Weekly newsletter

After experts labeled Budapest’s partly-new South Circle railway project, to be built by Orbán-ally businessman Lőrinc Mészáros, “staggeringly overpriced,” the government denied any such claims. A state secretary said that experts are “ignoring many aspects of the project.” Leftist daily Népszava, meanwhile, claims that Lőrinc Mészáros won the project without any other serious contenders.

In short, the South Circle Railway project involves the track revamp and extension of the 7-km-long section between the Ferencváros and Kelenföld stations, in addition to the establishment of two new stations.

Experts: “staggeringly overpriced”

As we previously reported, V-Híd Zrt., a company owned by Lőrinc Mészáros, has won the largest part of the tender with a net bid of HUF 337.9 billion (EUR 945 million). In reference to unnamed experts, economic site G7 reported that the project is “staggeringly overpriced,” as professionals estimate such a job to normally cost around HUF 30-50 billion (EUR 84-140 million) at most, which is only a tenth of Mészáros’s winning bid.

The economic investigative site also compared the bid with other similar projects across Europe, which also found that the development even stands out in international comparison.

Budapest's New South Circle Railway Highly Overpriced, Experts Say
Budapest's New South Circle Railway Highly Overpriced, Experts Say

According to estimations, such a job would normally cost only a tenth of Orbán-ally Lőrinc Mészáros’s winning bid.Continue reading

Therefore, two opposition MPs (namely Párbeszéd’s Olivió Kocsis-Cake and DK’s Gergely Arató) turned to the government, demanding answers about the pricing.

State secretary Orbán: “experts’ calculations superficial”

In response, state secretary Balázs Orbán insisted that overpricing was out of question. He labeled the project the “biggest railway development in Hungary in more than 100 years,” explaining that it would triple the capacity of the railway line on Budapest’s suburban railway’s main section.

In his view, the calculations of the “experts” published in the aforementioned outlet are “superficial” and are “ignoring many aspects of the project.”

Not only will the tracks be extended within the urban environment, but existing tracks and structures will also be rebuilt. In total, some seven new railway bridges will be built along the railway, together with more than 5 km of new reinforced concrete abutments, he also claimed.

The project additionally includes utilities, road and bridgehead works required for the bridges, and two new barrier-free stops along the line.

In addition, 35,000 square meters of noise barriers will be built and at least 2,000 windows in the surrounding residential buildings will be replaced in order to improve insulation, he said. The development will provide the opportunity to create new direct links between our rural cities and will also help to reduce road traffic congestion, making Budapest a cleaner, greener city, he concluded.

Népszava: Mészáros won bid without any other serious contender

Meanwhile, Népszava writes that Lőrinc Mészáros’ V-Híd won the project without any other major, serious contender. Only one other company eventually challenged the prime minister’s fast-emerging friend, according to the left-wing daily, but they proposed a slightly worse offer.

Two Companies Involved in Suspicious Public Projects Dissolved
Two Companies Involved in Suspicious Public Projects Dissolved

The first one is the PM's son-in-law former company, Elios, which had been involved in a streetlamp project, in which the European Anti-Fraud Office smelled corruption.Continue reading

The scale of the project is well illustrated by the fact that last year V-Híd had an income of HUF 39 billion (EUR 108.3 million), making a profit of HUF 8 billion (EUR 22.2 million), meaning that the bid of this project is equivalent to nine years of their income.

featured image: Balázs Orbán in the Parliament; via Noémi Bruzák/MTI