Can the EU link rule of law with EU funds? Yes, says Hungarian former EU Commissioner László Andor

Can the EU link rule of law with EU funds? Yes, says Hungarian former EU Commissioner László Andor

With the recent crackdown on civil society and educational spaces in Hungary, the European Union has been in a very uncomfortable situation, watching the values it upholds being destroyed from within. When it triggered Article 7 on 12 September against Hungary, the European Parliament clearly sided with civil society, showing its firm support for the fundamental rights attacked by this country and other Member States like Poland. However, this punitive approach requires unanimity in the Council, which might not be achieved due to the support that Orban is likely to get from Warsaw, which can veto the decision.

In response to the threat to European values and human rights  from Member States like Hungary and Poland , European commissioners, experts and Heads of State have put forward the idea of linking EU funds to compliance with the rule of law in the next Multiannual Financial Framework (MFF), along with the delivery of European structural funds and cohesion funds.  In our study visit to Budapest in Hungary to examine the state of play for civil society and NGOs, we met with Hungarian former Commissioner László Andor in the Aurora Community centre to discuss how the EU can enforce the rule of law through legal mechanisms.

László Andor served as EU Commissioner for Employment, Social Affairs and Inclusion from 2010-2014, and has also worked as a former director for the European Bank for Reconstruction and Development.  Andor thinks the European Commission has the legitimacy to act within the current EU budget, in a bid to prevent waiting until the next one in 2021 and a situation in which “Orban can still win another election using EU funds to feed his clientele, friends and family.” The European Anti-Fraud Office (OLAF) has put forward 40 cases regarding Hungary’s misuse of EU funds, yet the government has only prosecuted a few cases.

To safeguard EU values, the Commission has introduced a non-binding ‘Framework to strengthen the rule of law’ and included in its next MFF proposal a new rule of law mechanism that aims to ensure the proper functioning of the judiciary and the prevention and sanctioning of fraud and corruption.

When Hungary maintained its refusal to partake in enhanced cooperation Andor made it a priority to ensure that the EU Public Prosecutor’s Office (EPPO) becomes “an obligation and not an option” for Member States,   and to create a European-wide independent body whose main purpose is to investigate the misuse of EU funds and cross-border tax fraud.  Another priority for Andor is the possibility to transform the shared management of EU funds, an option which has been discussed at length these past weeks with the recent EP resolution on Hungary.

However, the conditionality of EU funds has become controversial in V4 countries, as “Orban will have limited leverage when negotiating the next MFF due to the economic and financial development linked to cohesion funds being extremely important” explains László Andor. In the 2014-2020 MFF, Hungary was allocated 25 billion euros as part of the structural and investment funds (ESIF), making the country the third biggest recipient in Eastern Europe. The Commission has proposed steep cuts in its EU executive’s detailed plan.

Referring to the Commission’s intervention during the Greek Financial crisis through its July 2011 Task Force, in which the Commission set a precedent for intervening in (re)programming measures for an accelerated take-up of EU funds, László Andor emphasised the need for the Commission to take legislative action to transform the shared management of the cohesion funds. In parallel with this proposal, NGOs and civil society should also be involved to avoid further polarising the situation.

At SOLIDAR Foundation, we support proposals for linking rule of law to accessing EU funds, which can prevent Member States further breaching fundamental and human rights. Furthermore, we will continue to encourage and support civil society organisations and NGOs that promote European values and citizenship education.

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