The head of Hungary’s new agency charged with rooting out everything from shady public contracts to outright fraud said Prime Minister Viktor Orban’s system isn’t corrupt, it’s individuals who are.
(Bloomberg) — The head of Hungary’s new agency charged with rooting out everything from shady public contracts to outright fraud said Prime Minister Viktor Orban’s system isn’t corrupt, it’s individuals who are.
Ferenc Biro, president of the Integrity Authority, said he’s assembling an “elite group” in the fight against graft, key to unlocking billions of euros in European Union aid needed to reinforce a crumbling economy. Biro plans to hire scores of specialists in the coming weeks to help harness technology to detect fraud, he said in an interview in Budapest.
But for all the ambition, the question is whether the agency has the power to act in a nation whose leader saw no need for it and yet where corruption is at the heart of the standoff with Brussels. The Integrity Authority can suspend public procurements and force state authorities to re-examine suspect cases. It can’t lead a criminal investigation or press charges.
Biro opposes drawing equivalence between the corruption and the government. He also challenges the notion that graft is a bigger problem in Hungary than elsewhere, saying much of it is based on perception that’s hard to quantify.
“It’s not the system that’s corrupt, it’s individuals,” Biro, who specialized in anti-fraud cases at international consultancies, most recently PricewaterhouseCoopers LLP, said on Jan. 12 at his office. “The agency will work to eliminate corruption and improve perception.”
The comments contrast with criticism from the EU, which has specifically said the procurement process under Orban’s government suffers from “systemic deficiencies and irregularities.”
Biro’s work is reliant on existing state structures, including the chief prosecutor, who is a former member of Orban’s ruling party. It also makes Hungary stand out from countries such as neighboring Romania or Croatia where anti-corruption specialists work as prosecutors.
“The Integrity Authority’s goal isn’t to press charges but to help foster a change in economic culture and to reduce corruption,” Biro said. The agency “can’t function as an island” and will need to work with other state bodies to get results, he said. “One can’t fight a problem of this proportion alone.”
Reining in Orban and what the European Parliament calls his “electoral autocracy” has become more critical to the EU, which has redoubled efforts to shore up unity within the bloc after Russia’s invasion of Ukraine. Graft concerns were at the core of the EU’s decision last month to effectively withhold almost $30 billion of Hungary’s funding.
The government set up the Integrity Authority reluctantly in the hope of appeasing the EU enough to get money. What remains to be seen is whether it’s a sign of a newfound drive to crack down on corruption or a facade. Orban told state radio on Jan. 13 that his country could do without the EU financially, “though of course it’s easier with them.”
Under Orban, who won a fourth consecutive term last year, the nation has plunged in Transparency International’s Corruption Perceptions Index and now ranks the second-lowest in the EU, after Bulgaria.
Frequent criticism centers around Orban’s influence and that of his allies, in power since 2010, in creating a new class of politically connected ultra-wealthy entrepreneurs via government contracts, state assets as well as subsidies and loans, including to the premier’s own family.
Hungary entered a stage of “state capture” years ago, according to Transparency International, with the government fostering corruption instead of stopping it. Orban and his ruling Fidesz party consistently reject the allegations.
The Integrity Authority plans to employ more than 100 people by the end of March compared with 20 staffers currently, including newcomers charged with helping build a “beyond state of the art” IT system, according to Biro. The aim is to detect suspected corruption in real time, including by flagging anomalies in procurements before winners are declared and money is wired.
Biro acknowledged that getting the system up and running may take several years — time he may not have with billions of euros in suspended EU funds hanging in the balance.
“If it counts as a surprise that we’ll work diligently toward our goal, then we’re here to cause a surprise,” he said. “We’re trailblazers and we’re in uncharted territory.”
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