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Mayor leaves govt talks on BKV with "cautious optimism"

Budapest mayor István Tarlós said there was reason for "cautious optimism" regarding the situation of the capital's troubled public transport company BKV after a meeting with government officials on Friday.

Tarlós said the government's conditions were realistic and could be fulfilled. He added that the sides were able to find a direction in which to move with regard to the management of BKV's debt.

He said a decision would be taken on the simplest and fastest way to manage the debt at later talks.

State secretary of the Prime Minister's Office Mihály Varga said after the talks that the central government could not take over ownership rights of BKV from the capital, adding that it was important for the city to manage and solve its own transport problems.

He said that keeping the BKV operating was in the mutual interest of the central government and the local council.

"We are interested -- and I think the capital is also interested -- in moving past the era of one-off, extraordinary subsidies and top-ups, and in following up with a financing period in the BKV's existence that establishes the systemic operation of the company," he said.

The central government contributed HUF 140 billion to the capital to support the continued operation of BKV in 2010 and 2011, he noted.

Varga said financing BKV's debt was among the most pressing problems at the moment. He added that measures necessary to manage the company's HUF 40 billion in debt must be taken without making the company's operation impossible.

He said the company's operation had to be restructured in a kind of long-term framework that did not require extraordinary government measures.

Varga said the government wanted to outline a "reassuring solution" for public transport at talks with the International Monetary Fund and the European Union on a precautionary financial assistance package, one that "will not present any obstacle" to an agreement. 

Minister without portfolio in charge of talks with the IMF and EU Tamás Fellegi and state secretary for the general government György Naszvadi also participated a the talks.