Part I — Situation overview

On 7 August 2026, at the government briefing and in a video message, the prime minister set out item by item what the government is devoting the EU funds that have become accessible to Hungary to. The adopted action plan lists the directions of use in five annexes, in more than sixty items. According to the announcement, 600 million euros — more than 230 billion forints — goes to housing, for the creation of affordable rental homes and student hostels; in education, 54 billion forints’ worth of school investment previously carried out from the domestic budget will be accounted for from EU funds, and more than 151 billion forints goes to equalising access to digital education. Healthcare receives close to 170 billion forints, of which 24 billion is for the development of general practitioner care; a further, more than 125 billion forints’ worth of previously domestically financed healthcare and digitalisation investment is being moved into EU accounting. In transport, 42 new low-floor trainsets are replacing the 40–50-year-old vehicles of the Szentendre, Ráckeve and Csepel suburban railway lines, and 35 new double-decker multiple units are arriving for rural InterCity traffic. The Hungarian Development Bank is being strengthened with 645 billion forints to expand small and medium-sized enterprise financing, and several hundred billion goes to the modernisation of the energy system.

Two connections are worth recording for the interpretation of the news. The first is of a legal nature: the frameworks of use of the cohesion and recovery funds are fixed by operational programmes and by the partnership agreement concluded with the Commission. The question of “what we spend it on” is therefore not a matter of free governmental discretion — a modification of the direction of use requires a programme amendment procedure in which the Commission is also a decision-maker. Friday’s announcement is therefore, more precisely, the presentation of the domestic unfolding of an adopted framework, not an independent allocation decision. The second connection is the question of the yardstick: on the same day two press pieces appeared reporting that the previous government had planned to open a luxury restaurant in Brussels for 7.2 billion forints, and that it had bought foreign real estate worth several tens of billions of forints. These are documented cases of earlier spending practice — and it is precisely for that reason that they give the comparative basis against which the present use can be measured.

MIAK’s reading: the arrival of the funds is a political result, but their use is a policy risk, and the difference between the two is not made by the detail of the announcement. Listing sixty items is not yet accountability — the itemised list is about what the money is intended for, not about who receives it, for how much, and what they delivered for it. MIAK’s credibility stands or falls on its asking of the present government the same standard of accountability it would have asked of the previous one; the request is therefore not a dispute about the goals, but the requirement of traceability from the first payment onwards.

Part II — Literature foundation

Three points of support from the literature give the frame in which the risk of the 6,000-billion-forint package can be interpreted. Susan Rose-Ackerman (American jurist and economist, one of the founders of the institutional strand of corruption research) shows in her volume Corruption and Government that corruption is not primarily a moral but an incentive problem: where the state allocates a scarce advantage according to criteria other than willingness to pay, the bribe takes on a market-clearing role — and detection in itself does not help if the incentives remain. Robert Klitgaard (American economist, researcher of the organisational economics of corruption) condenses the same into a structural formula in his work Controlling Corruption: the conjunction of monopoly position and discretionary power, in the absence of accountability, produces the corrupt rent — that is, the decisive variable is not the form of ownership but the presence of competition and answerability. And the European Commission’s publication An Introduction to EU Cohesion Policy adds that third, procedural layer which is regularly lost in the Hungarian debate: the thematic concentration and the allocation principles of the cohesion funds are fixed in advance, and modification of the direction of use is a formal procedure. Read together, the three sources say this: with a large-volume package of funds that has to be drawn down quickly, the risk is determined not by the intention but by the decision structure. The detailed treatment of the literature — author by author, with quotations — can be found in the 6.4 Literature in detail section.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable measures which turn the announced plan of use into a verifiable process.

