It is an absolutely realistic target for Hungary to absorb 100 per cent of the EU funds available for the period between 2007-2013, and no one calls this into question any more, Nándor Csepreghy, Deputy State Secretary for Development Policy Communication said in response to the latest report of the international consulting firm KPMG.

According to KPMG’s annual report EU Funds in Central and Eastern Europe, 87 per cent of the funds made available during the EU grants cycle between 2007-2013, some EUR 21.7 billion already reached beneficiaries in Hungary by the end of 2014, which represents a 25 percentage-point improvement compared with the 62 per cent payment ratio in the year before, and exceeds the EU average.

Mr Csepreghy stressed that KPMG’s progress report justifies the measures adopted by the Government for the transformation of the system of development policy, including the measure as part of which the operation of the former National Development Agency and the overseeing of the use of EU funds were delegated to the Prime Minister’s Office in 2013.

The results of these major reforms are also reflected in the KPMG report. Hungary will be able to run the course which was laid down before it during the period between 2007-2013, the Deputy State Secretary stated.

The report confirms that 87 per cent of the total EU allocation was paid to beneficiaries in Hungary by the end of 2014, and Hungary thereby occupied second position in the region. At present, the payment level of the 2007-2013 cycle stands at HUF 7,706 billion, and less than HUF 500 billion will have to be disbursed for the full withdrawal of the allocation, Mr Csepreghy said.

From among the countries of the region, Hungary was able to make a more than 10 per cent over-commitment last year; this was necessary in order to fully guarantee the 100 per cent absorption rate, the Deputy State Secretary pointed out, and remarked that the report also demonstrates that there were neighbouring countries in 2014 which were not even able to contract the entire available allocation, and thereby forfeited the possibility of using 100 per cent of the available funds.

The Deputy State Secretary pointed out that the significant progress made in the absorption of EU development funds is linked to the reforms introduced in 2013, and the emergence of the Prime Minister’s Office on the scene. At this point in time, a number of measures were adopted which are responsible for the results recorded today, such as the introduction of expedited settlement, or the possibility of exemption from supplying collateral which released significant resources for applicants, and the elimination of the National Development Agency which created a direct link between applicants and policy stakeholders.

The story of the absorption of EU funds is very much like a long-distance race in which those countries will prove to be successful which reserve their strength for the last stages of the race which decide who will reach the finish line first, Mr Csepreghy said. He took the view that the Government was able to respond to the emerging processes on an ongoing basis, and was leading development policy in the right direction.

The Deputy State Secretary said that the suspensions by the European Commission affected quite a few programmes; a measure which is a commonplace practice in Brussels in the operation of the system for the management of contradictory situations. The Member States must therefore prepare for handling the issues that may emerge in the event of suspensions by the Commission from their over-commitment allocations. The Hungarian over-commitment contains the reserves which are able to guarantee a 100 per cent absorption rate even in the event of adjustments made upon the conclusion of suspensions.

(Prime Minister's Office/MTI)