6 March 2018, Budapest
Good morning, Ladies and Gentlemen,
There isn’t much meat left on the bone: all the important things have essentially already been said. It’s not the most rewarding job to speak in such a situation – particularly if the audience is as tired as you are now. But perhaps it’s not so bad, because then I can say a few words about politics. First of all, I wish to thank my colleagues, the Governor of the Central Bank and the Minister for Economy for their speeches, and I also wish to thank Mr. László Parragh, the President of the Chamber, our partner, for his speech. When we think about the management and governance of the country, or about policy, our approach is that there are several models to choose from. My personal belief, and that of the Government, is that politics is an area in which you can never be clever enough on your own: you always have to find the people who are able to take full responsibility for the management of one area or another. In the past few years Hungary has been a lucky country in this respect, because in a number of key areas which are crucial for the future we have managed to find ministers who have each been able to exercise full authority in taking charge of an area that is crucial for the Hungarian nation. They have led their departments autonomously and – although they might consider this to be a slight exaggeration – I can safely say that they are not just ministers but true statesmen and women. We’re a lucky country because György Matolcsy heads the Central Bank: the institution that guarantees the value of our money has a patriotic-minded governor with a thorough understanding of the international scene. We’re lucky because in recent years Mihály Varga has proven – as you’ll have ascertained from his speech earlier – that he’s able to keep a firm grasp on Hungary’s economic policy and guide it forward. We’re lucky because we have an interior minister who started out as a policeman on the beat, and made it all the way to national police chief. So he knows precisely what security means: he didn’t learn the meaning of the word from books, and doesn’t think, for instance, that policing the border should be done using flowers and cuddly toys. It requires completely different means. And we can also be pleased that we found a “young Titan” to head the field of foreign affairs, who I’m convinced will for a long time to come be able to represent Hungary with a Hungarian heart, a European outlook and a cool head. And you will see that it’s significant that in Katalin Novák we have found, I think, the lady who in the years ahead can coordinate the government policy needed for a demographic turnaround – and perhaps even oversee that turnaround.
This may already be enough to make you feel that you haven’t come here in vain. I would like to reflect, however, on a couple of things that were mentioned a little earlier. The first is the issue of an “election budget”. There will be no election budget. The Hungarian parliament has adopted Hungary’s official budget for 2018; this is a law, and we shall adhere to it. It sets a budget deficit of 2.4 per cent. In the next few weeks the Government has some room for manoeuvre within this figure, but only within the agreed budget. I will never allow Hungary to be taken back, to slide back to where it was under the Socialists, when the primitive idea prevailed that before an election the people must be bought off, and that even dismantling, overturning and devastating the budget is not too high a price to pay in the process of achieving this. You cannot do this to a country, because afterwards we will all jointly pay an enormous price. This is why there will not be an election budget. Come what may, the deficit will remain below 3 per cent, but in my opinion the most likely scenario is that by the end of 2018 you’ll see that we’ve kept to the 2.4 per cent deficit target laid down in the law.
