Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

The cost of freedom and democracy:  Hungary faces reckoning with EU that could cost it billions

The cost of freedom and democracy: Hungary faces reckoning with EU that could cost it billions

After his headline performance at Hungary's Sziget Festival last month, pop star Justin Bieber held a grandiose party for his staff in a luxurious countryside setting — a 19th century castle owned by the son-in-law of the country's prime minister.
The castle, to the critics of Prime Minister Viktor Orban, is emblematic of the corruption, nepotism and largesse of which the populist leader and his government have been accused for years — the kinds of behavior which now threaten to cost Hungary billions in European Union funding.

Standing beside the iron gates of Schossberger Castle this week, an independent Hungarian lawmaker who has made a name for himself as an anti-corruption crusader snapped pictures of the structure and its expansive manicured grounds.

A former member of Orban’s ruling Fidesz party, Akos Hadhazy left the nationalist-populist party in 2013 after becoming aware of what he describes as a clientelistic system of unchecked corruption taking shape in the Central European nation.

“When Fidesz came to power, I saw more and more that a very serious organization was beginning to develop throughout the country, whose main task was to steal as much of the European Union’s money as possible,” Hadhazy told The Associated Press.

Now, Orban is facing a reckoning with the EU, which appears set to impose financial penalties on his government over corruption concerns and alleged rule-of-law violations that could cost Budapest billions and cripple its already ailing economy.

The EU’s executive arm, the European Commission, has for nearly a decade accused Orban of dismantling democratic institutions, taking control of the media and infringing on minority rights. Orban, who has been in office since 2010, denies the accusations.

The longstanding conflict could culminate Sunday when the commission is expected to announce a funding cut for Hungary, one of the 27-nation EU’s largest net beneficiaries, if the country does not change course.

Peter Kreko, director of the Budapest-based think tank Political Capital, said the EU appeared to be hardening its stance against Orban after previous disciplinary measures failed to bring Europe’s longest-serving leader into compliance with its values.

“EU institutions learn slowly, but they learn. More and more people in the Commission and in the European Union know about the negotiation deception tactics of Hungary, as well as about the nature of the Hungarian political regime,” Kreko said.

While it is not clear how much money Hungary stands to lose, funds cut from its 22 billion-euro (dollar) share of the EU’s 2021-27 budget could affect around 70% of funding from some programs, according to an internal July document by Budget Commissioner Johannes Hahn.

Many of the potential cuts are related to public procurements — purchases by the state of goods and services or for the execution of projects using EU funds.

According to Hadhazy, improper processes for awarding of such contracts have allowed Orban’s government to channel large sums of EU money into the businesses of politically connected insiders.

“Huge fortunes were made from such things, and they are essentially the source of this astonishing luxury mansion behind us,” Hadhazy said of the castle in the town of Tura. “The system is about having its tentacles ... in the highest levels of government.”

EU commissioner Hahn’s memo also pointed to irregularities in public procurements in Hungary and to “an increase of the odds of winning of politically connected companies.”

Hadhazy, who has investigated and documented hundreds of cases of alleged corruption, borrowed a car from his mother to visit several places this week where he suspects EU funds were misused.

One was the site of a planned server farm near Budapest where the government said it would store the state’s most important data. Receiving more than $50 million in EU funding, construction of the facility — awarded to a company owned by a childhood friend of Orban who is Hungary’s richest man — began in 2016, and completion was set for the following year.

But when Hadhazy visited the site on Wednesday, only a concrete skeleton stood where the server park was planned — a sign, he said, that the funds may have been misused.

“The whole process is a charade,” Hadhazy said of Hungary’s public procurement process, which ordinarily should involve competition between several bidding companies. “It’s decided at the very beginning who can win, and it’s decided who will do the work at the end.”

He pointed to a case involving Istvan Tiborcz, the owner of the castle in Tura who is married to Orban’s daughter. The European Anti-Fraud Office found serious irregularities in the awarding of funds to a company he owned.

