Are you sure?

Hungarian ministries are not publishing their contracts according to law

The government is not taking its predecessor's signature transparency regulation too seriously: the Prime Minister's Office, for example, has not updated its data for more than five months.

Although Hungary’s glass-pocket law is considered progressive even in a European comparison, its implementation still holds much room for improvement. The law, which came into effect in 2003, gives detailed rules for state institutions and state-owned companies on making public their contracts and payouts above a certain level, it seems to be far too little to make public money management more transparent. Several ministries and a huge number of state-owned companies neglect the law and “forget” to publish data of public interest.

Chief among them is the Prime Minister's Office, which has not even updated the data on website since November 2010. Neither has the Ministry of Rural Development. On the positive end of the spectrum is the website of the Ministry of Public Administration and Justice (KIM) and of the the National Development Ministry (NFM), which are up-to-date and organized.

State electricity wholesaler MVM is losing trial after trial for not publishing data of public interest and so the company is regularly forced by the court to comply – case by case. Still, this has not changed its practice: it has not updated the list of its contracts since April, 2010. The firm's spokesperson told the BBJ, however, that they are planning to do so.

There are other signs that making their pockets transparent has simply not become routine at government offices. For example, we asked the Ministry of National Economy, which has not updated its list since December, 2010 why it has not done so. After three telephone conversations with the press department, we were redirected to the ministry’s website editor to ask him why he had not uploaded the required data. (We were unable to reach the editor.)

One-way glass

“The main problem is that the publication of the data is uncontrollable,” Tivadar Hüttl, head of the Data Protection and Freedom of Information Program at civil liberties group TASZ, told the BBJ. Indeed, it is difficult to find out even if an institute publishes every contract on its website or makes a subjective selection and publishes only those do not inconvenience for the organization. As a result, the law completely fails in being proactive, meaning that the pressure of publicity does not make the financial management of the given institutions more transparent.

According to a recent study by Transparency International, 65%–75% of Hungarian public procurement tenders are soaked in corruption, making purchases 25% more expensive. This is a huge burden on state coffers every year, and is also a threat to investment.

Basis for legal action

Well, at least the glass-pocket law is at least good as a reference when civilians – mostly journalists – initiate legal action against state institutions for keeping data of public interest under wraps.

Most recently, daily tabloid Blikk brought a legal suit against the Office of the President (KEH) in order to force it to make public the salary of one of its employees, who happens to be the nephew of Fidesz MP István Balsai. While KEH refused to answer for a month, two days after Blikk launched the suit the Office came around.

Blikk’s affair with the KEH is not unprecedented. Several similar stories stand to illustrate that the glass-pocket law is handy in enforcing publicity subsequently.

No punishment

However, being forced by a court to make public certain data is the strictest measure that can be taken against those who neglect the law. Any other sanctions can come only if it is proven that somebody distorted or intentionally hid data. "Such things are very hard to prove. Almost impossible,"said Ádám Földes, the head of Transparency International Hungary, explaining why there has not been any criminal action on this basis so far.

While building strict sanctions into the glass-pocket law might sound a logical solution at first, TASZ’s Hüttl would not go in that direction. “If something can be solved outside the framework of the criminal code, than it should be,” the civil rights expert said.

Business, secret

From a business point of view, state-owned companies affected by the glass-pocket law might often omit publishing certain data for fear of revealing their business secrets. “If we think they act bona fide, this could be the reason. Otherwise, we cannot think of anything else but the aim to support corruption, which allows many millions of forints to be pumped out from the state budget through intransparent contracts,” Hüttl said.

Companies might be motivated by seeing good examples. For instance, putting the transparency of financial management in the focus of a company’s communication would suggest that the given business works more predictably than those keeping their data in the shadows, and so the transparent company would become more appealing to both investors and clients.

Also, increasing civil awareness and the implementation of codes of ethics would also be essential. “Employees of state-owned companies often do not even know whom to inform if they see infringements of the law,“ Transparency’s Földes said. In England, people had five years of debates and open conferences to prepare for the implementation of the law on the freedom of information. “Hungarians are also in need of something similar,” Hüttl pointed out. Especially since people here, due to the previous regime, still have the reflex to suppress data.

However, a change in approach and a rise in civil awareness take time and this is what the Hungarian economy lacks in terms of beating corruption and beefing up its economic performance.