Ladies and Gentlemen,
Everyone has summed up events during the period between 2010 and 2018. And indeed this has been an important period in the history of the Hungarian economy – and not only because we’ve lived through it, and we ourselves have grown older by eight years. It’s also important because, as you’ve seen from the charts, and as I think you’ve also experienced in life in general, the Hungarian economy has fundamentally changed. After a period of drift, of searching for the right path and of being forced into a continuous balancing act, since 2010 the Hungarian economy has been set on a new course – through, as you’ve seen, a turnaround, growth and all the effort required for that. There is a Hungarian model, about which I would like to say a few words a little later. I’ll only briefly sum up how all this happened, which is a story you all know very well. In 2010 we felt that Hungary was in danger, because after eight years of left-wing governance, the civic government that was being formed at that time had to take charge of a financially vulnerable country that was in the process of disintegrating. We had to simultaneously put the Hungarian economy back on its feet, restore the prestige of work, create financial stability, and fight for the country’s financial independence – because that is something which is never handed over without a struggle. What made matters worse was that prior to 2010 not only had the country itself fallen deep in debt, but local governments and Hungarian families had also found themselves in a debt trap – or were driven into one, as this is perhaps a matter of political interpretation. In 2010 we learnt that if the task at hand is an impossible one, for the most part we can only rely on ourselves. On the night of the 2010 elections, who would have thought that we would soon be sending the International Monetary Fund packing? Few then thought that within barely five years, way before the due date, we would have repaid to the last cent the IMF and EU loans – which were referred to as a rescue package, but which in reality were financial shackles. But we did this. It’s also worth recalling how in 2010 many people ridiculed us when we said that one million new jobs must be created within a period of ten years. Today there are 736,000 more jobs in the Hungarian economy than there were in 2010, and we have brought unemployment down from a level of over 12 per cent to 3.8 per cent; full employment is within reach. The European frontrunners in the contest to cut unemployment look like this: the Czech Republic on 2.4 per cent; Malta on 3.5 per cent; Germany on 3.6 per cent; and Hungary on 3.8 per cent. If I’m permitted to take responsibility for it, I expect the next government and leaders in the economy to help Hungary move right up behind the Czech Republic: we must overtake both Germany and Malta; we need an unemployment level which is lower than in those countries.
When in 2010 we said that we were going to create fiscal balance, reduce taxes on employment and support Hungarian families, everyone declared that although these are noble aspirations, they are impossible to achieve simultaneously. But as it turned out it was possible, and this drew attention to the fact that economic policy is not just an intellectual issue – although it is undoubtedly that too. It doesn’t hurt if the Government includes a good many people who are well-versed in economic policy, but it’s fundamentally a question of political stability, and the capacity to act and to make decisions. An economic policy, a good economic policy, requires more than intellect: it also requires stability, strength, and the ability to take action and make decisions. In the period between our accession to the European Union and 2010, the budget deficit had never been under 3 per cent and, as you also saw on the charts, we were therefore subjected to the excessive deficit procedure. I would remind you that there was one year in which the budget deficit was more than nine per cent. Between 2002 and 2010 there was not a single year in which government debt fell: it grew continuously. On the whole taxes didn’t decrease, but increased significantly, and we only managed to keep our heads above water by resorting to all kinds of tricks: as the classics tell us, thousands upon thousands of tricks, the details of which not everyone needs to know. What I can tell you, honourable officials of the Chamber, is that the budget deficit has now been below 3 per cent for six straight years. In Brussels they are playing tricks at our expense. They keep including elements in the budget deficit that do not belong there. Most recently they included Eximbank – something that was totally unjustified and is clear evidence of double standards. Yet despite all the double-dealing Brussels is subjecting us to, our government debt is still falling, year after year. I will need to check the figures against the data from the Governor of the Central Bank, but according to my calculations in 2009 interest payments amounted to 4.5 per cent of the gross domestic product, while by 2017 they were being steadily kept below 3 per cent. This 1.5 per cent difference means that our interest payment obligations are 450 billion forints less than earlier. A major amount for the support of families.
Our Western partners generally fail to comprehend how we can afford to finance this, as in Hungary we have measures and policies of a kind that cannot be afforded in Western European countries which are much richer than us. We have free meals for children, funding for school textbooks, a family tax allowance – and meanwhile the family allowance and home creation support have also remained in place. The solution is as follows. Let’s take a look at 2017: the multinationals and banks contributed 670 billion forints in the form of special taxes, while we paid out 765 billion forints for family support. So, speaking politically, I have to say that we are making the multinationals and the banks pay for the demographic turnaround and the Hungarian family support system. Additionally, we are also redirecting here some of the budgetary funds released as a consequence of reduced interest obligations. This is why I believe that in Hungary we have the possibility to intensively finance the demographic turnaround that György Matolcsy spoke about; and we must not resign ourselves to the sociological and philosophical reasoning which states that in the modern world it is impossible to reach a point at which parents are raising at least two children in their families. In our view, this is indeed achievable. This decision is of course up to the people themselves, to the ladies and gentlemen – and in particular the ladies; but we can clearly influence their decisions if we show respect, and if we provide them with support and assistance. So from its own resources Hungary is capable of accomplishing the demographic turnaround that is the foundation not only of all our continued success, but also of our continued biological survival.