3.1 A project-level, machine-readable public-money dashboard for the whole envelope (by 31 December 2026)

The government should create a single public interface showing the entire EU funding envelope at project level: name and tax number of the beneficiary, contracted amount, amount paid out, performance deadline, the output indicator assigned to the project and its current state. The interface should also be downloadable in a machine-readable format, that is, not merely a browsable table but a downloadable dataset — so that it becomes analysable for journalists, researchers and local authorities alike. The model is the EU financial transparency system, but with domestic granularity: the EU interface reaches as far as the recipient of the support, while the Hungarian system also has to show the subcontractor level of the contractual chain above a value threshold of 500 million forints. This is the direct extension of the A1 public-money dashboard programme point to the present package of funds, and the precondition of the TE2 data-based cohesion allocation: the divergence of the allocation from need can be signalled automatically only if the data of the allocation exists in machine form at all. In Klitgaard’s structural frame (see 6.4.2) this strengthens precisely the accountability factor, without reducing discretionary power.

3.2 A public territorial allocation formula for the development funds (by the start of the 2027 payment year)

The territorial allocation should not be the result of individual bargains but of a formula announced in advance. MIAK’s proposal is that at least 60 per cent of development-purpose funds should be allocated with weighting according to the TE1 micro-regional development index — on the basis of a district-level measure formed from employment, education, healthcare, housing and digital access indicators — and that the formula, the weights and the input data should all be public. The remaining part may remain a matter of policy discretion, but then with itemised justification. The advantage of the formula is twofold: on the one hand the funds go where the indicators are worst; on the other hand, departure from a public formula will itself be a visible event, and therefore politically answerable. Among the items now announced this matters especially for the healthcare and digital education envelopes, where the inequality of access springs precisely from territorial differences — the TE4 rural public service minimum programme point carries the same logic further on the service side.

3.3 An independent review gate for high-value contracts (simultaneously with the first payment wave)

For projects with a contract value above 5 billion forints, before the conclusion of the contract there should be a mandatory public opinion by an independent professional body — the watchdog body proposed in the SZ14 programme point, strengthening the domestic control of the cohesion programmes — assessing four aspects: the actual degree of competition among bidders, the comparison of the unit price with similar domestic and EU projects, the measurability of the output indicator, and the ownership transparency of the circle of beneficiaries. The opinion should not have a veto — the decision remains the government’s — but it should be mandatorily public and mandatorily answerable. According to the Rose-Ackerman incentive logic (see 6.4.1), this is precisely the effective point of intervention: what changes the structure is not the ex-post sanction but the public counter-argument appearing at the moment of decision. This is the operative linking of the A2 public procurement transparency and the A8 cohesion accountability programme points.

The three proposals are bound together by a single principle: a package of funds brings structural change if both the rule and the result of the allocation are public, and the divergence between the two is visible. MIAK does not dispute the announced goals — the development of healthcare, education and transport is in line with the organisation’s programme. The claim is that the same sixty items bring an entirely different result with a public project list and a territorial formula than without them.

Part IV — Expected effects and risks

Dimension Expected effect Risk
Economy Predictable allocation improves investment planning and domestic supplier participation; the development bank envelope expands SME financing The rigidity of the public formula may reduce responsiveness to unexpected development needs (for example heat or water damage)
Society The territorial formula improves service access in disadvantaged districts; the rental housing and student hostel programme increases housing mobility Absorption capacity is uneven: it is precisely in the most backward districts that tender-writing and project management capacity is weakest, which may blunt the effect of the formula
Public administration The project-level dashboard leaves behind a durable public data infrastructure for the next cycle as well The burden of data reporting and the disclosure of the contractual chain may generate disputes invoking business secrets, and legal objections

The main dilemma is stretched between speed and control. The payment deadlines of the cohesion cycle are a hard constraint: funds not drawn down are lost, and therefore every built-in control step is a real risk to the drawdown rate. This is why MIAK proposes the review gate tied to a value threshold — contracts above 5 billion forints make up a fraction of the number of projects but the overwhelming part of the amount, so the control works where the stake is, and does not slow the mass of smaller items. The proposal tips over to the risk side if the review gate turns into a veto, or if the public formula is softened with so many exceptions that the allocation practically returns to individual discretion — at which point the system retains the administrative burden but loses its benefit.

