The Union wants Hungary to review its public procurement laws

The European Commission (EC) has called on Hungary to review its public procurement laws to curb systemic fraud before it has billions of euros at its disposal from the EU's post-corona recovery fund. This was stated on Monday by the Reuters news agency, referring to internal documents of the EU executive.

The changes would increase transparency

The European Commission will oversee a € 750 billion redistribution scheme in the form of grants and soft loans to member states and, according to Reuters, has already made it clear to several EU members that they need to improve their national proposals on how to use the funds for recovery and reconstruction. In a letter dated 26 January, the European Commission asked the government in Budapest for direct changes to Hungarian public procurement laws, noting in particular the shortcomings in practice in ensuring fair competition in public procurement, which according to an EC internal document is related to "systemic irregularities" 2019 led to the highest financial correction in the history of the Union Structural Funds. The Commission argues that the changes it proposes would increase the transparency and availability of data and lead to a fairer and more open procurement process and prevent fraud and, consequently, the recovery of incorrect aid. The Commission recalled that these are measures that can easily be included in the chapter on promoting digitization in the National Recovery Plan.

Irregularities have also occurred in the past

According to Reuters, the Hungarian government has not yet responded to its e-mail request for comment on the EC document. Hungary should receive almost € 6.3 billion from the recovery and resilience plan for non-repayable grants for domestic reform projects alone. If the European Commission and other EU Member States approve a national recovery plan with proposed spending for specific areas. Member States must send their national plans to the European Commission for assessment by the end of April at the latest. According to last year's report by the European Anti-Fraud Office (OLAF), Hungary had irregularities amounting to almost 4% of EU budget expenditure between 2015 and 2019, with the EU average at 0.36%. Slovakia had the second worst score: 0.53%.