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Bajnai: 2nd National Development Plan to support employment, growth and reforms

The more than Ft 8.000 billion available under Hungary's second National Development Plan in the next seven years should be used to encourage employment and economic growth, government commissioner in charge of development policy Gordon Bajnai told a conference on Wednesday.

The other main principle of the development policy is to support reforms, such as the reforms of the health and education systems and of public administration, he said. Hungary will have Ft 6,875 billion available in the branch operative programs and another Ft 1,300 billion in regional development funding between 2007 and 2013, Bajnai said. 85% of the funding will come from the European Union and 15% from the Hungarian state budget. Private capital and local government funding could further contribute to the funding available.

Among the programs, Ft 1,.500 billion -1,600 billion is targeted to be spent on human resources, Ft 1,053 billion on environmental and energy-related programs, Ft 140 billion on state reform, Ft 1,620 billion on regional programs, Ft 674 billion on economic development and Ft 1,721 billion has been earmarked for transport (road and railways) and logistics developments, he said. A main principle of the new plan is that no additional funds should be spent on maintaining a bad structure, noting that the funds available must be used to support major reforms. In some areas applications will be accepted as soon as January but the genuine start will be only next spring, Bajnai said.

Hungary has been using 46% of the EU funding currently available, a ratio exceeded by Slovenia, and in line with that of Estonia, Bajnai noted. He admitted, however, that the institutional system of tendering was slow and bureaucratic, with applications processed in four-to-five months. "We will cut the number of institutions and the fact that applications could be submitted through the Internet in the future will also accelerate the process", Bajnai said.

The government will submit branch and regional operative programs together to Brussels in the middle of December, Prime Minister Ferenc Gyurcsány said on Monday. Gyurcsány said temporary action plans would be drawn up by the National Development Council in order to allow applications for funding available during the period to be submitted, before the programs are actually approved by Brussels. He added that the European Commission would take 3-4 months to approve the operative programs. (Mti-Eco)