Ladies and Gentlemen,
In 2010 the number of children receiving free meals was 92,000; by 2017 that figure was half a million. Today 85 per cent of pupils in Hungary receive their school textbook packs for free. Since 2010 the capacity of preschool centres has increased by ten thousand, while that of nurseries has increased by twelve thousand. I don’t know if you remember the word “austerity”. In 2009, one month’s pension and one month’s wages were taken away from pensioners and people in employment. And just so that everyone can consider their decision in April appropriately, I would also like to remind you that a tax on property was also introduced. In 2010 Hungarian economists and the “gurus” of government policy still though it inconceivable that one could pursue successful economic policy without austerity. With his actions as a government minister, which began in 2010, György Matolcsy proved all that to be mistaken. He succeeded, and we’re grateful for that.
How was this possible? If one achieves some result, it is important to understand precisely how much of it was down to luck and how much to knowledge, what were our opponent’s weaknesses and what constituted the success. When I tried to understand how between 2010 and 2018 we were able to achieve the results which were mentioned by those who spoke before me, I thought about what led to our success from an economic policy perspective, and in relation to this I separated the things that we didn’t do from things that we did do.
What didn’t we do? The first thing we didn’t do was rely on the IMF. The second was that we didn’t seek foreign models. We studied them and understood them, but we didn’t search for a foreign model which we could then follow; instead we believed that the social and economic model best suited to our own character must be created from Hungary’s specific characteristics. And the third important thing we didn’t do was that we didn’t cave in to threats of any kind. International politics is becoming increasingly coarse, as you can see for yourselves. I’ve been in this profession for quite a long time, and I’ve observed international politics from close range since 1990, when I first became a Member of Parliament. I have to say that these thirty years have followed a trend of increasing coarseness. Increasingly direct means are also employed in domestic politics, but this is particularly true in international politics, with countries that are much larger than us being able to achieve what they want at the expense of others. And if we yield to these threats – for instance by continually repeating the fact that we are a small country – then Hungary will never have an economic policy which is good for us. It will always be good for somebody else, someone who used threats to persuade us to do something that we never should have agreed to in the first place. So these are the things we didn’t do.
What did we do? The first and most important thing that we can even be proud of is that we managed to bring about an agreement. I have followed Hungarian domestic politics, and not just foreign politics, since 1990, and everyone has always said that we need an agreement on taxes, on reductions in payroll taxes, and on wages. There are also international examples of this, and in this context Spain’s Moncloa Pact is mentioned particularly frequently. But while everyone talked about it, no one was able to pull it off. I believe it is a major achievement, in which you have played the leading role, that in Hungary we succeeded in concluding a long-term agreement on tax, wage and payroll tax issues. With regard to this we have all made guarantees, and to date we have duly honoured all of these commitments. I believe that an important prerequisite for the success we achieved is that, of all the things we have done, we highlight above all the culture and fact of the agreement itself. Thanks to this, since 2010 the minimum wage has increased by 90 per cent, the guaranteed wage minimum for skilled workers has doubled, pay for trained healthcare employees and specialists has also doubled, and the salaries of teachers, police officers and soldiers have risen by 50 per cent.
