Prime Minister Viktor Orbán announced in a radio interview on 27 October 2023 that the government will launch a new National Consultation. The consultation was supported by an intensive advertising campaign: billboards, press and video advertisements, and social media ads encouraged the people to fill out the consultation form.
The latest national consultation was similar in many ways to the 2017 “Stop Brussels!” consultation that cost 7 billion HUF (€18 million) in taxpayers' money. These 11 questions exclusively deal with “Brussels” plans against Hungary. However, they are based on falsehoods, at least according to the European Commission Vice-President, Věra Jourová.
In the first part of this article, we look at 3 claims of the national consultation in detail:
1. Brussels wants to abolish the subsidies on household utility charges
2. Brussels wants to abolish the interest rate cap
3. Brussels wants to abolish windfall taxes in Hungary.
Photo: ATTILA KISBENEDEK/AFP
While it is true that all three measures have been criticized on the EU level,
the relevant EU recommendations are not binding and have been approved by the Hungarian government.
Let's start by looking at what exactly the “Brussels wants to abolish” phrases of the first three questions refer to. In its explanation of each of these statements, the consultation form provides only vague clues as to the sources from which it infers the perceived threat from the EU:
In fact, all three issues are addressed in country-specific recommendations, as mentioned in the case of the interest rate cap. Let's look at what this means exactly.
1. In the European Union, each Member State regularly prepares its national plans: reform programs and stability and convergence programs.
2. These are evaluated by the European Commission, which each year prepares draft country-specific recommendations. These provide policy guidance to each Member State on how to boost employment and growth while maintaining sound public finances.
3. Country-specific recommendations are finally adopted and issued by the Council of the European Union. This body is made up of ministers from the national governments of each Member State.
The latest country-specific recommendations were adopted in June 2023, the full text of the recommendations for Hungary can be found here.
The decision-making process detailed above shows that, although the draft country-specific recommendations are prepared by Commission staff, the Member States decide collectively on the recommendations to be issued. The statements made in the National Consultation therefore refer to recommendations which - even if they were not agreed - were endorsed and accepted by the Hungarian government.
In addition, country-specific recommendations are only suggestions, not binding, and there are no sanctions if a member country decides not to comply with them.
Contrary to the claims of the National Consultation, there is therefore no danger of “Brussels” reaching over the head of a national government to make binding decisions on these issues.
Photo: Dániel Németh / 444.hu
That said, it is true that the three measures are indeed addressed in the country-specific recommendations and other EU documents and analyses have detailed their negative effects on the economy.
The first question of the consultation deals with “Brussels” plans to abolish subsidies for household utility prices. This topic was also addressed in the 2017 national consultation, so it is a rephrasing of the same topic with some additions. The claims made in the 2017 consultation were refuted in detail by the European Commission.
“Brussels” alleged plans to abolish the subsidies might come from the 2023 country-specific recommendations, as the document does indeed include the phrase “energy subsidy measures should be phased out”. The full paragraph reads:
„At the same time, the remaining energy support measures (currently estimated by the Commission at 1.2% of GDP in 2023) should be phased out, contingent on energy market developments and starting from the least targeted ones, and the related savings should be used to reduce the government deficit.”
So the EU has indeed made a recommendation to phase out energy support measures and has detailed the conditions for doing so - all to reduce the government's ballooning budget deficit.
Moreover, it was not “Brussels” but the government itself that canceled partly the energy support measures defended in the consultation. Last August, the government phased out the reduced tariffs for the part above average consumption. While the consultation asks citizens about protecting the energy support measures and “Brussels” interference, the Hungarian government has already included among its objectives the future reform of the support system and has made commitments to the Commission on the reform of the household utility price reduction.
The second question of the consultation sheet deals with “Brussels” plans to abolish the interest rate cap. Gergely Gulyás, Minister of the Prime Minister’s Office already announced at a press conference on 30 November that the government would again extend the interest rate cap, until 1 April for small and medium-sized enterprises and until 1 July 2024 for families and student loans.
In other words, the government already took the measure on interest rates, at least in part, irrespective of the responses to the national consultation. So, it is irrelevant which of the two possible answers one chooses: “The interest rate cap should be extended to 2024” or “Brussels is right, the measure should be abolished”.
This time, the consultation cites the country-specific recommendation as a source. The relevant part can indeed be found in the document:
„Phase out price and interest rate caps to reduce distortive effects and facilitate the smooth transmission of monetary policy”
The recommendation refers, among other things, to the European Central Bank's analysis of the negative effects of the interest rate cap. The study examines the temporary policy measures introduced since 2021 to preserve household purchasing power. In addition to the interest rate cap, it includes fuel and food price caps and energy subsidies. The study concludes that the costs of these measures, through higher indirect taxes, have been borne primarily by businesses and the financial sector, while the distortive effects of the measures have contributed to a fall in domestic production and higher prices for products not directly affected by the price caps, and have prevented demand from adjusting to the new economic environment.
