According to the Minister heading the Prime Minister’s Office, the 2019 budget adopted by Parliament last week serves wage increases and economic growth, and also contains tax reductions.
At his press conference held on Tuesday in Budapest, Gergely Gulyás said that safe growth is the key to the country’s long-term success. The goal is for the Visegrád region to grow twice as fast as the EU average. This goal is served by the 2019 budget, too, which is a budget of safe growth, he stated.
He added that the budget rests on stable foundations, but there are international risks, and therefore the reserve amounting to some HUF 360 billion is higher than ever before. The government will only use these reserve funds for development purposes next year if they conclude that the country’s fiscal balance is guaranteed and international risks do not exert a negative impact, he laid down. Among these risks he listed the general indebtedness of countries of the Eurozone, the intensifying trade conflict with the United States, and the war and security situation in Ukraine.
Mr Gulyás informed the press that next year the social contribution tax will be reduced from 19.5 per cent to 17.5 per cent, while the tax benefits of families with two children will increase from HUF 10,000 to HUF 20,000 per child.
He highlighted that today in Hungary the average pre-tax wage amounts to HUF 327,000. He added that in 2010 the average wage was HUF 202,000, meaning that in eight years it has increased by 65 per cent which he believes is a fine achievement.
In summary he said that in the long run they would like Hungary’s fiscal policy to be characterised by a balanced, stable and conservative budget and compliance with the Maastricht criteria.
In answer to the question as to whether Parliament will deal with the regulation of the cafeteria benefit system in the autumn, the Minister said that the government regards the new regulations regarding the cafeteria system adopted last week as final.
He also said that as of 1 January 2019 the pay of civil servants will increase. Primarily the pay of the central personnel of ministries will increase, he continued, but it is to be hoped that this pay rise scheme could be extended to a wider range of workers. He stressed that at this point in time there are only plans, the government has not yet decided. In his view, at present everyone is looking for statutory loopholes in order to be able to hire adequate work force, but this is not a good solution. He added that the right solution would be if managers were given more freedom in determining the salaries of staff members, and therefore they should change over to a system of pay pool management. According to plans, the available pay pool may increase by as much as 20 per cent, he observed. In answer to a question concerning performance evaluation, Mr Gulyás said they have yet to determine whether they will introduce such a feature because it is very difficult to implement.
The Minister offered the government’s condolences to the relatives of the Greek fire victims. He said – in accordance with a Greek request – the Ministry of Interior and the disaster management authority are looking into the possibility of providing prompt and immediate assistance for Greece. He expressed hope that with united European help the Greek fires can be stopped within the shortest possible time.
The Minister said in answer to a question concerning a topic on culture that he himself is observing the cultural struggle that has started in Hungary in a literary sense, but he resists the temptation of evaluating contemporary literature on the basis of political categories. He said he shares the view that in culture quality is extremely important, and he also accepts that quality cannot be entirely separated from convictions regarding important issues, but these should not be construed as direct political convictions.
He stressed that he does not agree with recent articles attacking Gergely Prőhle, Director General of the Petőfi Literary Museum (PIM). He does not agree with them because while some elements of the Director General’s work can be subject to criticism, on the whole he believes that Gergely Prőhle is an excellent director general, he said, indicating that he likes the Director General also personally.
He also stressed that “cultural expansion can only take place on a quality basis”.
Mr Gulyás mentioned Anna Jókai as one of his favourite contemporary writers, and described the novel Revised Edition by Péter Esterházy as brilliant.
The Minister was queried about “Lajos Simicska’s departure” and the plans of Zsolt Nyerges, the new owner of his media empire. Mr Gulyás said – stating his personal opinion – that he is not familiar with Zsolt Nyerges’s plans, but he is infuriated by what HírTV and the daily Magyar Nemzet have been reduced to, and for reasons other than political affiliation.
Mr Gulyás was asked regarding the fact that, according to the news portal Index, a large number of applicants with ties to Fidesz have been awarded grants in EU calls for proposals for the development of accommodation facilities in the countryside. He said that calls for proposals must apply to everyone under the same conditions, no one can be unduly favoured or disfavoured just because they worked or work as Members of Parliament.
He also said that, as expected, at its next Wednesday meeting the government will deal with the problem that the winter household utility charge reduction of HUF 12,000 did not reach those, for instance, who use wood as fuel.
If necessary, they will propose a legislative amendment, he said in answer to a question raising the concern that as of the end of 2018 the overtime payments of members of the armed forces will terminate. He highlighted that they laid down in a law adopted in 2015 that any overtime pay or leave will be available until the end of 2018. They have since introduced career models based on which salaries will increase by 50 per cent in total, he pointed out. He observed that there may be areas in which this problem will have to be addressed.
Mr Gulyás also said that the excess EU funding of HUF 11 billion provided for the refurbishment of metro line 3 will not result in the withdrawal of funds from other programmes.