EXCERPTS ON NEW HUNGARIAN STATE FINANCES FROM LEGAL, ECONOMIC AND INTERNATIONAL ASPECTS

Abstract

The Hungarian national economy, struggling with public finance debts, low efficiency in budgetary policy and a weak control potential, had reached a state of crisis by the middle of the 2000s, which deepened further by the time of the 2007-2008 crisis. From 2010 onwards, as opposed to the conventional crisis management method of the International Monetary Fund (IMF) and the European Union, which was based on budgetary restrictions, adjustments were made to the budget. In 2013, the Hungarian central bank, which did not use conventional crisis management instruments either, joined in, thus becoming an institutional part of the state financial system. It was confirmed that the central bank can help fiscal consolidation and growth potential while still being able to preserve its independence. Conditions were established for the – non-conventional – rules of both fiscal and monetary interventions within the highest level national regulatory framework of the law, compliance with which is ensured by legislative and institutional guarantees.