The European Commissioner for Budget and Administration, Johannes Hahn, and MEPs from the Budgets (BUDG) and Budgetary Control (CONT) Committees discussed on Wednesday 24 May the implementation of the Rule of Law Regulation, Hungary’s progress in unblocking frozen EU funds and the visit of several MEPs to Hungary in mid-May (see EUROPE 13184/25).
“There has not been much progress”, Johannes Hahn announced at the outset, since the European Council suspended 55% of the commitments for three operational programmes of the cohesion policy (€6.3 billion in total for 2021-2027) (see EUROPE 13083/27, 13082/2).
In addition, the Commission may no longer enter into legal commitments with public interest trusts, or any entity managed by such trusts, for programmes implemented under direct and indirect management.
Before the decision was adopted, the Commissioner stressed that he had been in contact with the Hungarian authorities to resolve problems that may threaten EU funds. “Hungary has since submitted a series of amendments to its legislation. The Commission has examined them and made its assessment, but we have not reached the (desired) objective”.
Regarding conflicts of interest in public interest trusts, “our main problem is Erasmus +, but also Horizon Europe. (...) There is a risk that in the next semester Hungarian students will not be able to leave, at least those who come from these universities which are run by these public law bodies. We have suggested several solutions to resolve this conflict of interest situation and so far we have not received any concrete proposals”. The deadline for Hungary was set by the Commission for mid-July.
Nevertheless, he said that the discussion on improving the independence of judges, which would be one of the conditions for unlocking Cohesion Funds, was moving forward (see EUROPE 13175/22).
Several MEPs were keen to express that, despite the fact that the Commission communicates some progress made by Hungary, the findings of the MEPs who visited the country are “very worrying” (see EUROPE 13184/25).
“The focus now is on integrity reforms and the fight against corruption (...), but the reality on the ground is that there is pressure, harassment of international companies, regions, mayors in opposition (...), but also independent media”, said Lara Wolters (S&D, Dutch).
On the conditionality mechanism, Jan Olbrycht (EPP, Polish) stressed the need for transparency and the possibility to quantify progress. “This is a new instrument that calls for very clear rules and elements of transparency. We can really learn from this Hungarian case”.
Mr Hahn assured MEPs that the European Commission’s aim was to find a constructive solution. “Some people think that we are not looking for solutions or that the Hungarian partners are not looking for solutions, but I can say clearly that we want a solution, an improvement of the situation for the Hungarian citizens”.
He also assured that there would be no “rebates” on the conditions of the funds. “Ultimately, we are aiming for a solution and if the 27 milestones are not met (see EUROPE 13184/25), there will be no rebate. It is the 27 milestones or nothing”.
Secondly, he said that the Hungarian government had not yet sent a ‘notification’ that would allow an assessment to take place and that the Council could then make its recommendations.
“The ball is clearly in the Hungarians’ court for the moment”, he concluded.
Finally, he assured that the Commission was closely monitoring the situation in other Member States and would soon publish a report on the development of the Rule of Law. (Original version in French by Pauline Denys)