Part I — Situation overview

On 8 June 2026 Andrea Bujdosó, Tisza’s parliamentary group leader, announced: on Tuesday the party will submit to the National Assembly the transparency and anti-corruption legislative package that also contains the legal amendments needed to obtain the EU funds. The package ties together several elements significant in themselves — the transformation of the MPs’ asset-declaration system, the banning of hate-inciting political advertisements and the curbing of political posters, and the abolition of the Sovereignty Protection Office, of which Márton Melléthei-Barna, minister of justice, said the office “did not fulfil its original function but served power interests”.

The subject is not new, nor is it merely the tabling of a bill — it is a milestone of a process that has dragged on for years. Hungary’s EU cohesion and recovery funds were frozen because of the rule-of-law conditionality system, the so-called conditionality mechanism. At the end of May Péter Magyar negotiated with Ursula von der Leyen, President of the European Commission, on how some 16.4 billion euros of funds could be released. The Recovery and Resilience Facility (RRF) has a total of 27 preconditions, of which the meeting of five conditions was the subject of substantive debate: settling the matter of the public-interest asset-management foundations performing public tasks (organisations referred to in the press as KEKVA) — the most important element of the package —, the Integrity Authority’s new powers, making asset declarations more transparent, judicial review of prosecutorial decisions, and the creation of an online database collecting public expenditures. The prime minister indicated that there had been commitments the government had “over-committed to” (the transformation of the public-procurement system and accession to the European Public Prosecutor’s Office, the EPPO), because these did not even feature among the 27 expectations.

In MIAK’s reading the real stake of the news is not the 16.4-billion-euro figure but the character of the institutional reforms leading to it. The room for manoeuvre of the Hungarian public finances is tight even today, while the foreign-currency reserve — just before the EU money arrives — stands at a historic peak (according to the MNB, the Hungarian National Bank, 61.1 billion euros in May 2026, more than 15 billion higher in a year). The funds are therefore important but not an end in themselves: for MIAK the reforms set as conditions — independent justice, transparent public procurement, anti-corruption institutions — represent value in themselves, and the money is their consequence.

Part II — Literature foundation

Before turning to MIAK’s proposals, it is worth fixing the scientific frame in which the EU conditionality system can be interpreted. The distinction drawn by Daron Acemoglu and James A. Robinson (economists, leading authors of institutional economics, who received the Nobel Memorial Prize in economics in 2024) between inclusive and extractive institutions gives the key directly: a system is inclusive that prioritises the security of private property, the impartiality of the legal system and the equal provision of public services — and it is precisely these features that the EU conditionality system calls for. Daniel Kaufmann and his co-authors (World Bank researchers, developers of the international governance-indicator system, the Worldwide Governance Indicators) supplement this with their proposition that “the quality of governance matters for development” — that is, the funds are put to good use if behind them stands good institutional quality and transparent use. The two propositions together give MIAK’s frame: meeting the conditions is not a Brussels burden but precisely the building of those inclusive institutions through which the funds can be put to use at all. The detailed literature treatment — author by author, with quotations — can be found in section 6.4 Literature in detail.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable aspects along which the funds package becomes institution-building rather than mere money-drawdown.

3.1 Meeting the conditions as a value in itself — with realistic scheduling

The first and most important proposal is to change the framing: the government should communicate the meeting of the conditions not as a party-political victory, an “extraction” of the money, but as an institutional reform of which the funds are the consequence. Settling the matter of the KEKVA foundations, the asset-declaration reform and the public-expenditure database serve the good of Hungarian public life in themselves — even if not a single euro were to arrive. This is the logic of transparent foreign policy (KP3): the commitments are public, their scheduling accountable. Realistic scheduling is key because the prime minister himself indicated that the deadlines of some preconditions had lapsed or become moot — for MIAK, over-promising (a commitment past the deadline or unfulfillable) is just as damaging to credibility as procrastination.

3.2 Transparent public procurement and cohesion accountability — the condition of absorption

The second proposal targets the quality of use. The funds are put to good use if they are spent through transparent public procurement (A2), with a low irregularity rate — this is the core of cohesion accountability (A8). Estonia’s example shows that the irregularity rate of EU funds can be pushed below 0.5 per cent with proper digital record-keeping and internal audit; this is not a Brussels wish but the protection of one’s own taxpayers’ money. In the Acemoglu–Robinson inclusive-institution frame (see 6.4.1) transparent public procurement is precisely that “impartial legal system and level playing field” which turns the funds into development rather than rent-seeking.

3.3 A data-driven budget and public absorption tracking

The third element is that the use of the funds should become traceable in real time. MIAK proposes extending the principle of the data-driven budget (G1) to the EU funds: every project with a machine-readable, public data sheet, target indicator and performance metric. The online database collecting public expenditures — which is in any case one element of the conditionality system — thus becomes not merely a Brussels “tick” but a lasting transparency instrument. In the Kaufmann-type measurement frame (see 6.4.2) making the quality of fund use measurable is what makes governance quality — and thus the development impact — assessable at all.

