Thank you for the floor, Mr. Speaker. Honourable House, Honourable Members of Parliament,
According to our constitutional traditions, with the Honourable Speaker’s permission I will now render an account of the most important developments in the period between the two parliamentary sessions. First of all European affairs. In Europe the summer was varied and active, with a series of elections – some of which have important consequences for Hungary. But now I would only like to give you a summary of the European Union’s four-day summit. The 27 prime ministers of the European Union reached an agreement on behalf of their states. The subject of this agreement is the budget system and specific budget items for the next seven years – but I think it will rather affect the next ten years. Unlike earlier practice, the budget for the next seven to ten years will consist of two parts: there is the usual budget with the usual structure; and there is a fund called Next Generation EU, the purpose of which is to compensate for the devastating effects of the pandemic. Prior to the talks in Brussels, Parliament identified tasks for me and the Government. We tried to fulfil these tasks to the best of our abilities. We were working with an excellent team, with dozens of specialist diplomats supporting our work in both Brussels and Budapest simultaneously. I would like to thank them for their efforts. Parliament’s first and most important expectation was for the budget for the coming years to ensure that Member States in similar situations are treated similarly. Therefore I will first say a few words about the financial part of the agreement. As regards Hungary, if we fully account for everything, the result is a net inflow into the Hungarian economy of 31 billion euros. This will be 4 to 4.5 billion euros annually. How much is this? A lot or not much? Our approach, the Government’s approach, is different from that which is conventional. We look at the overall balance of incoming and outgoing financial items flowing into and out of Hungary. In 2019, foreign businesses operating in Hungary generated total profits of 9.6 billion euros. I’m not saying that they took this much out of the country, because some of it was reinvested; but 9.6 billion euros is the amount they could have taken out of the country. During the same year, Hungarian businesses generated profits abroad of 1.6 billion euros. The balance of the two is minus 8 billion euros annually. If I deduct from this the European Union funds intended for Hungary, which is 4.5 billion euros, the annual deficit is around 3.5 billion euros. Looking at it from this point of view, the amount which we negotiated in Brussels will significantly reduce our capital deficit. It is not a subject for this report, but let me just mention that, although there are different estimates, by 2028 Hungary could be close to becoming a net contributor to the European Union budget. The Czechs certainly will be, and the Polish and we probably will be. So, provided that Hungarian capital abroad maintains its capital and capacity to generate profit at its level for 2019, by 2028 we should reach the point at which we generate an annual profit abroad of 9.6 billion euros. That is when we would attain balance. At present we are generating 1.6 billion of this. It’s far removed from the subject of this report, but I’ll mention that we can achieve this goal in one of two ways. The first is by buying out foreign companies operating in Hungary. I can inform you that this is already happening. The second is by increasing Hungarian investments abroad. We are also doing this.
Ladies and Gentlemen,
In summary, I can tell you that Hungary successfully fulfilled Parliament’s expectation that Member States in identical situations should be treated identically. Of course to achieve this we needed to amend the originally extremely unfavourable proposal. So in the end ours is the sixth highest amount, and apart from Lithuania – who are our friends and so we needn’t begrudge them this – all the countries receiving more than us have national incomes smaller than Hungary. Therefore, based on the objective numbers, I can tell you that I fulfilled Parliament’s first and second objectives.
In accordance with the mandate laid down in the parliamentary resolution, I moved that the Article 7 procedure against Hungary should be concluded during the German presidency. You know that for two years now the European Parliament has been conducting a procedure against Hungary, as a result of a politically motivated, legally questionable decision. They asked us questions, which we believe we have answered. We believe that we have dispersed all doubts and refuted all the accusations that have emerged in connection with the functioning of Hungarian democracy and institutions relating to the rule of law. Therefore in our opinion there is no obstacle to concluding this procedure. The German government’s representative confirmed this intention, but made no promise of any kind, and we received no guarantee of any kind. The Chancellor said she would try to ensure that this happens.
Based on Parliament’s decision, I proposed to the council of prime ministers – but without success – that EU funding should no longer be provided to political parties and groups engaged in political activities which claim to be civil society organisations. My proposal provoked fierce opposition. Today, Honourable Speaker, all I can commit to doing on behalf of the Government is to ensure that Hungary will keep this issue on the agenda. I must not give Parliament advice, but perhaps it would be a good idea if a separate task force in Parliament dealt with this issue.
Lastly, I’d like to inform the Honourable Speaker and the Hungarian parliament that we also took an important step towards ensuring that the distribution of funding is not linked to political and ideological conditions. In the Council we made it clear that we are committed to the rule of law. This is laid down in the Fundamental Law. And we were also committed to it when, under communism, we had to fight for the rule of law against a dictatorship. And we were also forthright in asserting that sweeping together a number of legally indeterminate political accusations into a category marked “rule of law” is itself a violation of the fundamental principles of the rule of law. What the European Left refers to as the “rule of law” is in fact the rule of blackmail: it is not about the rule of law initiative, but a blackmail strategy. Together with Poland we managed to foil the institution of EU procedures aiming to blackmail us, which would have affected Hungary’s cohesion funds and financial interests. We managed to ensure that no such steps endanger Hungary’s financial interests. On Thursday and Friday – inconvenient dates on several counts, but on Thursday and Friday – the Council will hold an extraordinary meeting. News has spread that this issue will also be on the agenda. This is not true: the Greece-Turkey conflict will be on the agenda. This is the reason we are convening.
