István Tarlós, the new mayor of Budapest, told a news conference on Wednesday that the city would not be able to plug its revenue gap and service its debts without the central government stepping in.
Tarlós, who has asked the state audit office to examine the city's finances, said he would meet Prime Minister Viktor Orbán next week to discuss the situation. He said it was not only a matter of financing but whether the state should take over certain responsibilities from the municipality.
“The situation is exceptionally worrying; day-to-day operations are not endangered but the 2011 budget is,” he said.
Tarlós said the biggest source of “fear” concerned debt-ridden municipal transport company BKV, whose debts are reckoned to exceed an earlier estimate of HUF 400 billion. He said he would negotiate with Orbán on whether BKV's operations might be combined with those of the state railway company MÁV and long-distance bus operator Volán, with the state and the city council taking joint responsibility. Streamlining at the company is also on the cards, he said.
“An examination of why there are as many people in the office as bus drivers will be made,” he said.
A separate investigation into the fourth metro line will also be undertaken, Tarlós said, adding that he did not want to halt the investment. But one question mark hanging over the project is whether it will be possible to complete it since today it is not known whether the city has enough funds available, he said. (MTI-Econews)