The second thing we did was rely on Hungarian intellectual capital in the field of economic policy. It’s important for a country to have the courage to state that the thorough understanding and effective coordination of economic policy is an area in which it has enough intellectual capacity on its own. We will not be able to follow our own path if we nurse an inferiority complex, if we always see others as more clever than us, and if we don’t even give ourselves a chance to prove our intellectual competitiveness. Naturally, the Government knows that its own intellectual competitiveness is not guaranteed by the Government itself. While that may be a good thing, and I’d be happy to see something like this at some point, the fact is that in economic policy this is not the case. There’s a great deal of knowledge accumulated within the Government. Minister Varga, who is particularly keen to ensure that we only make decisions after due consultation, rakes together a large amount of knowledge from outside the Government. A truly profound understanding of the economy can be found above all in the Central Bank, where the economy is observed from the angle of money; and I would rank the Banking Association alongside the Central Bank; while in the Chamber there is a profound understanding of the real economy. It is the Minister’s task to gather knowledge of the real economy from the Chamber and monetary and financial knowledge from banks and the Central Bank, and to stir this and meld this knowledge into a functioning economic policy. But a precondition of this is that the Minister believes in two things: the first is that the Governor of Hungary’s Central Bank is not inferior to the central bank governors of other countries; and the second is that the people in the Hungarian Chamber are no less intelligent than people in Europe’s other chambers. And he must then also believe that he is at least as well-equipped to combine these pieces of economic information as are his colleagues in other governments across Europe. If we don’t believe these things, if we have no faith in them, if we have no self-confidence, we won’t succeed. Then there will be no Hungarian model, there will be no path of our own, there will be no economic policy that serves Hungary’s interests. And the third thing we did was that we remembered the fundamental principle which states that the basis of a successful economic policy is political stability. Good economic policy instruments, ideas, concepts and visions are undoubtedly required, and we also heard some long-term visions from the Governor of the Central Bank a little earlier, but believe me, nothing can be achieved with these if there is no political stability in a country.
Take a look around Europe. Political stability is as rare as hen’s teeth. We wish our Italian friends the best of luck: the election was last week, but we can see that things won’t be so simple. And who would have thought that in Germany we’d see a September election which would result in the formation of a government only in mid-March? And I could mention many more examples from around Europe. Political stability is extremely important. But political stability is something that we must correctly understand. What does it mean? Political stability doesn’t mean that we have a strong government. Political stability doesn’t mean that we have a strong majority in Parliament. This is only the form, the outward appearance of political stability. The essence of political stability lies in the fact that the citizens of a country feel that they are receiving what they see to be their fair share. This is what a parliamentary majority and a strong government can be built on, but its starting point is that everyone in Hungary – because after all we are talking about our homeland – feel that they are receiving what they see as their fair share. Of course, what’s fair and what isn’t can only be determined in debate, but at the end of the day this is the goal we must set for ourselves.
What does fairness mean in my view, and what am I trying to provide to every citizen of Hungary? The first thing included in fairness is that everyone has the opportunity to work. This is not simply an economic issue; every Hungarian feeling that they can work if they want to is the primary precondition of political stability. They may not find their dream job straight away, but neither will they or their families find themselves in a situation in which someone else needs to provide for them. The second thing that I believe forms part of fairness is that families must be supported. One can live in many ways, with or without children. This is a private matter, a private decision. But the Government must make it clear that, as far as it is concerned, it is not at all irrelevant what decision people make when exercising their freedom to choose. This is why it is fair for families to demand recognition from the Government that their decision to have children is a valuable one, which must be rewarded and supported in some way. Perhaps I’ve already spoken earlier about this at length. And the third thing constituting fairness – and which everyone in the country must be given – is respect. If everyone has work, if families feel that they are being supported and everyone is given the respect they deserve, then there is political stability in a country. This is what creates a parliamentary majority, and this is what a strong government can be built upon. So the essence of political stability does not lie in the strength of the Government, but in the source of that strength.
