The European Commission recommended, Wednesday, November 30, to freeze 7.5 billion euros of cohesion funds and 5.8 billion of the recovery plan intended for Hungary. The body called for these funds to be released only when justice and anti-corruption reforms have been properly carried out. Member States have until December 19 to vote by qualified majority.
A procedure of “conditionality”, designed to protect the European budget from attacks on the rule of law, was launched against Hungary in April. This decision, a first for the EU, was taken in particular because “systematic irregularities in public procurement”as well as “failures” in the area of legal proceedings and the fight against corruption.
Insufficient reforms
The prospect of being deprived of funds prompted Budapest to initiate 17 measures to respond to Brussels’ concerns. For example, the executive has set up ae “independent authority” intended to better control the use of EU funds, suspected of enriching relatives of Viktor Orban. However, the Commission considers that these reforms had not been carried out satisfactorily by the November 19 deadline. The European executive had set this deadline in September to offer Hungary a chance to escape the freezing of 7.5 billion euros (around 20% of the European funds it must receive over 2021-2027).
The European executive has also decided to validate Hungary’s post-Covid recovery plan (5.8 billion euros) but by attaching 27 conditions, which include the 17 anti-corruption measures, as well as reforms to improve the independence of the judiciary. “No disbursement of funds will take place until these essential conditions are properly met”said Commission Executive Vice-President Valdis Dombrovskis on Wednesday.
