PM pledges sustainability in deficit-cut plan

Parliament

Hungarian Prime Minister Ferenc Gyurcsány pledged that economic changes designed to reduce the budget deficit, the European Union's largest, and secure his country's adoption of the euro would be sustainable. The government plans to cut the budget deficit to near the 3% limit needed for euro adoption by 2008, from a revised target of 8% this year. Gyurcsány is raising taxes, increasing regulated prices and cutting government jobs to narrow the shortfall after five consecutive years of overruns. “We must make sure the emphasis of sustainability prevails, because everything else will be endangered otherwise,'' Gyurcsány told an assembly of his Socialist Party today. “Whatever we do must strengthen and not weaken the financial and economic foundations.'' He urged regional Socialist representatives at today's meeting to push through the budget cuts and planned overhauls in education, healthcare and public administration, even if the party's popularity, and living standards, decline. “Hungary will understand very quickly, that what the political left is doing is not self-serving, but is in the interest of a better country,'' Gyurcsány told the meeting. “We don't want to be the poor relatives in the EU any more. We have to go through this overhaul, even if it's uncomfortable.'' The government plans to cut the budget deficit by Ft 350 billion ($1.6 billion) this year to reach the revised deficit target and a further Ft 1 trillion in each of the next two years. Gyurcsány in a June 28 interview reiterated that he wants to meet euro adoption terms by 2008. The prime minister is ending price subsidies for drugs and natural gas and applying “hard ceilings'' in the budget to avoid more deficit overruns. Ministries will have to set aside reserves to safeguard against overspending and will have to account for their finances quarterly.

ADVERTISEMENT

Reforms to raise productivity would strengthen recovery - OE... Analysis

Reforms to raise productivity would strengthen recovery - OE...

Gov't calls tender for HUF 137 bln in corporate R&D funding Government

Gov't calls tender for HUF 137 bln in corporate R&D funding

Skanska commercial dev unit names new EVP of operations Hung... Appointments

Skanska commercial dev unit names new EVP of operations Hung...

Zsa Zsa Gabor's ashes buried in Budapest City

Zsa Zsa Gabor's ashes buried in Budapest

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.