Hungarian government rejects report on flaws involving EU public procurement

By bne IntelliNews February 10, 2021

The Prime Minister's Office dismissed a report by Reuters that the European Commission had asked the Hungarian government to amend public procurement rules.

Reuters said the bloc wants outright changes to Hungary’s public procurement laws, according to a January 26 European Commission document laying out specific legal changes required by the government.

The European Commission is managing the €750bn stimulus scheme and has already told several EU states their proposals for spending their shares must be improved.

"Competition in public procurement is insufficient in practice," said the document, citing "systemic irregularities that led to the highest financial correction in the history of structural funds in 2019".

Hungary is slated to receive some €6.3bn in grants and €10bn in loans under the stimulus scheme.

PMO leader Gergely Gulyas called the Reuters report "fake news", saying the EC had not made any requests from Hungary on the matter of public procurement, formally or informally.

The government is in talks with the EC on the recovery fund and the 2021-2027 EU budget. Gulyas said the government expects the EC to "clear up" the matter and reject the claims made in the Reuters report.

Orban's cabinet chief said 98% of information on public procurements in Hungary is public, and that the number of invited, negotiated procedures have fallen from 3,600 to 274 in the past six years.

NGO Transparency International suspects that some 40% of public procurements in Hungary involves a single bidder, which means that there is little competition. TI says that there is a high risk of corruption stemming from the high proportion of single-bid procurements. 

The cronies of Viktor Orban are the main beneficiaries of public money. Former gas fitter Lorinc Meszaros has become the richest man in Hungary in a few years. His wealth has soared to HUF500bn (€1.4bn) in a few years.


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