Ladies and Gentlemen,
As regards the future, on earlier occasions I had the opportunity to tell you, and I will just repeat now that I believe in simple things: in work, in the family and in homeland. And this is why I won’t accept the temptation presented by György Matolcsy’s speech. That temptation is that we go on an adventure into the realm of all kinds of complicated matters to try and understand – how did he put it? To understand how to negotiate the bend which the European economy, the global economy – and with it Hungary – will take, or will be forced to take. I certainly agree with him: a bend is a dangerous part of a journey, a dangerous section; because if you are careless when entering it you’ll lose control. This means that selecting the right speed and good timing are especially important. But I still say that at the end of the day the foundations of the answers that must be given to the extremely complex questions of sustainable growth and convergence are work, family and homeland. When looking for solutions, if we lose sight of any one of these three we will give the wrong answer.
So I can only recommend a government for Hungary that believes in work, family and homeland, and which seeks to answer every complex economic question by standing on these foundations. This means that we believe in a work-based economy. We firmly believe that the backbone of the country and the nation is formed by families that raise children, and we believe that the Hungarians only have a future if they can remain Hungarian. If I wanted to say this in more sophisticated terms, then I would do so by talking about a Hungarian model.
The Hungarian model is supported by four pillars. This is not simply a text: it is a matrix, a system of correlations. The Government must be able to relate every decision it makes to one of these four pillars. We only make decisions which can be related to one or other of the four pillars. And whichever pillar a particular decision relates to, it must not weaken the other three pillars; this is the minimum requirement, but the optimal situation is if it reinforces the other three pillars. These four pillars are competitiveness, a work-based economy, demographic policy and policy strengthening identity. We must not adopt a decision on competitiveness that goes against the ideal of full employment, or which is bad for families or weakens the Hungarian identity. And likewise we must not adopt a decision on Hungarian identity which weakens our family policy or competitiveness, or which goes against the ideal of the work-based economy. In the past few years we have fitted all of our decisions into this system. As far as I can see it has worked, and accordingly it makes sense to continue to place and interpret our economic policy decisions within this matrix.
Ladies and Gentlemen,
Overall, what I wanted to tell you today is that the Hungarian economy and Hungary itself are performing better – to use a political catchphrase – because we haven’t allowed anyone to take the freedom of decision-making away from us. And here I don’t only mean primary political decisions. There’s something here that concerns you in particular: the issue of the freedom of policymaking on tax issues. From prime ministerial summit to prime ministerial summit in the European Union we are under enormous pressure from certain countries – there’s no need now to mention them by name – which keep putting forward proposals for a unified European tax system. As far as I can see, they’re seeking to compensate for their competitive disadvantage by forcing a disadvantageous tax system onto us that is very similar to theirs. And in the face of these attempts we must protect the political freedom to shape our own taxation system. We are fighting this battle in the European Union month after month, and I fight this battle myself – sometimes loudly, sometimes more quietly. When you hear something like “the social pillar” and the like, you should read it through thoroughly, and you will see that they are in fact joint European proposals on payroll taxes and taxation which, in the forms we are currently aware of, are clearly contrary to your interests and those of Hungary. In other words, what I’m saying is that if the decision on important national issues doesn’t lie with us, but with Brussels or the IMF, then we’ll be in trouble.
Naturally at this point we must ask how much these institutions, and in particular the European Union, contribute to our achievements. The political forces that support foreign intervention and influence regularly use the following rhetoric: the funding we receive from the European Union is the precondition for the success of the Hungarian economy. This is not the case. It’s a good thing that such funding exists, but there was a figure mentioned earlier, and while this was not the essence of the Governor of the Central Bank’s speech when he spoke about the difference between GDP and GNI, the fact is that the funding received from the European Union more or less covers this difference. Or to put it in simpler terms: in essence they are making money out of us. They are also the ones who primarily make money from EU funding; we also benefit, the system isn’t bad for us, but we are not its primary beneficiaries. We must understand that by giving us money they are financing themselves. This is a wise and clever system. All we have the opportunity to do is find the gaps, the way to use funding which will enable us – and not just them – to make money on what we call “EU funds”. Furthermore, I’d like to draw everyone’s attention to the fact that the value of the Hungarian economy’s annual production is around 130 billion euros, to give you this figure in euros; and EU funding amounts to four – 4 billion euros – annually. That’s a ratio of 130 to 4. Undoubtedly, without that four billion we would have to create a different kind of fiscal policy, and we would have to put different figures in the economic development columns. But there is a successful economic policy and fiscal arrangement that could also make Hungary successful without those four billion euros every year. But today those aren’t the rules according to which we’re playing the European game, and we need to find room for that four billion euros. But my guiding principle is that it’s not money that we need from Europe. It’s not the Europeans’ money that we need: it’s their markets. If we have access to their markets, we can make our own money, and so from the perspective of Hungarian interests the essence of the European Union isn’t in EU funding, but in access to European Union markets that are several times larger than the Hungarian market. This is why we must stay in the European Union; but when we are there we must tread carefully.