The third question of the national consultation concerns the so-called windfall or “extra profit” tax, which “Brussels” claims to want to abolish as well as the energy subsidies, the interest rate cap, and the food and fuel price caps.
However, this objective is set out in a program compiled by the Hungarian government.
In its Convergence Programme 2023-2027, the government has included among its objectives for the tax system the phasing out of extra-profit taxes (the Convergence Programme is a three-year budget plan that all non-euro area member countries are obliged to prepare and submit to the European Commission.)
In the government's own words, “the temporary extra-profit taxes introduced to compensate for the negative budgetary impact of the Russo-Ukrainian war and the energy price explosion that has occurred will not become an integral part of the tax system and will be phased out."
The European Council recommendation contains several criticisms of sectoral windfall taxes. According to the document, recent market interventions by the state in several sectors have weakened legal certainty:
„These interventions tended to discourage or limit EU and foreign investment in certain markets, in effect enabling purchases of companies by state-owned enterprises or private firms with close ties to the government. They seriously affect the principles of the single market and of the rule of law 27, curbing opportunities for sustainable economic growth” – the document says.
The national consultation is accompanied by an intensive media campaign, Orbán Viktor and the politicians of Fidesz encourage people to fill in the consultation form. Billboards appeared everywhere, social media platforms were flooded with virtually identical messages from government officials, politicians, pro-government analysts, and influencers – in the form of political ads.
Thus, the companies behind the very large online platforms also profit from the dissemination of false information in the consultation: Meta gets money (partly Hungarian taxpayers’ money) through Facebook and Instagram, and Google through ads on their websites and YouTube commercials.
The results of a keyword search of Meta's (Facebook and Instagram) publicly accessible advertising database show how some of the posts of pro-government politicians and MPs have flooded the social platforms since the announcement. But pro-government public foundations and research institutions such as the Alapjogokért Központ, the Nézőpont Intézet, the pro-government media (HírTv, a Metropol, or the vasarnap. hu), and the public broadcasting company that also spreads pro-government propaganda – encourages people to take part in the national consultation.
How did one and a half million responders become "The majority of the Hungarian people"?
The latest national consultation on “the defense of national sovereignty” has barely ended, and the government has already launched a billboard campaign based on false information. We looked at what percentage of voters rejected “migrant ghettos”, “gender propaganda” and sending arms to Ukraine.
The results of the thirteenth National Consultation – this time on the "defense of national sovereignty" – were published by the government on 25 January 2024. A total of 1 545 628 valid questionnaires were returned by the deadline, as we have seen in the previous 12 national consultations with very consistent answers.
Source: Hungarian Government’s official Facebook page
"The Hungarian people have stood up for the sovereignty of our country, and an overwhelming majority of them said no to having others decide for us on issues that fundamentally affect our lives," said government spokesperson Alexandra Szentkirályi in a short video posted on the government's official YouTube channel.
According to Szentkirályi,
more than 98 percent of Hungarians agree that,
Shortly after the announcement of the results, the government started a communication campaign: billboards announcing the results appeared in public spaces and the advertisements flooded the pro-government press, newspapers, TV and radio channels, and online news portals.
The billboards featured the issues most supported by respondents:
99% NO on migrant ghettos (Photo: Attila Kisbenedek / AFP)
99% NO on gender propaganda (Photo: Attila Kisbenedek / AFP)
99% NO on sending arms (Photo: Attila Kisbenedek / AFP)
Certainly not that “the overwhelming majority of Hungarians” said no to these issues.
The questionnaire was sent to Hungarian citizens eligible to vote. The National Election Office's (NVI) register of eligible Hungarians at the time of the 2022 parliamentary elections showed 8,215,304 Hungarian citizens. On the NVI website, you can find daily updated data - "How many people would be able to vote in the different elections if they were held today?" - compiled based on the current state of the electoral rolls and voter eligibility. According to this, for example, on 15 February, the last time we looked, 8 140 206 people would have been able to vote in a general election/national referendum.
The 1,545,628 completed questionnaires mean that 18.9% of eligible citizens took part in the national consultation.
The overwhelming majority of this 18.9 percent answered the questions as the government intended.
So, Szentkirályi's claim that 98% of Hungarians agree with the statements made in the consultation questionnaire is not true. The propaganda about the success of the previous consultation’s results was based on a similar fallacy. Billboards proclaimed that “Hungarians have decided: 97% NO to EU sanctions”, when in fact 16.5% of voters agreed with the government on the issue.
Through a public interest request, we also found out that the government advertised the false information with at least HUF 5 billion (€ 13 million). The government paid this money to two companies of Gyula Balásy, who has a virtual monopoly on the market for government communication contracts, New Land Media Ltd. and Lounge Design Ltd., which, according to a recent summary have won government contracts worth HUF 293.7 billion (€ 750 million) in recent years.
97% no to sanctions (Photo: Attila Kisbenedek / AFP)
The costs of the national consultations so far and the number of respondents are summarised in this chart:
