Fidesz, the right wing ruling party won landslide victories three times (in 2010, 2014 and 2018), and got a supermajority in the unicameral Hungarian Parliament. Thereafter, it severely restricted societal controls. In 2010, Fidesz extended its power to a level that is unusual in liberal democracies, and appointed own loyalists to public institutions that are nominally independent from the executive power. Fidesz changed the electoral law transforming it towards a more majoritarian system and applied some gerrymandering. After 2010 the Fidesz governments have eliminated political and professional autonomy of most of the state institutions and transformed them into the instruments of the central government’s power undermining the system of checks and balances.
The capture of the state by influential groups – oligarchs and political players – has become the rule rather than the exemption across Central and Eastern Europe (CEE). Particularism, extractive institutions and favouritism seem to be overcoming universalism, inclusiveness and public integrity. In Hungary, an informal network including politicians, oligarchs and grey eminencies re-politicize the state in pursuit of political monopoly. Corruption has become centralized – and, in some cases, has been legalized.
Democratic checks and balances characterizing bourgeois democracies have been almost entirely eliminated, apart from the law courts. The judges have preserved their autonomy and their decisions have been still independent from the central government endeavours. But that’s also not a remedy for tackling corruption charges. The Achilles heel of the judiciary is the prosecution service, which prevents cases from being heard by law courts by making only very few indictments in those affairs in which pro-government players are involved.
A specificity of the Hungarian situation is that a strong tension between regulation and practice has developed since the ruling government captured the state in a steady process after 2010. On one hand, a large number of anti-corruption regulations have been in compliance with EU norms. On the other hand, execution and practice is particularistic and biased favouring loyalists and cronies. One of the most obvious examples for that is how the public procurement system works in paper (the regulation is in compliance with EU norms), and in practice (the implementation benefits the loyalists).
The split of the Hungarian society is more profound than any time in the recent thirty years. An obsession with centralization, populistic rhetoric, and the government’s measures have divided Hungary’s citizens on one hand into loyalists, cronies and clients, and, on the other hand, those whom the government portrays as foes, e.g. the representatives of the independent NGOs. Under the new law regulation for the civil society organizatons (CSOs) that was adopted in 2017 those CSOs which get more than EUR 23 thousand foreign funding per year have to declare themselves as „foreign funded organizations”. Another bill, the so-called „Stop Soros”, was approved on 20 June 2018 targeting and criminalising the work of those organisations which assist to refugees under the pretext of countering „illegal migration”. But despite these measures, and the populistic rhetoric and smear campaigns against civil society, still there has been a certain gap between words and actions. The campaigns usually lack administrative sanctions, or if they exist in paper, they are not implemented.
Media pluralism continued to decrease with more and more outlets espousing a pro-government line, either as a result of ownership by people close to the government or direct government influence. December 2018 saw the merger of nearly 500 mediaoutlets into one conglomerate loyal to the government, seriously impeding media pluralism in Hungary. Pro-government media continued to smear critical journalists and media outlets.
Prime Minister Viktor Orbán`s government continued its dismantling of democratic institutions and the rule of law in 2019 as well.
In February, the government resumed its policy of denying food to rejected asylum seekers in the transit zones on Hungary’s border with Serbia.
In March, Fidesz was suspended from the European People’s Party (EPP) for breaching the group’s values concerning rule of law and fundamental rights but was allowed to remain part of the EPP group in the European Parliament. An internal investigation is ongoing at time of writing.
In June, the government renewed its attacks on academic freedom by introducing a law, approved by parliament, that increases state control over the Academy of Sciences. The law gives the government greater influence over scientific research and funding.
In July, the European Commission launched legal action against Hungary over the practice and referred to the EU Court of Justice the 2018 law criminalizing support to asylum seekers by NGOs. The Commission escalated the case in October. The European Court of Human Rights ruled that the government’s decision in 2015 to deny a journalist access to a refugee reception center violated media freedom.
In November, the government proposed changes to the administrative courts that would allow state institutions to appeal unfavourable administrative court decisions to the Constitutional Court, where a majority of the judges are close to the ruling party. This could affect issues like corruption, elections, and police conduct. The measures were before the Hungarian parliament and was adopted in December 2019.