Part V — Measurability and summary

5.1 What is worth tracking? (proposed KPIs)

The performance indicators (KPIs, Key Performance Indicators) below are worth using to judge whether the process is going in a good direction. These are proposals, not government commitments.

  • Data publicity: whether by the first quarter (Q1) of 2027 a downloadable project list covering the whole envelope, with beneficiary, amount and indicator, is available — the proposed target is coverage of 95 per cent of the contracted amount.
  • Territorial targeting: what percentage of development-purpose payments goes to districts in the bottom third of the development index — worth measuring against the actual figure of the previous cohesion cycle as a starting point.
  • Intensity of competition: what percentage of contracts above 5 billion forints had a single valid bidder — the proposed target is a level below 15 per cent.
  • Payment pace: the share of the funding envelope paid out by the end-of-cycle deadline — the 95 per cent target of the Cohesion Pillar 2.0 programme point gives the benchmark.

5.2 Summary

MIAK’s request of the decision-maker: behind the sixty announced items there should be, by the end of the year, a project-level, downloadable public database; from the beginning of 2027 a public territorial allocation formula; and for contracts above 5 billion forints a mandatorily public, independent professional opinion before the conclusion of the contract. And of the public it asks that in the coming year it use as its yardstick not the detail of the announcement but the traceability of the payments.

This proposal rests on two MIAK foundational values. Transparency moves here because with a one-off, large-volume package of funds publicity is not an ex-post check but a precondition of the quality of the allocation decision: data that becomes accessible only at the end of the cycle can no longer influence what it is about. And accountability, because MIAK applies to the present government the same standard it would have applied in the documented cases of the earlier spending practice — consistency of principle is here not a question of style but a condition of the organisation’s credibility.

Part VI — Justifications and further sources

6.1 The press framing by spectrum

The economic band sharpened the story towards the structure and the figures of the action plan: Portfolio made the itemised presentation of the directions of use the focus of its headline, and in a separate piece followed the Hungarian accession to the EU satellite system and the more than 100-billion-forint support envelope to be distributed within days. In this band the announcement appears primarily as a question of implementation and allocation.

The liberal-left band is divided in its framing. Telex reported the content of the announcement in detail, item by item, thus strengthening the presentation character. HVG, however, on the same day carried two thematically counterpointing pieces: articles built on freedom-of-information requests about the previous government’s Brussels luxury restaurant plan and about state purchases of foreign real estate. This editorial decision places the topic of the use of funds in the context of historical spending practice — it does not qualify the present plan but brings in the yardstick. HVG’s earlier podcast pieces also place the emphasis on the macroeconomic yield (the four per cent growth potential).

The conservative band, in Mandiner’s report, put the transformative promise of the announcement in the headline (“it will transform Hungary”), that is, it chose a quotation-based, reporting frame without substantive critical context. The public-affairs band touched the topic on this day through 24.hu’s Brussels restaurant article — that is, it brought not the plan of use but its historical counterpoint.

It holds for the spectrum as a whole: in today’s Hungarian press several outlets reported the content of the announcement in detail, but not one made the question of its traceability a main consideration. This is the gap to which this analysis responds.

6.2 Facts and data

Item Amount Source
Rental housing and student hostel programme 600 million euros (more than 230 billion forints) Telex, 7 August 2026
Equalisation of access to digital education more than 151 billion forints Telex, 7 August 2026
EU accounting of school investment previously realised from domestic funds 54 billion forints Telex, 7 August 2026
Healthcare development in total close to 170 billion forints Telex, 7 August 2026
Of which general practitioner care 24 billion forints Telex, 7 August 2026
EU accounting of previously domestically financed healthcare and digitalisation investment more than 125 billion forints Telex, 7 August 2026
Capital increase of the Hungarian Development Bank for SME financing 645 billion forints Telex, 7 August 2026
New suburban railway trainsets 42 units (the current stock is 40–50 years old) Telex, 7 August 2026
New double-decker multiple units for rural InterCity traffic 35 units Telex, 7 August 2026
Extent of the action plan 5 annexes, more than 60 items Portfolio, 7 August 2026

