news letter Our mobile application

Weekly newsletter

Hungarian Government, Opposition Clash Over State-Mandated Utility Tariff Cuts

Tamás Székely 2015.06.16.

Hungary’s government will make every effort to maintain its utility cuts programme, Zoltán Kovács, the government spokesman, told a press conference. Kovács reacted to press reports suggesting that the government would halt the scheme, and said that Hungary is in “intensive talks” with the European Union and “whatever may happen, the government is committed to preserving the results of the programme”. Kovács said that in February the European Union had initiated an infringement procedure against Hungary based on the commitments of the so-called third energy package. Incidentally, he added, these commitments have not been fully met by any EU Member State. However, Brussels maintains the Hungarian scheme contravenes EU competition rules.

The opposition Democratic Coalition (DK) called on the Hungarian government to release a letter the justice minister sent to the EU’s energy commissioner in connection with cuts to utility fees, the deputy leader of the left-wing party said. The minister, László Trócsányi, indicated in his letter to Miguel Arias Canete that the government is ready to make concessions to Brussels, Csaba Molnár said, citing press reports. The government is considering scrapping the scheme, which will result in rising electricity and gas prices, Molnár said, citing a report by weekly which referred to Trócsányi’s letter dated May 8. Whereas no timeframe was set, the letter’s phrasing suggests measures will be taken soon, said, adding that the justice ministry has admitted to the letter’s existence while refusing to comment on its content, citing an “ongoing confidential procedure between the Hungarian government and the European Commission”.

The leader of the opposition Socialists (MSZP) said that portal’s report raises the question as to whether or not the prime minister is planning to scrap the scheme. If such a step is indeed planned, Viktor Orbán should reveal the rate of electricity and gas price hikes, József Tóbiás told a press conference, noting that the budget does not contain any allocation for any ensuing compensation to households. But of the government’s aim is to act in the interest of utility companies, the question arises as to whether it wants to ensure market prices for a new entrants, he added.

Szilárd Németh, the ruling Fidesz representative in charge of the policy on cuts in household utility bills, said in response to the opposition claims that the Fidesz-KDNP parliamentary group fully supports the Government’s policy on cutting utility bills, which is also backed by the majority of citizens. Németh said that “Hungary has made a breach” in a system which favours international energy firms. Thus, while earlier Hungarians paid the highest gas bills and the second highest electricity bills in Europe, today they receive the second cheapest energy on the continent, he said. “We do not want to take a single step backwards in this field”, he stressed.

via, and photo: