Part I — Situation overview

On 12 September 2026 Finance Minister András Kármán announced in a social-media video that the balance of the Single Treasury Account (KESZ) had grown more than fivefold since the start of the government’s term, to over 5,000 billion forints. The KESZ is the state’s current account, kept by the Hungarian State Treasury: pensions, public-sector salaries and other state payments are made from it. According to the minister, when the government took office the balance did not even reach 1,000 billion forints, meaning the state had practically no financial room for manoeuvre, and an unexpected expense would have forced immediate, expensive borrowing. Today the balance stands “stably above 5,000 billion forints”. On the same day HVG reported, based on fresh data from Eurostat (the statistical office of the European Union), that of the seven Central and Eastern European EU member states, Hungary recorded one of the smallest increases in productivity per hour worked. Portfolio, meanwhile, highlighted from the voluntary pension fund Aranykönyv (Golden Book) of the Hungarian National Bank (MNB) that the funds’ assets grew in 2025 despite the extraordinary withdrawal for housing purposes.

The three data points speak about different time horizons. The Treasury balance is about solvency over the coming weeks; productivity is about wages over the coming decade. MIAK’s analysis of 9 September dealt with separating the one-off and permanent items of the August deficit figure; MIAK’s earlier analyses touching on productivity approached it from the angle of industrial policy and wage coordination. This piece asks a third question: what a cash stock proves and what it does not, and how the productivity gap can be made a metric of budget planning. The question is topical: according to Gyula Barabás, State Secretary responsible for public finances, the draft 2027 budget and the medium-term plan will be published in the second half of October.

MIAK’s reading: the KESZ balance is a stock indicator, not a balance indicator. Put simply, the monthly change in the account is the difference between financing and the deficit. According to the Ministry of Finance’s data of 8 September, the cumulative January–August deficit of the central subsector was 5,169.1 billion forints. In a deficit year the account can grow only if the state raises more funds than the deficit — primarily through bond issuance. Rebuilding the buffer may still be the right decision, and the liquidity risk has indeed fallen. But the announcement in itself does not prove a fiscal improvement: that would require knowing the composition of the sources as well.

Part II — Foundations in the literature

Three authors provide the frame in which the short-term liquidity news and the long-term productivity gap can be interpreted together. Daron Acemoglu, a Turkish-born American economist and one of the leading authors of institutional economics, received the Nobel Memorial Prize in Economics in 2024. In his textbook Introduction to Modern Economic Growth (2007) he distinguishes the proximate causes of growth — capital, skills, technology — from the fundamental causes. He argues that income and productivity differences between countries are explained primarily by differences in economic institutions. The International Monetary Fund’s (IMF) World Economic Outlook 2024 records that, with narrow fiscal space, reallocating spending towards productivity-enhancing expenditure both supports growth and eases spending pressure. This requires a clear medium-term plan and carefully sequenced reforms. Ha-Joon Chang, a South Korean-born Cambridge development economist, warns in 23 Things They Don’t Tell You About Capitalism (2010) that a nation’s productivity depends less on the skills of individuals than on how well it organises them into high-productivity firms and institutions. The detailed treatment of the literature — by author, with quotations — is in section 6.4 Literature in detail.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable measures. The first makes the source of the Treasury buffer visible, the second makes the productivity gap part of budget planning, and the third closes the side thread of the pension fund data.

3.1 Monthly Treasury source breakdown and net financing requirement (from the October 2026 release)

MIAK proposes that the Ministry of Finance and the Government Debt Management Agency (ÁKK) — the body responsible for financing the state’s debt — publish, together with the monthly public finance release and in a machine-readable table, the closing balance of the KESZ and its monthly change, broken down into at least five lines. These are: the cash-flow deficit or surplus, net forint bond issuance, net foreign-currency issuance, EU pre-financing and reimbursements, and other items. The table should also include the expected net financing requirement for the rest of the year, that is, how much new funding still has to be raised to cover the deficit and maturing debt. In addition, the government should state what buffer level it considers justified, and how many months of payments it regards that amount as covering. This is a direct application of the G1 data-driven budget programme point. Within the G23 public-debt sustainability framework, it provides the monthly data from which the price of the buffer — the interest cost of financing the reserve — can be calculated. A reserve of 5,000 billion has a price if it was built from issuance. According to the state secretary, gross cash interest expenditure on the debt was around 4,200 billion forints last year. With an interest burden of that size, the public can legitimately ask how much of the buffer is “borrowed money in the account”.

