23rd Mar 2017

Hungary's new leaders face tough reform agenda

  • The Hungarian parliament is set to see a major overhaul (Photo: EUobserver)

A lighter bureaucracy, a tougher criminal code, a "green bank" to support climate-friendly investments and obligatory sports activities in schools - these are some of the priorities of Hungary's future one-party government after the overwhelming election victory by the conservative Fidesz party.

With 68 percent of the vote, Fidesz does not need a coalition partner for the 2010-14 legislature. Its two-thirds majority, established in Sunday's second round ballot, gives it the power to push through constitutional change and serious reforms. It also raises expectations among Fidesz' faithful, with any potential disappointments set to rebound in the favour of the far-right Jobbik party.

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The new parliament's 386 seats will be filled by 263 Fidesz MPs, 59 social-democratic deputies, 47 from Jobbik, 16 from the liberal-green LMP faction and one independent member. The impact of Fidesz' victory has left the defeated parties reeling. The leader of the small conservative MDF party, pushed out of parliament, has resigned as has MSZP party chief Ildiko Lendvai.

Analysts for the Political Capital (PC) think tank believe Fidesz will not act swiftly to switch Hungary's constitution towards a French-style presidential system. Still, if the new government wants to keep voters happy, it will have to make good on promises to trim parliament and local government, moves which would require constitutional change.

PC director Peter Kreko said that plans to deliver a leaner local government are likely to meet heavy resistance from current holders of lucrative public office.

Fidesz party leader and likely next prime minister, Viktor Orban, wants to reduce the number of parliamentary seats from 386 to 200. In addition, experts believe he will go for symbolic changes such as rehabilitating the status of the holy Hungarian crown and introducing double citizenship as a gesture to Hungarian minorities living in neighbouring states.

Mr Orban has denied rumours that he intends to bring forward local elections scheduled for October. He said decisions of this kind need to be based on broad "national consultations" and could be introduced only in the longer term. Still, Fidesz seems to be serious about cutting back public administration costs from eight to six percent of GDP, which would amount to savings of some €1.8 billion. Another highly symbolic, although financially less important, move could be a salaries cap for board members of state-owned companies.

In the domestic security field, Fidesz has announced the strengthening of local police forces, with a special focus on the northern regions of the country. At the same time, the party plans to introduce a "three strike" rule for criminal offenders, meaning that anybody committing the same crime three times over would see their penalty doubled.

On taxation, the new government may try to close existing loopholes but has only limited room for promised tax cuts. Small and medium enterprises are the designated beneficiaries of whatever the new government manages to deliver. VAT on the building of "social flats" for the less well off is to drop to the EU's minimum five percent from the current 20 percent to help low-income families. By setting up a state-run green bank, Mr Orban also intends to boost sustainability and energy efficiency.

Fidesz wants to reintroduce the requirement that pupils who fail their exams in elementary schools repeat classes, a measure abolished by the social-liberal government. Additional mandatory sports classes will also be introduced to improve the comparatively poor physical shape of the country's youth.

The future leadership has already identified 13 investment projects contracted under the MSZP government for review, amid suspicions of corruption. Most concern large infrastructure projects and some are already under police investigation.

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