Gergely Gulyas – Photo: MTI

Talks with EU on budget, recovery fund ongoing

Talks between Hungary and the European Union are "going well" on the EU's budget for the 2021-2027 financial cycle but hit the buffers regarding the pandemic recovery fund, the prime minister's chief of staff told parliament's EU affairs committee on Tuesday.

In his annual report to parliament’s European affairs committee, Gergely Gulyas said the EC had “blown up an informal agreement” after Hungary’s parliament passed amendments to its child protection law earlier this year and restarted the procedure on the country’s access to the EU’s Recovery and Resilience Facility. Hungary “gave the only right response to the main problem, the LGBTQ issue,” by proposing a referendum on the subject.

Family and education policy are in the hands of the member states, and “Hungary finds it unacceptable that the EC should express as much as an opinion on the matter,” he said.

The EC has also “dragged other issues, such as transparency and public procurements, kicking and screaming into the debate,” he said. Hungary is ready to improve in areas where the requests are “reasonable”, he said.

The government hopes to seal an agreement on the recovery fund “sooner or later”, he said.

Regarding the EU’s budget for the 2021-2027 financial cycle, Gulyas said there was “no reason to believe the talks wouldn’t progress according to procedure.” The previous budget agreement took 18 months to conclude, and this year’s talks are only in their 11th month, he said.

Hungary has taken great strides forward in certain sectors, he said. The EU will therefore allocate more funding to areas such as economic development and information technology, and cut direct job subsidies, he said. In line with the green transition, more money will be channelled into rail and less into road development, he added.

The Hungarian government is pre-financing the tenders, and so the calls for bids have already gone out, he said. This helps to keep the payment system effecive despite “bad-faith and often politically motivated administrative discussions” in Brussels, he said.

Hungary is slated to receive “funding at the same scale” as it did in the 2014-2021 cycle, Gulyas said. “As 70 cents of every euro later returns to western Europe, this is a win-win situation. We owe no gratitude or thanks to the European Union,” he said.

Commenting on current challenges facing the EU, Gulyas said the situation was “graver” than before as the bloc was now internally divided. “The self-styled liberal Western European ideology is the most discriminative since the second world war, and allows no dissent,” he said. The European Parliament, along with other institutions, “thinks it should force its views on central European member states, and uses rule of law conditionality as cover for that,” he said. “We must state our disagreement; we do not want to ascent to those with diametrically opposed views to ours,” he said.

Responding to a question on Russia’s Sputnik V vaccine, Gulyas said the EU’s decision to “introduce trade sanctions on vaccines in a crisis means they are playing with people’s lives.” Sputnik is one of the most effective vaccines, he said, but the EU and the European Medicines Agency refuse to approve it for political reasons, he added.

On the issue of Hungary and the euro zone, Gulyas said it would be worth considering joing the single currency when the country’s level economic development reaches 90 percent of the EU average. Currently, it stands around 76-78 percent, he said.

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