3.2 A productivity target indicator in the medium-term budget plan (with the October submission)

MIAK proposes that the medium-term plan to be published in the second half of October also contain an explicit target indicator: gross domestic product (GDP) per hour worked, measured against the average of the regional comparison group — the Visegrád Four and Romania. The latest Eurostat figure should serve as the baseline, and the plan should state the pace of convergence it assumes up to 2030. The indicator should also be built into budget planning. In the expenditure chapters, items explicitly targeting productivity should be flagged: R&D (research and development), digitalisation, competition supervision, vocational training and support for corporate technological upgrading. The annual final accounts should then also show how the target indicator has developed. The IMF’s recommendation (see 6.4.2) states precisely that, with narrow room for manoeuvre, spending should be reallocated to these items rather than cut across the board. The institutional complement of the metric is the G24 institutional quality index. In Acemoglu’s frame (see 6.4.1) productivity is the proximate cause and institutions the fundamental cause, so the two must be tracked together. The firm-level instrument is the FO9 productivity movement.

3.3 Ex-post impact assessment of the housing-purpose pension fund withdrawal (by the first half of 2027)

According to the Aranykönyv data, in 2025 members submitted withdrawal claims for housing purposes worth 125 billion forints, of which the funds paid out 105 billion. Despite this, the sector’s assets grew by 150 billion forints. MIAK proposes that the Ministry of Finance, on the basis of supervisory data, prepare an impact assessment of the long-term price of the withdrawal by the first half of 2027. The assessment should show how large a loss of retirement savings the withdrawn amount represents when calculated at the 20-year median net return (6.4 per cent), by income group and age group. The favourable sector-level figure masks the individual loss of the members concerned. The result of the assessment should be a precondition for any future extraordinary withdrawal option. This protects the supplementary pillar of the SZ13 pension adequacy programme point. The acceleration of household lending — the household loan stock grew by 20 per cent in a year — falls within the scope of G22 financial-stability monitoring: drawing down housing savings and rising indebtedness are two sides of the same demand pressure.

The three proposals are bound together by the same principle: a favourable figure becomes information once it is clear from what source and at what future price it came about. The Treasury buffer provides short-term security, but without a source breakdown its cost cannot be measured. The productivity gap is a long-term risk, but without a target indicator it will have no owner in the budget. Pension fund assets grew, but the loss of individual savers is not visible in the sector-level data.

Part IV — Expected effects and risks

Dimension Expected effect Risk
Economy and public finances The monthly source breakdown reduces financing uncertainty, and stating the buffer level makes issuance policy more predictable for investors Overly detailed monthly liquidity disclosure may invite short-term market speculation; if it turns out the buffer was built largely from issuance, this weakens the “improvement” narrative
Labour market and productivity The target indicator gives productivity an owner in the budget and, through the final accounts, makes spending priorities measurable year by year Productivity per hour worked moves slowly and depends on many factors; within one term the government’s influence is limited, so the indicator may become a political talking point
Society and pensions The impact assessment of the withdrawal makes the long-term loss of individual savers visible and prevents a new wave of withdrawals being launched without an impact assessment The result of the assessment does not change amounts already withdrawn; members who used the withdrawal may perceive it as reproach

The main tension of the package lies between transparency and communication convenience. The 5,000 billion figure is a politically strong message, while the source breakdown may weaken it — if it turns out that a significant part of the buffer was built from issuance. In MIAK’s view this is precisely the argument for the breakdown: building the reserve from issuance can also be rational, and this can be openly defended. What cannot be defended is the absence of a breakdown, because then every later decline becomes suspicious. For the target indicator the risk is that productivity moves little within one term. That is why the proposal asks not for an annual delivery obligation but for a path and annual measurement against it. The proposal tips into risk if the target indicator ends up only in a communication document instead of the budget, and does not appear in the expenditure chapters.

Part V — Measurability and summary

5.1 What is worth following? (suggested KPIs)

MIAK proposes four performance indicators (KPIs, in English: Key Performance Indicator) from which it will be visible in 6, 12 and 24 months whether the proposals have been implemented:

  • Appearance of the monthly KESZ source breakdown: the suggested target is that from the October 2026 public finance release a machine-readable table show the monthly change in the account by deficit, net forint and foreign-currency issuance, and EU items.
  • Inclusion of the productivity target indicator in the medium-term plan: it is worth following whether the plan published in the second half of October contains a numerical baseline and a path to 2030 for the regional comparison of GDP per hour worked.
  • Growth of productivity per hour worked relative to 2020: the current Hungarian figure of 6 per cent is among the weakest in the region; the suggested target is that by 2028 it reach the median of the seven-country regional group.
  • Completion of the impact assessment of the housing withdrawal: the suggested target is that by the end of the first half of 2027 an estimate of the loss of retirement savings, broken down by income and age group, be publicly available.

