EU to release €545 million of frozen funds for Hungary prompting worry among MEPs

The European Commission approved the regrouping of €545 million for Hungary from its previously frozen cohesion funds but most payments remain subject to the rule of law conditions set earlier.

As part of the mid-term review process of the cohesion policy, the Commission adopted a decision on the reprogramming of €545 million by Hungary from the Economic Development and Digital programmes to new STEP priorities.

"However, since Hungary continues to not fulfil the Horizontal Enabling Condition on the Charter of Fundamental Rights relating to academic freedom, the newly reprogrammed funds will not be disbursed," a Commission spokesperson told Euronews.

Hungary is subject to various EU sanctions due to systemic corruption risks and concerns about the rule of law. Most of the €28 billion in funds are not available to Budapest.

During the mid-term review of the seven-year budget, countries can regroup their unused funds for defence and dual-use goods and projects. Hungary has asked to unfreeze €545 million.

According to the Hungarian daily paper Népszava, a big part of the funds, €395 million, is regrouped from funds frozen because of threats to academic freedom in Hungary. According to the Commission, this money will only be paid to Hungary once the conditions set earlier are fulfilled.

"The Commission considers that the Horizontal Enabling Conditions can be fulfilled only if universities run by public interest trusts are clearly excluded from these new priorities, or the issues raised by the Commission in the past concerning public interest trusts are resolved," a statement said.

Worry among MEPs

Daniel Freund, a German Green MEP and a fierce opponent of Hungary's Prime Minister Viktor Orbán in Brussels, has criticised the move and threatened legal action.

Freund told Euronews that in the new envelopes, it could be easier for Hungary to fulfil the criteria and access the money.

"The Commission should never have released these funds. They were frozen because Orbán dismantled the rule of law — and nothing has changed. The fact that he can now effectively unblock hundreds of millions for himself is outrageous. As Parliament, we are currently examining legal action against this decision," he said.

Earlier, the Financial Times reported that the Commission is about to unfreeze €550 million of frozen funds for Hungary in order to gain the goodwill of Viktor Orbán for the next EU sanctions package against Russia.

The European Commission denied that any such trade-off is taking place.