Ladies and Gentlemen,
Now I would like to say a few words about a challenge that has emerged on the horizon of Europe and European politics, and which has completely redrawn the balance of power in Europe. We must incorporate this challenge into our thinking on economic policy. This phenomenon is one which has changed European politics; we call it immigration or migration. This is not just a political issue, but also an acute economic and economic policy issue. In the next ten to fifteen years the stability of governments throughout the whole of Europe will depend on what responses they can provide to this challenge. Will citizens receive what they believe to be fair? For instance, if they don’t want migrants, they should not receive migrants. If you look at the results of the Italian election, which was held on Sunday, and you don’t look at it in terms of parties, but see the dividing line as immigration – which it was – then you will see that one quarter of the active electorate voted in favour of immigration and three quarters voted against immigration. To put it even more accurately: one quarter of voters supported pro-immigration parties and three quarters supported anti-immigration parties. And over the next ten to fifteen years this will be the case throughout Europe. This is a situation that governments and those in charge of economic policy will have to incorporate into their way of thinking. In Hungary’s case this means that migration is a determining factor for the Hungarian economy’s development opportunities. If we become an immigrant country there will be regression, decline and stagnation. If we are able to keep ourselves in the state that we are in today – meaning that we do not become an immigrant country – then Hungary will progress.
What does this mean in figures – in your language, Ladies and Gentlemen? I shall quote Mr. Markus Söder, who within a matter of moments will be Bavaria’s new Minister-President, as yesterday or the day before yesterday the incumbent Minister-President became the German federal government’s Interior Minister. So we have a new Minister-President of Bavaria, and his name is Markus Söder. He gave a speech on Ash Wednesday, in which he said the following, and I quote: “The Free State of Bavaria spends more money annually on asylum, immigration and integration than the combined state budget for the economy, the environment and health care”. This is the degree of seriousness with which we must face the issues of immigration and migration. This is the situation in Bavaria today. I ask all Hungarian entrepreneurs to consider what this financial burden would mean for Hungary – particularly as the period when migrants entered Hungary and were then able to move on to Austria and Germany is now at an end: the Austrians have secured their borders, and the Germans are also securing their borders. Those who are sent here or who we take in will all stay here, and will all be our financial burden. We are a cul-de-sac – or like a sock. Those who are sent here will stay here, and we will have to take care of them and pay the costs. At the European Union summit due to be held on 23 March we will touch on the European Union’s proposal for new migrant regulation, while at the June summit we will be negotiating it in full. What does this mean? It includes a method of calculation for determining what they call a fair number of migrants that every country will be required to accept. At this point in time, for Hungary this would mean more than ten thousand people. According to the OECD’s calculations, and in accordance with EU regulations, each migrant costs four and a half million forints every year. As the EU proposal also includes the right to family reunification, we must immediately multiply this by two: so we’re not talking about ten thousand people, but twenty thousand. For ten thousand people this would mean 45 billion forints annually, and for twenty thousand it would be 90 billion forints. And if there’s another surge of migrants like the one we experienced in 2015 – and that is a realistic possibility, as you too can see Africa and how it’s shifting and is incapable of protecting its borders – then instead of ten or twenty thousand people we’ll have to reckon with tens of thousands of people, or even hundreds of thousands. For one hundred thousand people this figure would be 450 billion forints a year. In that event we could wave goodbye to everything we’ve just spoken about: quite simply, the resources of Hungary’s economic policy would not be enough to achieve development.
