Council green-lights Hungary's amended recovery plan, some money to be released
The Council today adopted implementing decisions approving the amended recovery and resilience plans (RRPs) of Belgium, Bulgaria, Croatia, Cyprus, Finland, Germany, Greece, Hungary, Ireland, Italy, Latvia, Poland and Romania.
Most of the amended recovery and resilience plans now include a new REPowerEU chapter. This will contribute to accelerating the countries' transition towards clean energy, diversifying their energy supplies and improving their energy efficiency.
Hungary's RRP
On 31 August 2023, Hungary submitted its amended RRP, which includes a new REPowerEU chapter.
The total financial contribution available to Hungary will now be €10.4 billion, €6.5 billion in grants and €3.9 billion in loans.
The modified plan puts significant emphasis on the green transition, allocating 67.1% of available funds to measures that support climate objectives, up from 48.1% in the original plan.
The plan has an important social dimension and foresees that 29.1% of funds are dedicated to realising Hungary's digital ambitions.
How much will Hungary get?
Finance Minister Mihály Varga announced the approval of the amended RRP. He said this way the country may receive the Recovery and Resilience Facility's (RRF) €3.9 billion loan and €0.7 billion part of the grant if it delivers on the 27 super milestones required to draw the full amount.
He explained that the RRP's €5.8 billion grant is now officially supplemented by a €4.6 billion item.
Two times 10% of this pre-payment is due to the Hungarian budget even though Budapest has not yet met the super milestones. The first instalment of €460 million could arrive in the budget by February, and the second could be paid by December 2024.
"We are confident that cohesion and recovery funds will be released soon," the minister stressed, according to a statement from the Ministry of Finance. As he said, the first instalments in the form of pre-payments from the RePowerEU chapter, which have just been approved, could arrive early next year, opening the way to the signing of a financial agreement for the payment of some €920 million, or almost HUF 380 billion, to Hungary.
Varga reminded that in addition to the REPowerEU aid, the Hungarian government will also contribute from the loan part mainly to investments and developments that support the green transition. Compared to the 48% of the original programme, 67% of the budget will go to such programmes, and the green focus of the revised plan is very strong. This shows that the Hungarian government is strongly committed to being a winner in the green transition, he added.
For the time being, the other Hungarian sources are still awaiting positive decisions from Brussels.
It is precisely the RRF's €5.9 billion that seems the furthest away from approval. For the €22 billion of cohesion funding, the government has already implemented a judicial reform, which could trigger the disbursement of €10 billion. To this end, just last night, the government published one of its vital amendments to the regulations.
A crucial regulation change
As regards the unblocking of cohesion funds for Hungary, the European Commission was essentially only waiting for a clause in the Curia's case allocation rules to exclude the possibility of human intervention. On Thursday, the Ministry of Justice has issued a one-paragraph text that could address this problem.
The Curia enters all initial documents it receives electronically in the order of their arrival, with the next registration number in the register of the case group, with the case being assigned a case number automatically, without human intervention.
In addition, according to the legislation, once in force, the Curia will publish on a weekly basis on its website the case allocation data, including the case number, date of arrival, date of registration, date of allocation, case group, chamber, composition of the chamber, the head of case allocation and the reason for the deviation.
it IS NOT FULLY UNDERSTOOD AND NOT EXPLAINED IN THE TEXT that THE REGULATION WILL ONLY ENTER INTO FORCE ON THE 61ST DAY AFTER ITS PUBLICATION, I.E. 6 FEBRUARY 2024.
The EU executive had two questions about the judicial reform, the second being about how is the right of Hungarian courts to have unhindered access to the Court of Justice of the European Union for preliminary rulings enforced.
It is not yet clear exactly what step is required for unhindered access to the Court of Justice of the European Union, or whether it is sufficient for the Hungarian government to send a letter of reply to the Commission indicating that it has met all the requirements. Local daily Népszava reported earlier that the Supreme Court's precedent-setting decision may still limit the right of judges to apply to the CJEU for a preliminary ruling, so they are expecting some remedial measure there.
Cover photo: EU
