„Mr. Orban said his government plans to announce a series of measures in February aimed at shrinking spending on pensions, unemployment benefits and state subsidies for drugs. He said the era of generous and long-lasting welfare benefits for the unemployed »is over.« But he said he didn't yet have estimates for how much money these moves would save the government.
Markets have been hoping that the February initiatives will provide evidence of concrete and enduring cuts in state spending.
Last year, Mr. Orban scorned calls from the IMF and EU for serious cuts in state spending. Instead, he stuck to his election promises of no new austerity measures and moved to cut personal income taxes and lower tax rates on small and midsize businesses.
To pay for this and still meet EU-required budget-deficit targets, he has slapped hefty temporary taxes on a handful of industries whose major players are large, foreign companies. He has also diverted a huge sum of privately managed pension money back into state coffers.
Mr. Orban said his approach aims to spark growth and create jobs in an economy recovering from its worst recession since the end of communism in 1989. »It's legitimate for Hungary to have its own view, to think not just about budget deficits, but about long-term competitiveness,« Mr. Orban said. Still, he acknowledged market pressures: »The fight for credibility is a constant fight.«”