The three proposals are bound together by a single principle: in MIAK’s reading the EU conditionality system is an external institutional frame, that is, a constraint that disciplines and makes lasting the domestic reforms — not a limit but an external support for building inclusive institutions. The funds are the reward of a well-built institution, not the prize of political skill.

Part IV — Expected impacts and risks

Dimension Expected impact Risk
Economy The 16.4-billion-euro funds can finance investment, catch-up, and the green and digital transition With weak absorption capacity the money is put to use slowly or badly; over-commitment may cause slippage
Rule of law / institutions Meeting the conditions builds lasting, inclusive institutions The reform may become formal if only Brussels compliance is the goal, not a working institution
Foreign policy A predictable, cooperative Hungarian position strengthens the country’s bargaining power The domestic-political popularity risk (recommendations framed as austerity) may hinder the reforms

The main consideration beneath the table is the balance of pace and quality. The pro-government press frames the EU recommendations as austerity serving investors’ interests (especially the recommendation on the sustainability of the pension system) — this is a real communication tension that, for MIAK, must not be silenced but honestly weighed: which recommendation serves the long-term interest of Hungarian citizens, and which calls for debate. The proposal tips towards the risk side if the arrival of the funds suppresses the substance of the reform: the “drawdown” of the money becomes a political success story while institutional quality does not improve substantively.

Part V — Measurability and summary

5.1 What is worth tracking? (suggested KPIs)

MIAK considers the following suggested performance indicators (KPIs) worth tracking over the next 12–24 months:

  • Condition fulfilment: how many of the 27 preconditions are met substantively and documented — not the announcement but the adopted law and the working institution count.
  • Actual fund inflow: how much of the agreed 16.4 billion euros actually arrives, and at what pace.
  • Absorption quality: the irregularity rate of projects financed from EU funds (aim: a substantive reduction towards the 0.5 per cent Estonian benchmark).
  • Transparency: whether the machine-readable, public public-expenditure database works, and whether it covers the cohesion and recovery projects.

5.2 Summary

MIAK’s key message is simple: the funds package to be submitted on Tuesday is successful if it is about not “extracting” the money but building institutions. MIAK asks decision-makers to communicate the meeting of the conditions as a value in itself and to carry it out with realistic scheduling, without over-promising, and to spend the funds through transparent public procurement, in a publicly traceable manner. This proposal moves two MIAK foundational values: transparency, because the quality of fund use is measurable only on machine-readable, public data, and openness, because MIAK interprets the EU conditionality system not as external coercion but as a cooperation-based frame that disciplines the domestic reforms. It is precisely these two that move because the stake is not the money in itself but whether the country is able to build lasting, inclusive institutions — and this can be done credibly only in a transparent, open way.

Part VI — Justifications and further sources

6.1 Press framing by spectrum

The subject moved the whole spectrum, with sharply differing narratives. The economic band (Portfolio) concentrated on the factual side: the content of the legislative package, the 16.4-billion-euro item and the record of the foreign-currency reserve. The left-liberal and public-affairs band (Telex, 24.hu) highlighted the package’s internal elements — the asset-declaration reform, the abolition of the Sovereignty Protection Office — as a rule-of-law turn. The pro-government, conservative band (Mandiner, Magyar Nemzet), by contrast, criticised the conditionality system: according to Mandiner the EU country-specific recommendations are made “not for the well-being of citizens but for the interests of investors”, and it interpreted the recommendation on the sustainability of the pension system as covert austerity, while also sharply disputing Péter Magyar’s governing ability. The spectrum’s difference shows well the relevance of MIAK’s framing: the debate runs on a “rule-of-law turn” versus “Brussels diktat” axis, while the substantive question — whether the conditions build an inclusive institution, and whether the funds are put to good use — is central on neither extreme frame.

6.2 Facts and data

  • The order of magnitude of the releasable EU funds: ~16.4 billion euros (Péter Magyar–von der Leyen agreement, May 2026).
  • The RRF has 27 preconditions; of these the meeting of five conditions was the subject of substantive debate (KEKVA settlement, Integrity Authority powers, asset declaration, judicial review of prosecutorial decisions, public-expenditure database).
  • Hungary’s foreign-currency reserve in May 2026 was 61.1 billion euros — a historic peak, more than 15 billion higher in a year (source: MNB, May 2026).
  • International benchmark: in Estonia the irregularity rate of EU funds is below 0.5 per cent — one of the lowest in the EU (source: MIAK territorial background material, precedents of programme point A8).