Two structural features can be read out of the table. The first: a significant part of the announced items — 54 billion forints for school investment, more than 125 billion in healthcare — is not new development but the elevation into EU accounting of investment previously realised from the domestic budget. This is a legitimate and established technique which frees up domestic budgetary room for manoeuvre, but from the point of view of impact measurement it is a different category from new capacity: the use of the freed-up domestic funds has to be tracked separately, otherwise the appearance of double counting arises. The second: the largest single item is the development bank capital increase, which is not a direct development but a financial intermediary instrument — here the output indicator cannot be the amount disbursed, but the number of enterprises actually financed and the improvement in access to credit.

6.3 Policy dimensions

  • Territorial inequality and rural policy (programme points) — the micro-regional development index as the basis of allocation, and the data-based allocation of cohesion funds (programme point ID: TE1, TE2, TE4);
  • Transparency and anti-corruption policy (programme points) — project-level public-money publicity, public procurement pattern analysis, cohesion accountability (programme point ID: A1, A2, A8);
  • Economy (programme points) — the extension of mandatory ex-post impact assessment to high-value development items (programme point ID: G20);
  • Social policy (programme points) — professional monitoring of the allocation of cohesion funds and the target value of the drawdown rate (programme point ID: SZ14);
  • Transport and infrastructure (programme points) — the prioritisation of vehicle procurements and railway developments according to passenger traffic data (programme point ID: KO4).

6.4 Literature in detail

6.4.1 Susan Rose-Ackerman: Corruption and Government — Causes, Consequences, and Reform

The starting point of Rose-Ackerman’s book is that corruption is not primarily the problem of bad people but of bad incentives. If the state allocates a scarce advantage on the basis of criteria other than willingness to pay — and development support is exactly such an advantage — then the bribe takes over the market-clearing role that the price would fill. From this follows the author’s most important warning against a purely criminal-law approach:

“Enforcement and monitoring are needed, but they will have little longterm impact if the basic conditions that encourage payoffs are not reduced. If these incentives remain, the elimination of one set of »bad apples« will soon lead to the creation of a new group of corrupt officials and private bribe payers.”

In the case of the 6,000-billion-forint envelope this means: ex-post control and sanction are necessary but not sufficient. If the decision structure remains unchanged — few bidders, non-public allocation criteria, delayed data reporting — then a change of personnel in itself brings no result. It is precisely for this reason that MIAK’s proposal is directed at the structure of the allocation, not at the actors.

📖 Source: Susan Rose-Ackerman: Corruption and Government — Causes, Consequences, and Reform

6.4.2 Robert Klitgaard: Controlling Corruption

The core of Klitgaard’s analysis is that the corrupt rent arises where monopoly position and discretionary power meet an absence of accountability. One of the most important conclusions of his book is that the problem does not depend on the form of ownership:

“If monopoly power and discretionary enforcement remain, consumers can expect to continue to pay too high a price. […] the key ideas regarding underlying conditions might not be capitalism versus state socialism, or the private sector versus the public sector, but rather competition and accountability.”

This sentence is directly applicable to the present package of funds. In the allocation of development funds, monopoly position and discretionary power are a given — nor is it desirable to eliminate them entirely, because policy discretion is governance itself. What can be changed is the third factor: competition (how many valid bidders there are for a contract) and accountability (whether the decision and its result are visible). MIAK’s three proposals are directed at precisely these two factors, and deliberately do not restrict the space of policy discretion.

