By Justin Spike – !!444!!! InsightHungary!!! (*)
As millions of Hungarians struggle with the financial fallout of the coronavirus pandemic and many workers, especially in the tourism and hospitality sectors, complain of little or no help from the government, generous state investments have been made into the government’s favored businesses and industries: a chain of hotels owned by Hungary’s richest man, L?rinc Mészáros, received HUF 279 million (€784,000) in pandemic compensation from the state this month, after receiving HUF 17 billion (€48 million) in state aid last year for development of the business. (Mészáros is a personal childhood friend of Prime Minister Viktor Orbán, and is thought by critics to hold assets of the prime minister.)
More than HUF 140 billion (€393 million) in public money has also been invested in Hungary’s rapidly expanding collection of sports stadiums and sports clubs since the beginning of the pandemic, while religious organizations received HUF 103 billion (€289 million) in state aid. Meanwhile, the public healthcare system was the beneficiary of HUF 50.7 billion (€142 million) earmarked from the public budget during the worst public health crisis in more than a century.
On Monday, at an extraordinary Parliamentary session called by the opposition parties, MPs sharply criticized the government’s handling of the coronavirus pandemic and accused it of using the crisis to enrich Fidesz-tied business interests. Opposition MP Tímea Szabó claimed that the government had stolen 76% of the funds earmarked for protecting the economy during the pandemic. (Fidesz-KDNP MPs boycotted the session.)
“No would should have any doubts about why this is happening,” LMP representative Antal Csárdi said. “The bled-out tourism sector will be filled up with government-tied businesses, and the entire sector will be bought up with public money.”
Last week, frustrations among restaurateurs appeared to reach a peak as many business owners and workers in the sector publicly complained that their businesses would go bankrupt if they were not allowed to re-open or did not receive badly-needed financial assistance from the government. Of the roughly HUF 27 billion (€76 million) in wage assistance promised by the government to the sector, only HUF 7 billion (€19.6 million) have been paid out, and many restaurateurs say they’ve received no help at all.
In anticipation of the growing movement within the sector, the government on Saturday imposed draconian penalties for restaurants planning to open their doors in defiance of pandemic rules: such establishments may now be shuttered for six months to one year, and receive fines of between HUF 1 million-5 million (€3,000-14,000.)
As workers struggle to cope with the lockdown as it enters its fourth month – and was last week extended until March 1 – several high-value property purchases by prominent government ministers were discovered involving sizeable loans from banks connected to Fidesz’s so-called “System of National Cooperation” (NER).
On Tuesday, 444 reported that shortly before his wedding in mid-December, the head of the cabinet office of the prime minister Antal Rogán (Fidesz) became involved in a massive land deal worth HUF 1.6 billion (€4.5 million). Rogán’s new wife Barbara, her parents and two other business partners purchased more than 1,022 hectares in northeast Hungary at a down payment of HUF 83.2 million, or around 5 percent of the purchase price. The rest was supplied by a loan from the state-owned Budapest Bank, part of a bank holding company owned in large part by L?rinc Mészáros and other prominent Fidesz-tied businessmen.
Barbara’s family was not known to be wealthy in the village where they live. But according to Antal Rogán’s most recent asset declaration, he has HUF 822 million (€2.3 million) in savings. Two other December contracts were discovered by 444 showing the family purchased an additional HUF 182 million (€512,000) worth of land, 95 percent of which was financed by Budapest Bank.
It was also reported last week that in December 2019, Justice Minister Judit Varga and her husband purchased a 270 sq. meter apartment in an exclusive district of Budapest, just minutes from the home of Prime Minister Orbán, for HUF 200 million (€562,000). The pair made a down payment of HUF 8 million, and the rest was supplied by a bank loan. The property was reportedly sold at well under the market rate for other real estate in that district of the capital.
Additionally, it was reported that in 2017 the couple drew HUF 10 million (€28,000) in state aid under the family home creation allowance (CSOK) program, designed to assist young families with children to purchase or build homes. With the money, the couple built a tasteful home in Balatonhenye, a quiet, dead-end village near Lake Balaton.
The assistance, which does not need to be repaid, may only apply to homes intended for permanent habitation and may not be used for vacation homes. But given that Balatonhenye is 150km from Budapest, where both Varga and her husband live and work in prominent positions, it appears unlikely that the couple holds the property as anything more than a summer home.
Varga responded to questions concerning her use of the financial assistance, saying that when her family returned to Hungary from their previous life in Brussels, they had intended to move permanently to Balatonhenye, but ultimately remained in Budapest after finding work. Varga said that if the family has not moved to the summer home by the 5-year grace period allowed by the CSOK program, her family will repay the assistance to the state with interest.
According to the most recent Forbes list of the richest Hungarians, L?rinc Mészáros remains the wealthiest man in the country with assets totaling HUF 479.4 billion (€1.35 billion).
Hungary tied with Romania, Bulgaria as most corrupt country in EU
Hungary tied with Romania and Bulgaria as the most corrupt countries in the European Union according to an annual corruption report by Berlin-based NGO Transparency International.
The 2020 Corruption Perception Index ranks 180 countries and territories by their perceived levels of public sector corruption, drawing on 13 expert assessments and surveys of business executives. It uses a scale of zero (highly corrupt) to 100 (very clean).
(*) — Justin Spike is an independent journalist and fixer based in Budapest. He was the managing editor of the Budapest Beacon, an independent, English-language news portal dedicated to Hungarian politics and economy. He run InsightHungary in partnership with local news website 444.hu. He have done fixing work for Financial Times, France24, Aftenbladet, Heartland TV, and Princeton University. — !!444!!! InsightHungary, is one of the few independent media beyond the control of autocrat Viktor Orbán.