Hungarian politics in 2020 will be different from 2019 in a number of ways. After years of paralysis and disarray of the Hungarian opposition, they are back in the political game after a surprise victory at the municipal elections in October 2019.
The surprise result of the local elections is the single most important political event in a decade and their aftermath is closely watched for signs of where Hungary might be going. Today it is still too early to tell how exactly strategies and politics would change – either on Fidesz’ side or in the opposition.
The shock and surprise of the not complete victory had visibly shaken Fidesz politicians and the party is slow to draw conclusions.
PM Viktor Orbán may also be reluctant to openly commit to any new direction before Fidesz’ situation in the EPP is settled, one way or the other. On 20 March 2019, EPP made a decision to suspend the ruling party of Hungary, Fidesz, from its membership. EPP decided to set up an independent Evaluation Committee tasked not only with assessing whether the Hungarian government stopped with anti-EU campaign and resolved the status of the Central European University, but also thoroughly assessing the rule of law and the respect for EPP values. There have since been no follow-ups to this decision; the Evaluation Committee has not delivered any public conclusions, and Fidesz remains under suspension.
There is also the Article 7 procedure hanging above him, and – more importantly – the fate of the EU development funds and their continued flow to the regime.
According to the EU Fundamental Rights Agency Hungarian Roma continued to face discrimination in housing, education, and public health care. With the economy slowing, and his anti-immigration campaign losing steam, Orbán is seeking to mobilise his voters by targeting independent courts, the Roma minority, and the NGOs which help them. He has come under fire from the EU for his perceived erosion of the rule of law. Orbán suggested the state should disobey court orders to pay compensation to Roma children, who had been unlawfully segregated in the village of Gyögyöspata and provide training instead.
Hungary’s parliament will consider to accept an emergency bill end of March 2020 that would give Orbán sweeping powers to rule by decree, without a clear cut-off date. The bill seeks to extend the state of emergency declared earlier in March over coronavirus, and could also see people jailed for spreading information deemed to be fake news. The government has portrayed the move as a necessary response to the unprecedented challenges posed by the coronavirus pandemic, but critics immediately labelled the legislation as dangerously open-ended and vulnerable to abuse.
Sustainable Development Goals in Central and Eastern Europe
According to the 2019 Europe Sustainable Development Report (ESDR) further actions are still required to make CEE a sustainable region. ESDR identifies key priorities for the EU to achieve the Sustainable Development Goals (SDGs) set by the United Nations and implement the Paris Climate Agreement.
The new President of the European Commission Ursula von Der Leyen has already committed to a European Green Deal to achieve climate neutrality by 2050. As she stated in her manifesto: “This is the European way: we are ambitious. We leave nobody behind.”
The European Green Deal must include an EU-wide strategy to fully decarbonise the energy system by 2050, strengthen the circular economy, achieve greater efficiencies in resource use and dramatically decrease waste, as well as promote sustainable land-use and food systems by 2050.
The EU and its member states face the greatest challenges on goals related to climate, biodiversity, and circular economy, as well as in strengthening the convergence in living standards, across countries and regions. In particular, countries need to accelerate progress towards climate change, sustainable consumption and production, protection and conservation of biodiversity, and sustainable agriculture and food systems.
Furthermore, many countries are falling back on leaving no one behind, so the EU’s SDG strategy must place emphasis on strengthening social inclusion for all people living in its territory. Education and innovation capacities must be improved to raise living standards in poorer member states and accelerate the convergence in living standards.
Three CEE countries, namely Czechia, Slovenia and Estonia are closest to achieving the SDGs but non of them are on track to achieve the Goals by 2030.
The CEE countries face significant equity challenges characterised by greater poverty rates and material deprivation but also gaps across population groups in access to care, quality education, and infrastructure (including broadband internet connection). Women are also more often underrepresented in public institutions and report higher levels of insecurity.