6.3 Policy aspects

  • Foreign policy (programme points) — a transparent, predictable EU position and fund diplomacy give the frame;
  • Economy (programme points) — the data-driven budget and the quality of fund absorption are the economic stake;
  • Transparency and anti-corruption policy (programme points) — public-procurement transparency and cohesion accountability are the condition of use.

6.4 Literature in detail

6.4.1 Acemoglu–Robinson: Why Nations Fail

According to Acemoglu and Robinson the key to lasting development is the inclusive economic and political institution. As they write: the economic institutional system is inclusive “if it prioritises the security of private property, the impartiality of the legal system and the provision of public services, thus creating equal conditions”, and allows new enterprises to enter the market. By contrast the aim of the extractive institution is “to extract money and resources from one subset of society” for the benefit of another. From the standpoint of the Hungarian EU conditionality system this distinction is decisive: the elements required by conditionality — judicial independence, transparent public procurement, anti-corruption institutions — are precisely the features of the inclusive institution. The funds turn into development if they arrive in an inclusive institutional frame; in an extractive institution they merely fatten rent-seeking.

📖 Source: Daron Acemoglu – James A. Robinson: Why Nations Fail

6.4.2 Daniel Kaufmann et al.: Governance Matters

Kaufmann and his co-authors constructed six aggregate governance measures — including the government effectiveness, rule of law and control of corruption indices — and empirically showed that better governance is closely associated with better development outcomes. For the Hungarian funds debate the lesson is that the sum of money itself is not a sufficient indicator: the impact of the funds depends on governance quality — on transparency, accountability, the rule of law. This is why MIAK proposes that the use of the funds become measurable and public; only thus can it be assessed whether the 16.4 billion euros actually turns into development or is absorbed by a weak institutional environment.

📖 Source: Daniel Kaufmann, Aart Kraay, Pablo Zoido-Lobatón: Governance Matters

6.5 International comparison

In the quality of fund absorption Estonia is the international benchmark: thanks to digital record-keeping and strong internal audit, the irregularity rate of EU funds is one of the lowest in the EU (below 0.5 per cent). Poland, in the 2014–2020 cycle, reduced the share of suspicious procedures by some 15 per cent with a public-procurement “red flag” system. Both examples show the same thing: it is not the obtaining of the funds but the inclusive institutional frame and transparent use that decide whether the money turns into catch-up or leakage.

Foreign policy

  • KP3 — Transparent foreign policy
  • KP8 — Economic-diplomacy integration

Economy

  • G1 — Data-driven budget

Transparency and anti-corruption policy

  • A8 — Cohesion-policy accountability
  • A2 — Public-procurement transparency

6.7 Source register

Press sources (MIAK press monitor, 9 June 2026 — topic 3):

  • [Telex] On Tuesday Tisza submits the package of bills needed to obtain the EU funds — https://telex.hu/belfold/2026/06/08/kedd-torvenyjavaslat-csomag-tisza-part-vagyonnyilatkozat-szuverenitasvedelmi-hivatal
  • [Mandiner] The European Union has handed the new government its task — https://mandiner.hu/gazdasag/2026/06/kiadta-az-europai-unio-a-feladatot-az-uj-kormanynak-de-nem-sok-esely-van-ra-hogy-magyar-peter-kotelnek-allna
  • [Portfolio] Hungary has never had so much foreign-currency reserve — https://www.portfolio.hu/gazdasag/20260608/soha-nem-volt-meg-ennyi-devizatartaleka-magyarorszagnak-pedig-meg-meg-sem-erkeztek-az-unios-penzek-841896
  • [Portfolio] Séjourné: The problem is not the Chinese investments but what they give to Hungary or to Europe — https://www.portfolio.hu/unios-forrasok/20260608/sejourne-nem-a-kinai-beruhazasokkal-van-baj-hanem-azzal-mit-adnak-magyarorszagnak-vagy-europanak-841430
  • [24.hu] Zsolt Kerner: Drawing down the EU money will be a brutal sprint — https://24.hu/belfold/2026/05/29/unios-penzek-ursula-von-der-leyen-magyar-peter

Knowledge-base references (literature):

  • 📖 Daron Acemoglu – James A. Robinson: Why Nations Fail
  • 📖 Daniel Kaufmann, Aart Kraay, Pablo Zoido-Lobatón: Governance Matters

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

MIAK internal materials:

  • MIAK policy area: Foreign policy (programme points; programme point ID: KP3)
  • MIAK policy area: Economy (programme points; programme point ID: G1)
  • MIAK policy area: Transparency and anti-corruption policy (programme points; programme point ID: A8)
  • MIAK press monitor, 9 June 2026 — topic 3, score: 88/100

Additional public data sources:

  • MNB international foreign-currency reserve statistics (May 2026)
  • EU RRF scoreboard, European Commission country-specific recommendations (CSR), EU rule-of-law report

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