Hungary makes changes to judiciary to comply with EU demands

Hungary faces an uphill struggle to free up tens of billions of euros of EU funding, even after the country’s parliament made changes to the judiciary to comply with rule of law demands from Brussels.

The parliament on Wednesday approved legislation aimed at addressing EU concerns over the independence of the courts under the illiberal regime of prime minister Viktor Orban — part of the reason why Brussels has frozen multiple EU funding lines for the country.

However, the legislation only addressed some of the wider concerns in Brussels over the erosion of the rule of law and civil liberties, as well as systemic corruption, officials said. The EU funding freeze is badly hurting the Hungarian economy, which is reeling from anaemic growth and inflation that at 25 per cent is twice the level of the EU’s other member states.

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Vera Jourova, European Commission vice-president for values and transparency, said the Hungarian parliament’s decision was a “very good step forward”. However, she told reporters that more information was required on all other reforms necessary for the release of recovery fund cash. “So it’s too early,” she said.

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Hungary wants to unblock €5.8bn in grants from the EU’s €800bn NextGenerationEU recovery programme. In addition, Budapest is trying to address commission concerns that are standing in the way of payments of regional funding approaching €22bn until 2027.

Hungary’s legislative package strengthens supervision of the courts by an independent judiciary council, curtails the scope of government action at the constitutional court and bars the government from referring cases to specific courts, automating the system to avoid meddling.

Fundamental rights

But first payment of Covid-19 recovery funding will only be possible once Budapest addresses more than two dozen “super milestones” relating to rule of law issues — only some of which have been addressed by the legislation.

Hungary also cannot claim reimbursements for cohesion spending until it fully complies with provisions in the EU’s charter of fundamental rights that are now part of the union’s budget legislation. Brussels has said it will hold back payments also because of a Hungarian law that discriminates against people on the basis of their sexual orientation and gender identity, as well as provisions that pose “serious risks to academic freedom and the right to asylum”.

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Mr Orban will face a long slog to get the rest of the EU funds and may never get the entire sum, as some monies are tied to political issues he is unlikely to relent on, said Márta Pardavi, co-chair of the Hungarian Helsinki Committee, a human rights group.

“A lot of the EU’s demands are still unmet and there is no visible sign of the government even thinking about solutions on them. There is an anti-corruption authority, for one, but we don’t see their concrete anti-corruption strategy, and you can’t conjure one up overnight.”

Budapest has not relented on other issues such as the governance of universities where life-long appointments of government loyalists to boards has led to a suspension of EU funding for student exchange and research and development programmes.

The Hungarian government on Wednesday insisted it was taking the necessary steps to respond to the commission’s demands, as it called for the release of funding. “Hungary has now fulfilled its obligations on the judicial system,” said justice minister Judit Varga. “We expect Brussels to pay out those EU funds that are due to Hungary.” - Financial Times