📖 Source: Robert Klitgaard: Controlling Corruption

6.4.3 European Commission: An Introduction to EU Cohesion Policy

The Commission’s publication describes the frame in which the Hungarian plan of use can be interpreted at all. Cohesion support is not a freely usable transfer: the funds are bound by thematic concentration rules, the development category of the regions determines the co-financing rate, and the directions of use are fixed by operational programmes and the partnership agreement. At the same time the document also emphasises result-oriented planning: every programme has predetermined output and result indicators whose fulfilment has to be reported.

In Hungarian public discourse this layer is regularly lost — the question of “what we spend it on” appears as though it were free governmental discretion. In reality, modification of the direction of use requires a programme amendment procedure in which the Commission is also a decision-maker. From the point of view of MIAK’s proposal this is good news: the indicator-based reporting obligation already exists, so the data is being generated. The only question is whether, at domestic level, broken down by project and in good time, it becomes accessible to the public — or only at the end of the EU reporting cycle, in aggregated form.

📖 Source: European Commission: An Introduction to EU Cohesion Policy

6.5 International comparison

There are several working European models for project-level publicity. Slovakia publishes its public procurement and support contracts in a central contract register, where publication is a condition of the contract’s entry into force — that is, publicity is not an ex-post obligation but a requirement of validity. This solution is strong because it ties publicity not to control but to the validity of the contract. Latvia and Estonia publish the use of the structural funds as a downloadable open dataset broken down by project, together with output indicators. The financial transparency system operating at EU level makes the beneficiaries of directly managed EU programmes searchable — the Hungarian proposal is the extension of this logic to funds under shared management.

The absorption experience is also instructive: in the 2014–2020 cycle the Hungarian drawdown rate was of the order of 81 per cent at the end of the cycle, which is not outstanding in European comparison but is a substantive shortfall relative to full utilisation. Polish and Czech practice shows that higher absorption sprang not from loosening control but from the early strengthening of project preparation capacity — with central project preparation support operated in the most backward regions. In the Hungarian case too this will be a condition of the success of formula-based allocation.

Territorial inequality and rural policy

  • TE1 — Micro-regional development index
  • TE2 — Data-based allocation of EU cohesion funds
  • TE4 — Rural public service minimum

Transparency and anti-corruption policy

  • A1 — Public-money dashboard
  • A2 — Public procurement transparency
  • A8 — Cohesion policy accountability

Economy

  • G20 — Economic policy impact assessment system (Drucker audit)

Social policy

  • SZ14 — Cohesion Pillar 2.0 — maximum utilisation of the Hungarian allocation

Transport and infrastructure

  • KO4 — Railway development with data-based prioritisation

Proposed new programme point: A public territorial allocation formula for development funds — for the Territorial inequality and rural policy area: for the allocation of every development-purpose funding envelope, a formula announced in advance and public in its weights as well, with an itemised obligation to justify departures from it.

6.7 List of sources

Press sources (MIAK press monitor, 8 August 2026 — topic 4):

Knowledge-base references (books):

  • 📖 Susan Rose-Ackerman: Corruption and Government — Causes, Consequences, and Reform
  • 📖 Robert Klitgaard: Controlling Corruption
  • 📖 European Commission: An Introduction to EU Cohesion Policy

Note: the local file path of the books does not appear in the visible text of the blog — only the author and the title.

MIAK internal materials:

  • MIAK policy area: Territorial inequality and rural policy (programme points; programme point ID: TE1, TE2, TE4)
  • MIAK policy area: Transparency and anti-corruption policy (programme points; programme point ID: A1, A2, A8)
  • MIAK policy area: Social policy (programme points; programme point ID: SZ14)
  • MIAK policy area: Transport and infrastructure (programme points; programme point ID: KO4)
  • MIAK press monitor, 8 August 2026 — topic 4, score: 87/100

Additional public data sources:

  • European Commission — Cohesion Open Data Platform
  • palyazat.gov.hu — contracting and payment data
  • State Audit Office of Hungary (ÁSZ) — reports on the use of EU funds
  • European Court of Auditors — annual report on the implementation of the budget

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