Lázár: Gov’t to defend against EC charges of improper tendering

Deals

The Hungarian government will call tenders for European Union funding available under Hungary's new operative programs in April, and will avoid a lengthy suit over questions of improper tenders, cabinet chief János Lázár said in Brussels on Thursday.

Lázár said the government would make efforts to defend itself from having to pay fines over EU-financed road construction projects before the end of this year. He said that the European Commission was considering fining Hungary HUF 100 bln-150 bln, charging that the government had restricted free competition when selecting contractors for those projects.

Lázár said that a fine of that magnitude would be difficult to pay from central coffers, but also added that the Commission "seems to accept the Hungarian position to a certain extent". The government had requested a hearing with the Commission on the matter, and though it might not be held before March, a lengthy lawsuit at the European Court could be avoided, he said.

Lázár spoke after talks with Corina Cretu, EU commissioner for development policy, and said that the European Commission had "in fact" approved most of the programs submitted by the Hungarian government. Lázár noted, however, that there were still some open issues concerning rural development, fishing, and a program in connection with the public administration reform.

At the Commission's request, the government sent to Brussels a new public procurement plan last month, Lázár said, adding that the EC had approved the plan "for discussion and implementation". Accordingly, a new public procurement law will be drafted, to "promote a new public procurement practice, make access easier to European funds, and reduce red tape", Lázár said. He said that it was also important to increase transparency of the distribution of community funds, and to "avoid even the suspicion of graft".

The minister also said that Hungary was facing "a great challenge" of drawing an equivalent of HUF 2.1 trillion in community funding before the end of 2015. Between 2007 and last year, Hungary had paid out HUF 6.88 trillion to winning companies, 80% of the total available to the country in that budgetary period, Lázár said. He added that the government would make an action plan for each ministry to draw the remaining amounts. 

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