On Thursday 16 January, the European Commission approved Hungary’s medium-term budget plan, said Hungary’s State Secretary for Public Relations, Zoltan Kovacs, on the X social network. After assessment, the plan was deemed to “comply with the provisions of the Regulation” on the effective coordination of economic policies and multilateral budgetary surveillance, the European Commission confirmed to Agence Europe. The Commission therefore “recommended that the EU Council approve the plan”.
Aimed at complying with EU fiscal rules, the plan is part of the EU’s Stability Pact. The Hungarian government is committed to aligning its balanced budget with economic growth.
Hungary’s annual deficit of 4.9% of GDP last year is set to fall to 2.9% in 2026, below the EU’s 3% threshold. Zoltan Kovacs specified that an intermediate result of a 3.7% GDP deficit would be targeted in 2025. Because of its high budget deficit, Hungary remains subject to an “excessive deficit procedure”.
“Intensive consultations” have been taking place between the European Commission and Hungary since Hungary submitted its plan on November 4, in order to meet the requirements of the EU’s new budgetary governance framework. The plan as initially submitted “did not reflect the most recent data and did not guarantee compliance with all the requirements of the regulation”, the Commission clarified.
The plans define the Member State’s budgetary trajectory as well as public investment and priority reforms for four or five years.
Germany, Belgium, Austria, Romania (end of January 2025) and Lithuania (end of April 2025) had been granted an extension to submit their plans (see EUROPE 13495/28).
The European Commission presented socio-economic policy recommendations in December (see EUROPE 13548/18) and budgetary policy recommendations at the end of November (see EUROPE 13532/11) to launch the 2025 iteration of the ‘European Semester’ process. A “slightly restrictive” fiscal stance is planned for the Euro area in 2025, at 0.25% of GDP, and again in 2026, following a restrictive stance in 2024 at 0.5% of GDP.
Macrobudget plans are available at: https://aeur.eu/f/djs (Original version in French by Florent Servia)