Hungary is Once Again in the Forefront of EU Development Policy29 April 2011
While implementing radical changes in the grant management infrastructure, Hungary could still ensure professional and effective drawdown of EU grant payments. As a proof of a successful transformation, interim payments are considerably faster during the new government’s term compared to previous years. It is really telling that Hungary could draw down more than twice as much funds in the last 10 months (four times as much on a pro rata basis) as in the previous three years. As a result of the new and effective development policy, more and more grant contracts are awarded and grant decisions are taken each month on national level, while on EU level Hungary is ranking higher and higher on drawdown lists.
By the middle of 2010 drawdown from the European Commission was only EUR 1.6 billion, which was only 6.4% of the whole budget. In the last 10 months this rate more than doubled. By the end of Q1 2011 drawdown of funds from the European Commission amounted to EUR 3.3 billion (approximately HUF 922 billion), which is 14% of the total budget provided for Hungary. This means that due to budgetary pre-financing Hungarian economy received a total of HUF 1672 billion of EU funding.
Hungary gave an exceptionally good performance in March regarding interim payments. In the last month Hungary's drawdown from the Commission was EUR 414 million, which is a quarter of the total payment to all member states. As a result of this considerable payment, Hungary ranks 6th among the 27 EU member states concerning all fulfilled interim payments.
The operation of the institutional system is now faster and more effective. This is proven by the fact that more project grant decisions were made and more grant contracts were signed on a monthly average in the last 10 months than in the previous 41 months. Share of human infrastructure development has risen exceptionally with more than a thousand positive grant decisions since last June, and the number of social developments also exceeds the figures of the previous 3.5 years.
Nearly 3000 of the newly signed grant contracts are related to economic development. These figures are a token of the determination of the Government and the National Development Agency to reach the goals of the New Széchenyi Plan regarding the fast and effective use of the available EU development funds and the implementation of a measureable and successful development policy.
Grant payments for major projects also increased by 150%. ("Major projects" are projects for which EU grants exceed HUF 13 billion. Major projects are approved by the European Commission based on member state proposals.) While by June 2010 the amount of payments to developers was only HUF 217 billion, by the end of Q1 2011 major project payments exceeded HUF 313 billion.
EU cohesion funds are grouped into separate financial funds. From 2007 onwards two so-called structural funds serve this purpose, the European Regional Development Fund (ERDF), the European Social Fund (ESF), and the Cohesion Fund.
The regional fund serves regional development. It is especially telling that in Southern Transdanubia and Northern Hungary more payments were made during the last 10 months than in the total of the development period that started in 2007.