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EU to review Hungary pension fund measures

The European Union will review the Hungarian government's plans to divert taxpayer contributions from private pension funds in a bid to patch up its budget deficit, EU spokesman Amadeu Altafaj Tardio told wire agency MTI.

"Based on the very preliminary information we have, our impression is that the measures seem to a large extent to be of a temporary nature," said Tardio, spokesman for EU Finance Commissioner Olli Rehn. He said the diversion does not appear to be a sound measure and does not contribute to a sustainable deficit reduction. Earlier this week Hungary's government announced it would hold back taxpayer payments  into private pension funds for 14 months from this November and encourage private pension fund members to return to the state pension scheme.