EU funds
Hungary to test out hybrid grants before next EU budget cycle
Preparing for the next budget period of the EU, the government compiled a 11-point plan to be implemented this year. This includes cutting red tape by extending the use of simplified methods for accounting tendering costs. Also, in the case of infrastructure projects by national or local governments, an independent value analysis will be introduced, which at first look appears to be a major move towards the more rational use of EU funds.
According to Világgazdaság, the Finance Ministry is working on a special tender scheme, a non-refundable loan that will also act as a forerunner or pilot run for the 2012-2027 period. Under this setup, if grant winners perform the 12-month project implementation phase without problems, 10% of the funding originally received as a loan will not have to be repaid. Then if the grant winner continues to develop along various indicators in the following three-year maintenance period, the remaining 90% will also be waived, transforming the loan into a non-refundable subsidy. Also, even if the loan has to be repaid, it will carry a 0% interest rate.
According to Világgazdaság, the Finance Ministry is working on a special tender scheme, a non-refundable loan that will also act as a forerunner or pilot run for the 2012-2027 period. Under this setup, if grant winners perform the 12-month project implementation phase without problems, 10% of the funding originally received as a loan will not have to be repaid. Then if the grant winner continues to develop along various indicators in the following three-year maintenance period, the remaining 90% will also be waived, transforming the loan into a non-refundable subsidy. Also, even if the loan has to be repaid, it will carry a 0% interest rate.
This article is part of the work programme titled "The impacts of EU cohesion policy in Hungary - Present and Future" which is carried out by Net Média Zrt., the publisher of Portfolio.hu, between 1st April 2019 and 31st March 2020 with European Union financing. The views in this article solely reflect the opinions of the author. The European Commission as the funding entity does not take any responsibility for the use of information presented in this article.