Hungary`s performance in achieving the SDGs
Transparency International Hungary (TI) made an in-depth assessment of the SDGs and revealed serious deficiencies and challenges. According to TI the main reason is why some of the development goals are not or not sufficiently met has been the fact that corruption has become institutionalized and systemic in Hungary.
Overall, Hungary’s performance in achieving the SDGs is average. Hungary performs relatively well in the indicator measuring decent work and economic growth. However, significant challenges remain, in particular, in improving the quality of education.
Some key structural issues, which point to particular challenges for Hungary are the following:
- Employment increased and unemployment decreased in line with the good economic situation but not all groups benefited equally from labour market expansion. The number of women in work or training remains relatively low, also due to the limited availability of childcare. Outward migration and population ageing put pressure on the size of the workforce. A majority of firms in the industry and building sectors report labour shortages as a factor limiting production. The performance of the public employment services, including the targeting and efficiency of policies to help people find or stay in work, could be improved.
- The overall poverty situation has improved markedly in recent years but challenges remain. Income inequality has been increasing, inequalities in access to public services persist and the proportion of people experiencing difficult living conditions is among the highest in the EU and is particularly high among families with several children and the Roma. Poverty and social exclusion are concentrated in certain areas. Key elements of the social safety net have weakened over the past years. The low and shrinking supply of social housing is becoming a challenge against a backdrop of rapidly rising residential property prices.
- Educational outcomes are below the EU average and large differences between schools remain, hindering social mobility. The impact of the socio-economic background of pupils on their educational outcomes is one of the strongest in the EU. Concentration of disadvantaged and Roma children in certain schools has increased in the past decade, particularly in cities. The incidence of early school leaving is above the EU average, and especially high among Roma. The new strategy on vocational education and training aims to attract more students to vocational schools but makes it more difficult for them to switch to the general education path. The shrinking pool of applicants to higher education is likely to limit tertiary educational attainment rates, which holds back innovation and productivity growth. The shortage of teachers is increasingly challenging.
- Although improving, health outcomes remain worse than in most other EU countries, reflecting both unhealthy lifestyles and the limited effectiveness of health care. This is shown by Hungary’s high mortality rates from preventable causes. The public share of health spending in Hungary is considerably lower than the EU average. Consequently, an above-EU average number of Hungarians rely on out-of-pocket expenditure and are increasingly pushed to turn to private care to access health services, with repercussions on social equity as well as population health outcomes. The health system remains excessively reliant on hospitals to provide care services, with insufficient focus on primary care and prevention. Additional investment and reforms are necessary to rationalise the use of resources within the health system, reduce inequities of access and raise quality of care to EU standards.
- Environmental sustainability is a challenge. Hungary is targeting a modest reduction in greenhouse gas emissions from current levels by 2030, mainly through the phasing out of coal-fired power plants. The latest National Energy Strategy aims to increase electricity generation from low-carbon sources to 90% of the total by 2030. In addition to nuclear, Hungary intends to rely more on renewable energy sources, mainly solar energy; by contrast, wind energy does not have any role in the government’s current plans. The low energy efficiency of housing and polluting residential heating methods make air quality worse and both point to large potential environmental and health gains to be achieved by stepping up renovation rates. Greenhouse gas emissions from transport have increased strongly over the last five years and emissions are projected to continue increasing under current policies. The government intends to address transport emissions by promoting electromobility. However, questions remain concerning plans for building charging infrastructure and for promoting other alternative fuels. Identifying investment needs in green technologies and sustainable solutions, and securing adequate funding will be key to delivering on the climate and energy objectives and shaping a new growth model. Water quality and supply remain concerns. Hungary is only at an early stage of moving towards a circular economy and waste management needs to be improved to meet 2020 recycling targets. Institutional issues impede more effective implementation of environmental laws and policies. These environmental challenges require investment and institutional capacity building. The Commission’s proposal for a Just Transition Mechanism under the next multiannual financial framework for the period 2021-2027, includes a Just Transition Fund, a dedicated Just Transition scheme under InvestEU, and a new public sector loan facility with the EIB. It is designed to ensure that the transition towards EU climate neutrality is fair by helping the most affected regions in Hungary to address the social and economic consequences.