EU to free up suspended funds (minus penalty)


As expected, European Union authorities have decided to restart development funding to Hungary, though the country will see a €230 million to €250 million penalty applied due to improprieties in reportage of fund use. 

EU Commissioner for Regional Policy Johannes Hahn made the announcement yesterday after meeting with Prime Minister’s Office State Secretary János Lázár. Some €2 billion remains unpaid to Hungary.

In reporting to media on the “results-based and constructive” meeting with Lázár, Hahn stated, “I welcome the complete draft of the partnership agreement to plan investments for 2014-20. We will work together to produce a final version but I have congratulated the minister, as Hungary was one of the first member states to submit a ‘mature’ complete draft.”

Hahn added that “We are working closely with the Hungarian authorities to minimize the risk” and that the meeting “also gave us an opportunity to resolve some other pressing issues. I am pleased that Hungary accepts the financial corrections proposed by my services. This is in view of concerns over the past system of tendering contracts…”

In October 2012, the EU ceased funding – effective as of August 1, 2013 – to Hungary due to irregularities in reportage. Also cited as a reason for concern was the local insistence that any construction site inspections be carried out only by Hungarian Chamber of Engineers members.


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