budgetary procedure and the role of the Parliament, thus casting serious doubt on the sound financial management of the budget”, concluded Sarvamaa.