5.2 Summary

MIAK’s request is simple. The existence of the Treasury buffer is good news, but the public also needs to know how much of it is revenue surplus and how much is borrowed money. That is why MIAK asks for a monthly source breakdown, together with the net financing requirement and the committed buffer level. The productivity gap is the most persistent problem of the Hungarian economy, so it should appear in the October medium-term plan as a numerical target indicator and as a flagged priority in the expenditure chapters. And the housing-purpose pension fund withdrawal should be repeatable only after an ex-post impact assessment.

Two MIAK foundational values are at stake. Transparency, because a stock indicator without a source breakdown is more communication than accounting: even good news is credible only if the figures behind it can be verified. Data-drivenness, because the productivity gap has been known for years, yet budget decisions have no metric against which spending priorities can be measured. As long as there is no target indicator, the gap is everyone’s problem, and therefore no one’s.

Part VI — Reasoning and further sources

6.1 Press framing by spectrum

In the economic band Portfolio carried the KESZ news as a relay of the finance minister’s video: the article follows the minister’s reasoning about the earlier liquidity danger and the present stability, but did not ask the question of the source. It did not compare the growth of the balance with the cumulative deficit or with issuance data. The same paper presented the pension fund data in an explicitly positive frame: according to the headline, something happened “that few would have dared to bet on”, and the text emphasises the sector’s resilience rather than the long-term loss of individual members. By contrast, the paper’s credit-market article of 3 September struck a warning note (“the Hungarian population is getting into debt at breakneck speed”), but did not link the two phenomena — drawing down savings and rising indebtedness. Portfolio’s preview of a conference on euro adoption framed the topic as a strategic question, built around the expected statements of the central bank and the government.

In the left-liberal and mainstream public-affairs band, HVG used the productivity data as a political mirror: the headline (“The Tisza government would be very happy with this Polish or Romanian figure”) turns the inherited gap towards the government, while the text quotes the finance minister’s speech at the economists’ annual congress about the exhaustion of the previous economic model. 444.hu published two substantively rich reports from the economists’ congress. One carried State Secretary Gyula Barabás’s arguments for the euro, the size of the interest burden, and academician Péter Halmai’s proposal for a “front-loaded” consolidation — weighted towards the start of the term. In the other, former finance minister Péter Oszkó stated that labour supply can no longer be expanded, only productivity, and that in the sector that received the most subsidies productivity deteriorated over fifteen years. The outlets of the conservative band did not provide any article on this topic in today’s press monitoring, so no critical counterpoint to the government’s liquidity message from this band could be identified today.

6.2 Facts and data

Datum Value Source
KESZ balance, September 2026 more than 5,000 billion forints Finance Minister András Kármán, Portfolio, 12 September 2026
KESZ balance when the government took office below 1,000 billion forints Finance Minister András Kármán, Portfolio, 12 September 2026
Cumulative deficit of the central subsector, January–August 5,169.1 billion forints (of which EU pre-financing: 2,186.9 billion) Ministry of Finance, 8 September 2026
Growth of productivity per hour worked since 2010 Hungary 22%, Poland 55%, Romania 61%; the Hungarian figure exceeds the Czech one by 2 percentage points (pp) Eurostat, as reported by HVG, 12 September 2026
Growth of productivity per hour worked since 2020 Hungary 6% — among the weakest in the region Eurostat, as reported by HVG, 12 September 2026
Gross cash interest expenditure on public debt, 2025 around 4,200 billion forints; nearly 4 per cent of GDP State Secretary Gyula Barabás, 444.hu, 10 September 2026
Draft 2027 budget and medium-term plan to be published in the second half of October State Secretary Gyula Barabás, 444.hu, 10 September 2026
Housing-purpose pension fund withdrawal claims, 2025 125 billion forints submitted, 105 billion paid out (the original government estimate was 300 billion) MNB Aranykönyv, Portfolio, 12 September 2026
Change in voluntary pension fund assets, 2025 +150 billion forints; at the ten largest funds from 1,962 to 2,125 billion forints MNB Aranykönyv, Portfolio, 12 September 2026
Median net return of the ten largest fund portfolios 1 year: 10.7%; 10 years: 6.5% a year; 20 years: 6.4% a year MNB Aranykönyv, Portfolio, 12 September 2026
Annual growth of household debt 20%; 30% for housing loans MNB statistics, Portfolio, 3 September 2026