Ladies and Gentlemen,
But what opportunities will we have if we succeed in protecting ourselves? I’d like to say a few words about what opportunities will be realistically available to Hungary. In election campaigns politicians usually make promises, but as you know full well this isn’t in our nature, this is something we aren’t good at. If we do say something, we prefer to use the phrase “commit to”. Furthermore, we’ve been in government for eight years, and we can safely point to the decisions we have made so far, and perhaps what we’ve managed to achieve to date will lend credibility to what we want to and are able to achieve in the future. Nevertheless, we should say something about what Hungary could be capable of over the next four years.
In my view, in order for us to be capable of anything, three preconditions must be met: we must not let a single migrant into Hungary; we must protect our defence system, the border security fence; and we must make Brussels pay for the costs of the latter – or at least for half of the costs. This is 140 billion forints, which we’re entitled to. And we must exclude from Hungary everyone who is engaged in the organisation of immigration, because quite simply this presents a national security risk to Hungary. I would also like to tell you that while naturally people make bad decisions, we have no reason to hate anyone, and we mustn’t even hate those who promote or make decisions that are harmful for us. We are a Christian government, and we are able to make a distinction between a person and their deeds. We do not hate anyone and we do not despise anyone, but we utterly despise certain actions: actions that we cannot accept. So our campaign and our actions in the interests of Hungary are not based on hatred, but on making a distinction between a human being, a person and their actions. But we must stand up clearly and unrelentingly against those actions, and we must neutralise or prevent those actions.
It is similarly important that on such difficult issues our conscience should be clear. We must calmly state that migrants are not our enemies. Among them are a great many unfortunate people, who are indeed victims. they are victims of people smugglers, victims of bad governments in their home countries, victims of poor international policies, and victims of some irresponsible politicians in the European Union who create the impression that they are welcome here. So we do have compassion; but no amount of compassion could justify destroying our own country, our own lives, our own families and our own homeland. We should therefore follow the morally legitimate principle that the problems should not be brought here, but help must be taken over there. Only yesterday we inaugurated a school in Kurdistan, we’re building a hospital, we’re building homes, and we support church communities that encourage the return of people to the territories of countries in distress, so that they can take back those who left for Europe. If all this succeeds – meaning we don’t let in migrants, we protect the fence and exclude everyone engaged in the organisation of immigration – then there is a realistic chance, I see a realistic chance, of us being able to achieve 4 per cent economic growth in Hungary every year. I’d like to make it clear that only if people have a suitable level of trust, then in future I will be able to work together with a Minister for Economy who agrees to assure 4 per cent annual economic growth not only for two years, but for the whole of the next four years. We will have to conduct some serious negotiations about this following the election. We need an economic administration that undertakes to ensure that we reach full employment by 2022. So we should at least catch up with the Czechs in terms of reducing unemployment. I believe that we’ll also be able to ensure that the minimum wage increases every year, and this is something that we will do. We have concluded an agreement on this, and I think that the terms of that agreement can be seen. There are proposals that envisage accelerating the pay rises laid down in the agreement, and we are certainly not ruling out further negotiations on that, but any adjustments made must be proportionate to performance – meaning that employers, trade unions and the Government will have to agree on this together in the future also.