And now the pandemic, Honourable House,
We have been through a difficult period, and a difficult period lies ahead of us. A pandemic unprecedented in living memory originated in Asia and soon reached Europe, including Hungary. According to today’s aggregate data, so far 31 million people have been infected worldwide, and the number of those who have lost their lives is almost 1 million. According to today’s latest data, there are 5,960 new cases in Russia, 4,429 in the United Kingdom, 2,044 in the Czech Republic, 1,916 in the Netherlands, 1,685 in Germany and 1,637 in Austria. The latter is the most alarming, because in Austria the number of people requiring hospitalisation – those in difficulty – has risen by 35 per cent in a single day. So far we have seen Austria as a kind of laboratory, and I believe it is right for us to continue to do so: what is happening there will happen here in Hungary somewhat later. For this reason we must take this number seriously.
I would remind my fellow representatives that in Hungary we registered the first infection on 4 March. And as there was no vaccine – just as today – and we were up against an unknown enemy, we had no choice but to slow the spread of the virus. The essence of our strategy was on the one hand to gain time, and on the other hand to find out more about the enemy and give ourselves the chance to prepare the healthcare system. In just a single week in the spring the country switched over to a new, previously unknown operating model. We started our defence operation sooner than most European countries. We set up the Operational Group on 31 January, even before the appearance of the virus in Hungary, because we knew that those who gain time gain lives. I thank Professor Kásler, who in good time recognised the threat to Hungary represented by the virus – which at that time was still far from us. The first weeks came as a shock, but the country stood its ground, and we won the first battle. The facts speak for themselves: the Hungarian healthcare system – which is so often criticised, defamed and unjustly attacked – was able to protect people. So our first words should be those of thanks. We must thank doctors, disease control experts and nurses. We must thank Chief Medical Officer Cecília Müller and the Operational Group. And I would especially like to thank Minister Kásler and Minister Pintér for their hard work.
That is now in the past. The second wave of the virus is here: we’re in the midst of it, it has arrived as was expected, and as we expected. Like the first wave, this has also come from abroad: it has been introduced into Hungary from abroad. This is a global pandemic. We live in a globalised world, and so everyone not only receives the associated benefits, but also its challenges – such as the virus. I can inform the House that in the autumn of 2020 we are better prepared than we were in the spring of 2020. This is for two reasons: firstly, we now have the experience of the spring defence operation; and secondly, in the summer we successfully organised a timely national consultation. In the national consultation people sent a clear message to the Government: Hungary must continue functioning. People expect us to protect both lives and jobs; during our defence operation they expect us to prevent the virus from once more paralysing everyday life. This means that we must defend ourselves against the virus by simultaneously protecting the lives of the elderly, who are most at risk, protecting the operation of our schools and nursery schools, and protecting jobs. This tactic is different from the one we pursued in the spring; accordingly, our battle plan is also different, and our response will be different from that during the first wave. Today no one should worry that they might not receive appropriate care.
Based on the Operational Group’s recommendation, the Government adopted the following decisions. As the virus was introduced from abroad, in order to cut off its supply lines we shall continue to maintain the restrictions on entry to the country. We are making the use of face masks compulsory in a wide range of situations: in addition to public transport and shops, masks must be worn in theatres, cinemas, healthcare and social institutions, customer service offices and the public service areas of government offices. Anyone breaking this rule will be subject to a maximum fine of 50,000 forints. This is what can be imposed today, but I have initiated an amendment to the relevant legal rule to enable us to increase this amount. We are maintaining a total ban on visiting hospitals and elderly care homes. On 1 October we will introduce mandatory temperature checks in schools for children and teachers. Only teachers and children will be allowed to enter school buildings, although the parents of pupils in the lower grades will be allowed to accompany their children to temperature testing points. We are fixing the price of coronavirus tests performed by the authorities at a maximum of 19,500 forints, and the flu vaccine will be free for anyone who wishes to receive it. Entertainment venues and catering establishments will be required to close at 11.00 p.m.
