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Hungary gov't to loosen rules on supplementary budget, losses at state-owned companies

MPs of governing Fidesz have tabled amendments to Hungary's General Government Act which would make changes to the threshold requiring a supplementary budget, budget planning deadlines effective for election years and the accounting rules for state-owned companies.

The amendments are effectively a return to earlier legislation.

One of the amendments would require a budget amendment if expenditures deviate by 2.5% or more from the target. A supplementary budget would be required if expenditures deviate 5% or more from the target.

The rules are looser than the current rules, under which a supplementary budget must be prepared if the primary balance deteriorates from the target by 0.2% of GDP or more.

Under the proposed rules, the government would be obliged to submit a supplementary budget only if the budget deficit exceeds the HUF 836 billion annual target by around HUF 435 billion in 2010. Under the current rules, a projected drop of around HUF 55 billion in the primary surplus, targeted for the central government at HUF 231 billion, would require a supplementary budget.

Another proposed amendment would move the deadline to submit the main outline of the following year's budget to Parliament to June 30 in election years, instead of April 15, and it would allow any newly elected government to submit the budget bill by October 15, instead of August 31, the deadline in non-election years.

The deadline for submitting the additional tables and explanations to the budget bill would be moved from October 15 to November 15 in election years.

The third proposed amendment would eliminate the obligation to account the eventual losses of state-owned companies as part of the general government deficit. (MTI-Econews)