If there is 4 per cent economic growth annually, there will be pension rises in Hungary every year. If there is 4 per cent economic growth – and there will be – we will be able to pay a pension premium every year. With economic growth of 4 per cent we will be able to keep our word – or to be more precise, the promise that I made to ladies – to continue to enable women to retire after forty years in employment. We must protect the “Women 40” programme at all costs. This also ties in with my thoughts on political stability: women believe it is fair if they can retire after forty years in employment, and I support this idea. And I believe that the tax allowance due to families can also be increased once again in accordance with the matrix of the Hungarian model I just described. And I believe, once again in agreement with you, that between 2018 and 2022 we will be able to reduce the burden of payroll taxes every year. What Mr. Varga outlined on this subject is something that I myself can commit to, and I believe it is a realistic scenario. If you listened to his explanation of the numbers, what he said is that by the end of the term we can reach a point at which payroll taxes in Hungary will be the lowest in the region. If you look at the current figures and analyse the data of recent years, this is quite a commitment. And indeed I expect the Hungarian government’s next economic administration to ensure that by the end of the upcoming term payroll taxes, which are currently still substantially higher, should be somewhat lower than those of our regional competitors. I am also certain that as we have launched the Modern Cities Programme, developed its details and begun its implementation, in 2018 we must also launch the Modern Villages Programme. Village life is something that must be protected and is an advantage, and we don’t want everyone in Hungary to move to cities. This requires the strengthening of village life, and a significant improvement in the quality of life there. So we will have a Modern Villages Programme, which naturally will focus on the improvement of living conditions.
And, after all these down-to-earth things, so that I have something to say that can be interpreted in the macroeconomic – or let’s say “Matolcsy” – dimension, we must build up Central Europe. You may have worked out the figures yourselves from the speeches so far. Central Europe is the European Union’s economic engine, its locomotive. This region has the highest growth, and it will continue to have the highest level of growth in the period ahead; but during the period of Soviet occupation this region was developed so that the countries within it are only linked in an East-West direction. Therefore we all know and feel that Central Europe exists: we know that it exists from reading literature, from watching films and from listening to music. But from an economic perspective, if we ask whether Central Europe exists in an economic sense, then we tend to see instead Central European countries and not a Central European economic region. The reason for this is that the North-South links that could forge the Central European countries into an economic region do not yet exist. We’ve taken some important steps in this direction, and we will continue to do so. I see the high-speed railway system as important, and the Budapest-Belgrade line will be a new North-South link in the system. I believe it is important to successfully conclude talks on construction of a Budapest-Warsaw high-speed railway line, which would mean that we could reduce travel time from the current twelve hours to around four hours. With regard to the road network… Sorry, we’re also planning a Budapest-Kolozsvár/Cluj line, and we are engaged in negotiations with the Romanians, who would like a Budapest-Kolozsvár/Cluj-Bucharest high-speed railway line. Naturally the first section of this line is closer to our hearts, but we have no objections to it running all the way to Bucharest, and in fact we would be happy to take part in its construction, should the need emerge. And as regards the road network, come what may I think that during the upcoming term it is crucial for the motorway to extend as far as Košice/Kassa. So the Miskolc-Košice/Kassa motorway, which is already under construction, but on which progress is extremely slow, must now finally be completed. It’s likewise important that we should also reach the Croatian border from the Pécs area on at least one route – but preferably two. These are the tasks that fall to the Hungarian government, to the Hungarian budget and to Hungarian economic policy as part of the economic establishment of Central Europe.
Ladies and Gentlemen,
In closing, I would like us to remember that eight years ago we entered into an alliance with you. Your President also mentioned this. That alliance was forged in order to rescue the Hungarian economy, stimulate competitiveness and eliminate unemployment. I now offer you a new alliance. I believe it is important for every Hungarian businessperson for the next government’s economic policy to represent the best interests of Hungarian businesses. The Alpha and Omega of this – and this is something I have already spoken about here today – is the protection of our national independence. So I ask you to help protect Hungary, help protect a sovereign Hungarian taxation policy, and help protect governance that is independent of foreign interests and foreign influence. Whether Hungary is led by a puppet government representing foreign political and economic interests, or an independent national government, depends also on you – it depends very much on you.
Thank you for your attention.