Orban: Spending Freeze Precautionary Measure
Budapest, July 18 (MTI) – The 110 billion forint spending freeze announced on Thursday is a precautionary measure, the prime minister said in a radio interview.
Speaking to public Kossuth Radio, Vikor Orban said that the economy minister, Mihaly Varga, had made the proposal to freeze spending in order to ensure this year’s budget deficit target of 2.9 percent of economic output.
He said that whereas the deficit target would be kept, the shortfall would be on the margins of the 3 percent of GDP required by European Union rules, and in such cases it is correct to make it “clear to the country and the world” that the Hungarian government is doing everything possible to stick to the target.
He said the significance of this is that Hungary must continually raise money on the market in order to service its expiring debt, and it is not neither here nor there what conditions are attached. The interest rate influences how stable creditors regard the budget, he added.
“I think there’s no need for the freeze but these are emergency and precautionary measures,” he said.
Asked about whether it was painful that the government had been forced to half construction of soccer stadiums, Orban said that luckily these construction projects would go ahead. He said the freeze contained several items which would not have been paid for in any case this year, including several sports investments, due to related delays. These will slip over to next year.
The prime minister also spoke in the topic of university chancellors who are to be put in charge of institutions’ finances, many of whom had by now been nominated and were, he said, without exception recognised economic professionals. He said Hungary’s universities were in very bad shape financially. Several have already undergone screening and now all institutions will have to be properly examined. Many are indebted and funding in several respects is not a simple matter, he said, adding that the financial conditions under which universities were operating were unsustainable over the longer term.
On the subject of health care, Orban said the government wanted to avoid “extra services” having to be paid for. Some areas such as plastic surgery must be considered in this respect, he said. The network of general practices is not strong enough, and if the problems of hospitals are to be solved then family doctors working amid straitened circumstances must be strengthened, he said.
Speaking about the programme of the new president of the European Commission, Jean-Claude Juncker, Orban said he and Juncker agreed on some of the programme’s ten points and they would hold dialogue on the others. Among the latter, he mentioned immigration, which, he said, in the EU they think is a “good thing”. The prime minister said that to the contrary, it is a “bad thing”. People who leave their home countries due to economic hardships must be helped to stay at home, whereas the genuine politically persecuted should be welcomed, he added. Orban said Europe needed a labour force, and Europe should mobilise its own unemployed rather than spending money on immigrants it should fund education programmes, including for around ten million Roma in Europe.
“If we are speaking about labour reserves, than we should be thinking about them and not, say, refugees from Africa,” he said.
He said he had agreed with Junker that before the new European Commission starts its work, they would have a meeting to appraise the disputes between the EU and Hungary. Among them are the land law, foreign-currency loans, cheap energy, cuts to utility fees, taxes on multinationals and banks, Orban added.
The prime minister noted that after Juncker had been appointed, he had phoned to congratulate him. Orban said he had a good personal relationship with Juncker and this was separate from how they both saw Europe’s future.
Photo: MTI – Szilard Koszticsak