Can Péter Magyar convince the EU Commission to release Hungary’s funds?
EU money could soon flow again to Hungary.
The new prime minister, Péter Magyar, hopes to seal a deal this week to unfreeze €10bn in EU funding.
To achieve that, Magyar needs to present reforms that are acceptable to the EU.
What would these reforms mean for Hungarians?
Hi, I’m Léa, and this is Briefed, your daily European podcast.
A group of more than 20 officials from the European Commission arrived in Budapest on Monday for a full week of negotiations. The aim: to find solutions that would unblock 10 billion euros in EU funding.
Let’s recap where things stand.
Over the years Viktor Orbán was in power, Brussels blocked several streams of funding. Because Orbán repeatedly violated European rules, mechanisms were put in place to ensure that countries receiving EU money respect the EU’s fundamental principles.
As a result, some cohesion funds were frozen, as well as Covid recovery funds.
The previous Hungarian government did manage to unfreeze a small portion of the money, but the country is still waiting for a total of €17bn.
Before becoming prime minister, Péter Magyar promised to unlock all of these funds.
For some of the money, action needs to happen quickly.
As far as the Covid recovery funds are concerned, Hungary has only until 31 August this year to implement the required reforms if it wants to receive the money at all.
So, what does the Commission expect?
The European Commission has prepared a list of 27 so-called “super milestones” that Hungary must fully implement before it can request payments.
What are they about?
Most of them relate to rule-of-law issues.
For example, the country must establish new independent bodies and authorities to fight corruption.
It also needs to introduce stricter rules on conflicts of interest and reinforce judicial independence. That includes increasing the powers of the independent National Judicial Council.
The reforms also aim to change the current system, which allows political influence over the Supreme Court.
But the milestones are not only about rule-of-law concerns. They also relate to Hungary’s economic situation.
The EU wants assurances that Hungary’s fiscal situation is sustainable. That is why Brussels is calling for reforms to ensure the long-term sustainability of the pension system.
Now, will Hungary agree to everything in order to obtain the funds?
On rule-of-law matters, at least, the new government appears to be broadly aligned with the European Commission.
Hungary’s foreign minister, Anita Orbán, insisted in an interview with Politico that the super milestones closely match the government’s own plans.
As proof, the government has already introduced an amendment to the Constitution, which is currently being examined, as Hungarian media outlet 444 — our partner within the Sphera network — reports.
If adopted, the amendment would end a system long criticised by the EU: the management of universities by private foundations.
This matters greatly for young Hungarians because it could restore full access to the Erasmus+ programme.
The European Commission restricted Erasmus+ funding for students at certain Hungarian universities after private foundations took control of them in 2022.
Now, the economic reforms appear more difficult to implement.
Take pensions, for example: Magyar campaigned on raising minimum and below-average pensions. Brussels, on the other hand, is essentially asking Hungary to reduce spending.
The European Commission also wants Budapest to remove certain taxes, including windfall taxes. But the Magyar government has already described this as a red line.
So, what should Hungarians expect?
Magyar’s government believes that some of the required reforms cannot realistically be implemented before the end of the summer.
Still, the new prime minister has shown goodwill. And the positive relationship he has built with the president of the European Commission could prove useful. According to Euronews, the commission may simplify some milestones to make them easier to achieve.
According to several sources, Péter Magyar is also planning to visit Brussels before the end of the week to announce an agreement in principle to unfreeze the funds.
Barely two months after his election, that would represent a major political victory — and perhaps the beginning of a new era for Hungary within the EU.
