The government reached its economic goal for 2023 and broke „war inflation”, as inflation fell to 3.6% in March, Gergely Gulyás, the head of the Prime Minister’s Office, told a government news briefing, adding that 2024 would be the year of „re-starting the economy”. Commenting on economic indicators for the first quarter, he said goals for 2024, too, had been fulfilled so far, „despite the war environment dampening European growth”. GDP grew by an annual 1.7% in the first quarter, and by 0.8% quarter on quarter, putting Hungary among the fastest growing EU member states, he said. Annual growth is the third highest in the EU, while quarter-on-quarter growth is the second highest, he said. He said forecasts were less certain as long as the war in Ukraine was still ongoing, adding, however, that the 2.5% growth forecast for 2024 and the 4.1% growth projected for next year were „realistic” despite the current circumstances. Gulyás welcomed the incipient recovery in consumption and the increase in retail sales in the first three months of 2024, following 13 consecutive months of decline. In the tourism sector, commercial and private accommodations registered 7.1 million guest nights in the first quarter, a 14% increase compared with the same period last year, with the number of foreign guests rising by 18% to 2.9 million, he said. Gulyás also said more than one million more people had jobs than during the Fidesz government’s left-wing predecessor, while the minimum wage has grown 3.5-fold and the average wage 3-fold since then. Government spokesperson Eszter Vitalyos said more than 3,100 families have applied for over 83 billion forints in CSOK Plusz home purchase subsidies so far, with the applications averaging 26 million forints. More than 35 billion forints had been awarded to more than 1,400 families by the end of March, she added.
Meanwhile, she said more than 210 billion forints-worth of developments have been carried out across the country, of which 180 billion has gone towards public road upgrades.
Regarding domestic politics, Gulyás said Gergely Karácsony, the mayor of Budapest, should admit to accepting unlawful funding from abroad for his election campaign in 2019.
In connection with the Tisza Party’s entry into the Budapest municipal election campaign, Gulyás said the election rules were amended six months ago in line with the opposition’s request for a purely party list system; the change had not been made because of the Tisza Party. Commenting on the increasing popularity of Péter Magyar’s party, he said „a wrecking derby” was taking place within the left wing, and „voters will decide which leftist party to support.” „It would be unsurprising if Tisza fielded candidates who would work in Brussels to prevent Hungarians from paying lower public utility fees,” he said. „The Hungarian left wing has always been against” the government’s scheme to keep household energy bills low. „In the end Péter Magyar and [former Socialist PM] Ferenc Gyurcsány will form an alliance … causing a serious loss of credibility to the leftist parties.”
Gulyás said the government would increase tax breaks for families with children once the necessary resources were available. He conceded that though tax benefits for families with two children had increased by 100% in the previous government term, the personal income tax breaks offered „significantly less help today than when they were first introduced”. He said the government intended to increase the size of the tax breaks, „but no such decision has been made yet”. He said the reason behind last month’s fall in the budget deficit had been a 10% increase in budget revenues, noting that that the government targeted a deficit of 3.7% of GDP in 2025 and 2.9% in 2026.
He said retail sales were up compared with 2023, noting that they grew by 4.2% in March, with food sales alone rising by 5.7%.
Meanwhile, Gulyás attributed the fall in the industrial output to the slowdown of the German economy, but said it had only made a dent in the „higher-than-expected growth rate”. He expressed hope that industrial output figures would improve in the future.
As regards motor fuel prices, he said Friday’s price cut would bring prices at the pump below the average prices in neighbouring countries, and expressed hope that local fuel companies would keep to their agreement with the Hungarian mineral oil association (MÁSZ). Meanwhile, Gulyás said the cabinet had not discussed lowering the price of single-day motorway vignettes to 1,000 forints.
Asked to comment on figures published by national health insurance fund NEAK which show that 47,000 Hungarians are on waiting lists for scheduled operations as against 40,000 last year, Gulyás said the government planned to discuss proposals to shorten the waiting lists. Out of thirteen types of operations, patients currently have to wait longer than 60 days for cataract, hip and knee replacement surgery, and spinal stabilisation surgery. The goal is that no one should have to wait for operations, he said, pointing out that though there were more people on the lists this year, this did not mean that they had to wait longer. He added that the average wait time had decreased from 90-100 to 45 days. Government spokesperson Eszter Vitalyos added that when waiting lists were the longest, 43,000 patients had to wait for more than 60 days for operations, and now there were 26,000 such patients.
Meanwhile, Gulyás said the government has earmarked 63.4 billion forints for the settlement of hospital debts, „and it’s very likely that another similar decision will have to be taken his year”. Asked if the government will give supplementary funding to the struggling Budapest University of Technology and Economics (BME), Gulyás said the financing of higher education institutions would be discussed at the next few cabinet meetings. He added that Hungary had increased government funding for higher education more than any other EU country over the last 2-3 years.
Asked to comment on the BME rector’s remarks that state-financed universities did not receive a share of these resources and were being pushed towards a new management model, Gulyás said state universities had also seen pay hikes in recent years, though not as significant as the institutions that had adopted the new management model. He added that the option of switching to the new model was open to all universities.
Asked about the court ruling suspending the environmental permit of the Samsung battery plant in Göd, near Budapest, Gulyás said the decision had to be complied with. He said the Hungarian authorities were experienced when it came to handling cases concerning the operations of battery plants, adding that the factories had to adhere to the strictest environmental protection standards. Asked about the proposed rail shuttle service that would run to and from the Liszt Ferenc International Airport, Gulyás said Hungary needed to explore the possibilities for building a direct rail link between the airport and Budapest and accept the best offer, adding, at the same time, that speculation on any such project was „premature”.
Meanwhile, on the topic of the Iranian ex-president’s visit to the National University of Public Service, he said no government member had met the „well-known Holocaust denier”, adding that „it is not easy to ban university lectures in a free country”. The government, he noted, maintained a pro-Israel policy.
On the subject of Europe, Gulyás said that even now he would vote for Hungary to join the EU despite „bad feelings” and „worries about the EU’s operations”. „Hungary has no alternative to European cooperation and the common market, and this is true of the other countries of central Europe,” he said.
Commenting on the European Commission’s readiness to scrap the Article 7 procedure against Poland, Gulyás said Poland now had a „pro-war government which the commission considers as an ally, and which is sufficient reason to close the procedure… Rule of law issues in the EU no longer have anything to do with the law; they have become a purely political matter.”