MEPs against funding Hungary

Strasbourg 24.11.2022 Commission and Council should resist pressure from Hungary and go ahead with adopting the proposed rule of law conditionality measures to suspend EU cohesion funds.

In a resolution passed on Thursday by 416 votes in favour, 124 against and 33 abstentions, MEPs say that the 17 remedial measures negotiated by the Commission and Hungary are “not sufficient to address the existing systemic risk to the EU’s financial interests”, even if implemented fully.

They call on EU member states to adopt the proposed measures under the Conditionality Regulation in order to protect the EU budget against breaches of the principles of the rule of law in Hungary, and to lift them only after the Hungarian remedial measures have had a sustainable effect. “If these measures are reversed in the future, the Union should proceed to financial correction”, they add.

Regarding Hungary’s recovery and resilience plan (RRF), they deplore that, because of the government’s actions, recovery funds have not yet reached the Hungarian people. According to the EP, the risk of misuse of EU funds in Hungary remains and the Commission should not approve Hungary’s RRF plan until the country has fully complied with all recommendations in the field of the rule of law and all relevant judgments of the EU Court and the Court of Human Rights.

Pressure from Hungary and final beneficiaries

MEPs call on the Commission and Council not to give in to the pressure Hungary is exerting on them by blocking crucial EU decisions, such as €18 billion in macro-financial aid to Ukraine and the global minimum corporate tax rate deal. This “abuse” of the rule on voting by unanimity should “not have any impact” on the decisions regarding the Hungarian recovery plan and the application of the rule of law conditionality legislation, the text says.

Parliament stresses that final beneficiaries of EU funds should not be deprived of support due to their government’s lack of cooperation, and call on the Commission to find ways to distribute EU funds via local governments and NGOs.

Finally, MEPs complain that the proposal to trigger the Conditionality Regulation against Hungary has been long overdue and does not go far enough -“after a long delay and with too limited a scope”. Parliament urges the Commission to take action also concerning other breaches of the rule of law, particularly those relating to the independence of the judiciary.
On 18 September 2022, the Commission proposed to freeze 7.5 billion euro in EU funds for Hungary, citing corruption and public procurement concerns, after having triggered the rule of law conditionality mechanism against Hungary in April.

After negotiations with the Commission, Hungary has presented 17 remedial measures, such as creating an anti-corruption task force and changes to its public procurement rules, to address the concerns.

The Council has until 19 December to take a decision, by qualified majority, based on a Commission proposal.

Prime Minister Viktor Orbán’s government has said that it was willing to pay its share of support for Ukraine but would rather pay it bilaterally than through the EU’s joint borrowing.

“The government continues to be committed to take part in financial support to war-gripped Ukraine,” the decree reads.

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