As a result of the office’s investigation, the EU demanded the return of more than 40 million euros (dollars). The sum was ultimately footed by Hungarian taxpayers, not Tiborcz’s company, and an investigation into the case by Hungarian authorities was dropped for lack of evidence of a crime.

Tiborcz was Hungary’s 36th wealthiest person this year, according to an analysis by Forbes Hungary.

Orban’s government recently made conciliatory efforts to unlock nearly 6 billion euros (dollars) in pandemic recovery funds that the EU withheld over corruption concerns, and to head off further cuts to Hungary’s portion of the EU budget.

Earlier this month, the Hungarian government pledged to set up its own anti-corruption agency. It has reportedly prepared additional legislation aimed at increasing transparency in public procurements.

But the European Commission faces pressure from EU lawmakers to fully enforce rules on corruption and rule of law requirements. In a resolution passed Thursday with an overwhelming majority, the European Parliament said the Hungarian government had become “a hybrid regime of electoral autocracy” that could no longer be considered a democracy.

Hungary’s Ministry of Justice did not respond to a request for comment. Speaking in Serbia on Friday, Orban dismissed the resolution as a “joke” and maintained that his government’s conservative credentials were the reason for the EU’s tough stance.

Kreko, the analyst, said it was doubtful Orban’s government was serious about changing its ways.

“I would say that the engine of the Orban regime is nepotistic corruption,” he said. “So I think we can be rather skeptical about that how much the government really wants to step up against corruption, which is part of the nature of the regime.”

In 2021, Hungary’s government opted out of joining the European Public Prosecutors Office — an independent EU body tasked with combating crimes affecting the financial interests of the bloc. It argued that joining would amount to a loss of national sovereignty.

But Hadhazy said that unless Orban’s government agrees to join the office, there will be no real guarantee that graft reforms will be able to achieve any meaningful results.

“I say that if the EU gives Hungary one eurocent without us having joined the EU prosecutor’s office, then the EU really is as stupid as Orban says it is,” he said.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
German Chancellor Friedrich Merz: “The Current Welfare State Can No Longer Be Financed”
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
Wizz Air passengers screamed as storm-battered flight diverts to Bologna
European postal services halt U.S. deliveries after Trump imposes new tariffs
Urban explorer finds abandoned luxury restaurant left to decay
Fidesz leader labels Péter Magyar a ‘bluffer’ amid escalating political spat
French rope park operator arrested for denying entry to Israeli children
Újpest thrashes Zalaegerszeg 4-1 to secure first win in five matches
Profit-margin cap costs retailers 13 billion forints a month, warns trade group
Curiosity rover finds coral-like rock on Mars hinting at watery past
U.S. green policy rollback drives investors to Europe’s sustainable finance market
Special funerals rise in Hungary: boat, aerial and forest burials gain popularity
Hungary’s Kiskunság region turning into semi-desert after extreme drought
Kopasz Bálint wins world kayak 1000 m title in Milan, making him triple world champion
Budapest’s Keleti railway station to close for four weeks for track overhaul
Balaton could be unfit for swimming by 2035 and dry by 2050, scientists warn
Leaked guidelines show Meta’s AI allowed flirty and racist interactions with children
Filming of ‘Emily in Paris’ halted after assistant director dies on set
Filipino guest workers sue after Hungary moves to deport them for pregnancy
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
A monster hit and a billion-dollar toy empire
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
Canada: Nurse Suspended and Fined 93 Thousand Dollars After Stating the World’s Most Well-Known Fact Since the Creation of Adam and Eve, That There Are Only Two Genders
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
U.S. Treasury Secretary Whitney Bessent Backs Stablecoins to Boost Treasury Demand
Spain to Declare Disaster Zones After Massive Wildfires
Three-Minute Battery Swap Touted as Future of EVs
Beijing Military Parade to Showcase Weapons Advances
×