Two data points require a separate note. The announcement did not give the monthly time series or the source breakdown of the KESZ balance, so the comparison with the cumulative deficit was made on the basis of the financing identity, not from itemised data. The productivity figures are relayed by HVG; an item-by-item check against Eurostat’s original data table is recommended, because the article partly discusses the per-capita and per-hour-worked indicators together.

6.3 Policy dimensions

  • Economy (programme points) — the source breakdown of the Treasury buffer and productivity as a budget target indicator: G1 (data-driven budget) provides the disclosure frame, G23 (public-debt sustainability framework) the analysis of the buffer’s financing cost, G24 (institutional quality index) the institutional conditions of productivity, and G22 (financial-stability monitoring) the monitoring of accelerating household lending;
  • Social policy (programme points) — the long-term price of the housing-purpose pension fund withdrawal: it affects the supplementary pension savings pillar of SZ13 (pension adequacy and sustainability);
  • Employment policy (programme points and background material) — the link between productivity per hour worked and wage convergence: FO9 (productivity movement) is the instrument for raising productivity at firm level.

6.4 Literature in detail

6.4.1 Daron Acemoglu: Introduction to Modern Economic Growth

The first chapters of Acemoglu’s textbook start from the question of why differences in income per capita and labour productivity between countries are so large. The author distinguishes the proximate causes of growth — the accumulation of physical capital, human capital and technology — from the fundamental causes, which explain why some societies accumulate more capital and adopt new technology faster. Of the four possible fundamental causes — luck, geography, culture, institutions — the book’s fourth chapter sets out the empirical argument that income differences are caused primarily by differences in economic institutions. The comparison of South Korea and Nigeria, and of the two Koreas, shows that even with the same culture or favourable natural endowments, the security of property rights and investment incentives are decisive. Later chapters of the volume also discuss the link between technology adoption and the holdup problem: if the investor cannot trust that the return on the investment will stay with them, technological upgrading does not happen.

In this frame the Hungarian productivity data are not about the performance of workers but about how far the institutional environment of the economy has encouraged efficiency-enhancing investment. If since 2010 Polish and Romanian productivity per hour worked has grown two and a half times as fast as Hungarian productivity, the question is not how much people worked but under what institutional conditions. That is why MIAK proposes that, alongside the productivity target indicator, the G24 institutional quality index also be part of the medium-term plan: the proximate cause must be measured, but action must target the fundamental cause.

📖 Source: Daron Acemoglu: Introduction to Modern Economic Growth

6.4.2 International Monetary Fund: World Economic Outlook 2024

The IMF’s October 2024 report attributes weakening medium-term growth prospects to slow productivity growth and the slow pace of structural reforms in emerging economies. The report’s policy chapter directly links the questions of fiscal space and productivity:

“For countries with limited fiscal space, the reallocation of spending toward initiatives that support and enhance productivity and competitiveness can stimulate economic growth and release some of the pressure on overall spending. […] Strong commitments, clearly defined medium-term fiscal policy plans, clear communication of objectives and policy rationale, and careful sequencing […] are essential”

In the same place the report records that restoring depleted fiscal buffers requires a carefully calibrated consolidation path. Adjustment that is delayed too long can create market pressure, while adjustment that is too front-loaded hurts economic activity and vulnerable groups in society. To raise productivity it considers targeted reforms necessary in healthcare, education, the labour market, competition and digitalisation.

This gives two lessons for the Hungarian situation. First, by the report’s logic rebuilding the KESZ buffer is a justified step, but its credibility comes from a clearly communicated medium-term plan, not from the size of the buffer. Second, in the October medium-term plan spending cuts and productivity-targeted spending are not opposites: according to the report it is precisely narrow room for manoeuvre that makes it necessary for productivity items to be flagged and protected.

