The first public works programmes, which will serve as a model for later ones, are due to be announced on 1 July, and are due to start in September, said Deputy Prime Minister and Minister of Public Administration and Justice Tibor Navracsics at an economic forum in Veszprém on Thursday.
From 1 January it will be possible for public works personnel to be engaged at several levels, he added. He pointed out that this would not only be for large infrastructure construction projects, but also in agriculture.
The Deputy Prime Minister pointed out that in Hungary today one million fewer people are in employment than in the similarly-sized country of the Czech Republic, for example, and that there is no reasonable explanation for this difference. Dr. Navracsics stated that it is a highlighted policy goal of the Government to create one million jobs over the next ten years. At the same time he said that this is not necessarily a matter of creating new jobs. The Czech example shows us that the difference of one million is in part due to the fact that in Hungary fewer people are working legally than there. He said that successful economic policy is not only a question of quality, but of quantity also. He stated that the general level of a workforce’s education and the level of market efficiency are not the only criteria for success, but that it is also important how many people work. More people at work can create more value, he said.
According to the Deputy Prime Minister, economists ‘constantly mention demography as a question of social policy, yet it is also one of the most pressing problems from the perspective of economic development.’ He said that there is a need to review the pension and welfare systems, because in Hungary the proportion of those who are ‘economically inactive’ is extremely high. Among EU Member States, Hungary is in second to last place in terms of the population’s economic activity (ahead of Malta ). Dr. Navracsics said that the development of the economy can only be set on a sustainable and stable course if in the coming years ‘we slowly and steadily reach’ economic growth of 3-5 per cent.
He said that the New Széchenyi Plan and the Széll Kálmán Plan ‘seek to provide the basic elements that will make possible the more intensive movement of money already present in the economy.’ The leader of the Ministry of Public Administration said that it should be easier to gain access to development funding, and that public administration would operate more efficiently when ruling on funding applications.
Dr. Navracsics went on to say that the natural disaster in Japan will hold back that country’s economic growth by 3-4 per cent, and that this could also impact on the economy of the European Union. In his opinion the economic growth prospects for the EU will have to be lowered by around 0.5 per cent, to approximately half the previous prediction. The minister said that in such a situation, the value of a country’s political and economic stability appreciates to an ‘incredible’ extent, and in today’s Hungary economic stability is a given.
In order to maintain stability of economic policy and ‘external credibility’ the Government has set aside a budget reserve fund of HUF 250 billion for this year, the Deputy Prime Minister said.
He also pointed out that since last June a total of HUF 500 billion has been ‘taken out of’ the government sphere, which means that last year savings of two times HUF 120 billion were achieved. The aim of this was to keep to the 3.8 per cent budget deficit target, and to enable debt reduction for private enterprise to be distributed.
(kormany.hu)