Ladies and Gentlemen, Honourable Speaker,
Saving lives is the responsibility of everyone, not only doctors and nurses. Every single person is part of our defence operation, and this time the degree to which this defence operation is successful really will depend on us all. Young people must realise that now they are the people who are most likely to carry and spread the virus, even if they don’t even notice that they have been infected themselves. If they fail to observe the rules, however, they could endanger the elderly and the sick – especially those in their own families and immediate surroundings. We ask young people not to forget this. They – I hope – can cope with the virus easily, but the infection could overwhelm the elderly and the sick. Please look out for your parents and grandparents. I have seen and read that many people want to know what might be the maximum load which the healthcare system will need to cope with – and indeed whether it will be able to cope with that maximum load. I can tell you that the mathematicians, researchers and practising medical professors say that in a worst-case scenario we can expect up to 200,000 active infections in Hungary at any one time. International experience indicates that in a situation in which 200,000 people are infected, 16,000 of them will need hospitalisation and 800 will need to be put on ventilators. How much faith one has in what mathematicians and doctors say is a personal matter. To be on the safe side I’m allowing for the possibility that the numbers might be double this, and so I say that the Hungarian healthcare system should be able to cope with as many as 400,000 infections at any one time. In this scenario we would need not 16,000 beds but 32,000, and we should be prepared not for 800 people requiring ventilators, but several times that many.
Ladies and Gentlemen,
Today Hungary has 66,000 hospital beds, and if necessary we can open further temporary hospitals. The deployment plan developed in the spring is in effect. In essence this means that if a designated hospital runs out of capacity, another one will be added to the list of designated hospitals to which we will transfer healthcare workers, doctors, nurses and technicians from other institutions. All equipment and all healthcare specialists operating them have their designated places.
Honourable Speaker, Honourable House,
The economy. You know that the coronavirus is not only a threat to our health, but also to our jobs. If there is work there is everything. This is why we made it clear at the beginning of the pandemic that we will create as many jobs as the virus destroys. This is why, among important issues, protecting Hungarians’ jobs was, is and will be a special priority. We shall not compromise on this. Where do we stand now? In August there were more people in work than there were in January: in January 4,458,000 people were in work, while today – or at the end of August – the figure is 4,500,000. Various grants, investment and wage support schemes have resulted in almost one million Hungarians having access to some kind of work or training support. Applications for job retention grants have been received from 15,000 Hungarian businesses, benefiting more than 207,000 employees. Up to 31 August, almost 37,000 businesses had submitted applications for job creation salary support, thereby pledging to create 49,000 new jobs. So they will not only retain jobs, but create 49,000 new ones. In order to retain highly qualified workers in the research, development and innovation sector, we have committed to a 40 per cent salary support contribution over three months. More than 1,100 companies submitted applications for this, benefiting around 23,000 people. So in summary there are jobs and there will be jobs.
But, Honourable Fellow Representatives, a job is just one thing that someone wants to keep safe; the other is one’s home. This feeling has been especially strong since 2008, when banks repossessed the homes of tens of thousands of Hungarian families. Therefore we must not only keep jobs safe, but also homes. We decided to extend by six months – to 1 July – the debt repayment moratorium for families raising children, pensioners, the unemployed and people in public works schemes. The extension of the debt repayment moratorium is automatic, meaning that those who have benefited from it so far will have nothing further to do. Through this moratorium we have protected the homes of 1.6 million people, and have also left 2,000 billion forints with families and businesses. This is the equivalent of 4.5 per cent of gross domestic product, of GDP. I believe that this is an enormous feat. If you look around Europe, you will not see another nation which has shown so much solidarity of this kind.
Jobs can be created through investment, and this is why we decided to invest in our companies. The Government’s programmes are not bailout packages, but investments. They are not only intended for the present, but also for the future. Think back to what I said about the country’s balance of profits. When everyone, all other countries, are implementing austerity measures and are shrinking, the goal is to not just to defend ourselves, but to facilitate growth and development. This is why we launched an investment incentive programme for the protection of jobs in Hungarian businesses. Due to unprecedented interest, we almost immediately had to increase the allocation for this and, tripling the original allocation of 50 billion forints, we have invested 170 billion forints in Hungarian businesses. The result is more than tangible: 904 investors applied, pledging to invest a total of 424 billion forints in the upcoming period, and thereby protecting the jobs of 154,000 Hungarian workers. We also launched a programme for development of Hungarian small and medium-sized enterprises. So far 5,500 funding applications have been submitted within this, pledged investments total some 193 billion forints, and the number of jobs which have been protected is around 130,000.
Honourable Speaker, Honourable Fellow Representatives,
Summing up the effects and results of our economic measures, I can tell you that so far we have managed to protect Hungarians’ jobs and homes, and it seems that we have also succeeded in appropriately strengthening our businesses. In other words, we are able to relaunch our economy. Remember that between 2010 and 2014, following the Left’s tragic period in office, we had already managed to help Hungary back on its feet and relaunch its economy. Since 2010 we have created one million new jobs. And let’s not forget that in the spring we successfully warded off the first wave of the pandemic, by joining forces with the Hungarian people and acting together: not as the Government, not as ministers, but as Hungary. We are doing the same now.
A difficult autumn lies ahead of us, but we have done this once before, and together we shall succeed again.
Thank you for your attention.