📖 Source: International Monetary Fund: World Economic Outlook 2024 — Policy Pivot, Rising Threats

6.4.3 Ha-Joon Chang: 23 Things They Don’t Tell You About Capitalism

Several chapters of Chang’s book dispute the common view that a country’s productivity is the sum of individuals’ skills or entrepreneurial energy. In the chapter on education he argues that the relationship between education and national productivity is weaker and more complex than public debate assumes. In his view, rich and poor countries are distinguished less by how educated their citizens are than by how well they organise them into high-productivity firms, and by the institutional system — a financial system encouraging investment, trade regulation, training background — that supports these firms. In the chapter on entrepreneurship he formulates the same idea through the role of collective institutions: the ability to build effective organisations matters more for prosperity than individual talent.

This appears particularly sharply in the Hungarian data. According to Péter Oszkó’s remark at the economists’ congress, in the sector that received the most state subsidies productivity deteriorated over fifteen years. The battery and automotive industries were largely integrated into the economy as assembly sites, not as corporate networks accumulating knowledge and organisational capability. Chang’s argument warns that the productivity target cannot be met through training programmes alone. Among spending priorities, the organisational development of domestic firms and supplier integration must be flagged — which is why MIAK also links the target indicator to the firm-level programme of FO9.

📖 Source: Ha-Joon Chang: 23 dolog, amit nem mondtak el a kapitalizmusról (23 Things They Don’t Tell You About Capitalism)

6.5 International comparison

The most direct model for disclosing Treasury liquidity is the US Treasury’s Daily Treasury Statement, which reports the account’s closing balance broken down by daily receipts, outlays and debt issuance. The Hungarian proposal is more modest, asking for monthly frequency. The essence, however, is the same: alongside the balance, the source of the change is also public, so growth in the account cannot automatically be read as a fiscal improvement. Several European debt management agencies also fix a target level for the cash buffer they hold as part of their financing plan, typically tied to a few months of gross financing needs. This allows the size of the buffer to be a matter of rules rather than of political messaging.

The EU practice provides a frame for institutionally treating productivity as a policy target indicator: in 2016 the Council of the European Union recommended — addressed primarily to euro-area member states, while encouraging the others — the establishment of national productivity boards that monitor the development of productivity and competitiveness in independent analysis. Within the region, according to the Eurostat data reported by HVG, Poland and Romania achieved the fastest improvement. MIAK proposes using this not as a model but as a comparison yardstick. Starting levels, economic structure and the use of EU funds differ by country, so the point of the target indicator is not to set a date for catching up but to measure the distance publicly every year.

Economy

  • G1 — Data-driven budget
  • G22 — Financial-stability monitoring and shadow-bank regulation
  • G23 — Public-debt sustainability framework
  • G24 — Institutional quality index — growth precondition

Social policy

  • SZ13 — Pension adequacy and sustainability

Employment policy

  • FO9 — Productivity movement — workplace innovation incentives

Proposed new programme point: Monthly Treasury liquidity and financing statement, with a productivity target indicator in the medium-term budget plan — for the Economy area: a monthly, machine-readable source breakdown of the KESZ balance, publication of the net financing requirement and the committed buffer level, and mandatory inclusion of the regional comparison of GDP per hour worked in the medium-term plan and the final accounts.

6.7 List of sources

Press sources (MIAK press monitor, 13 September 2026 — topic 4):

Knowledge-base references (books):

  • 📖 Daron Acemoglu: Introduction to Modern Economic Growth
  • 📖 International Monetary Fund: World Economic Outlook 2024 — Policy Pivot, Rising Threats
  • 📖 Ha-Joon Chang: 23 dolog, amit nem mondtak el a kapitalizmusról (23 Things They Don’t Tell You About Capitalism)

MIAK internal materials:

  • MIAK policy area: Economy (background material)
  • MIAK policy area: Economy (programme points; programme point ID: G1, G22, G23, G24)
  • MIAK policy area: Social policy (programme points; programme point ID: SZ13)
  • MIAK policy area: Employment policy (background material and programme points; programme point ID: FO9)
  • MIAK press monitor, 13 September 2026 — topic 4, score: 83/100

Supplementary public data sources:

  • Eurostat — labour productivity and unit labour cost data table (nama_10_lp_ulc)
  • Hungarian State Treasury — monthly reports on the balance of the Single Treasury Account
  • Government Debt Management Agency — annual financing plan and its quarterly revisions
  • Hungarian National Bank — voluntary pension fund Aranykönyv (2025)
  • Ministry of Finance — monthly preliminary public finance report (8 September 2026)
  • Fiscal Council — opinions on the central budget and the medium-term plan

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