“Next year’s budget will provide assistance to those who want to move forward through work in Hungary; the budget places particular emphasis on job creation, supporting families and security”, Parliamentary State Secretary Csaba Dömötör from the Cabinet Office of the Prime Minister said at a press conference in Budapest on Tuesday. Minister of State for Labour Market and Vocational Education Péter Cseresznyés from the Ministry for National Economy pointed out that several areas will be receiving additional funding.

“The Government is introducing further measures in the interests of achieving full employment and would like its wage increase programmes to mean that everyone feels it is worthwhile to work”, Mr. Dömötör added. “According to the Budget Bill, the minimal wage will increase by a further 8 percent next year, and the minimum wage for skilled workers will increase by a further 12 percent, meaning the latter will have doubled since 2010”, he continued.

The further reduction of employer contributions within the private sector will also facilitate an increase in salaries.

The State Secretary also told reporters that the monthly tax benefit for families with two children would be increasing to 35 thousand forints, meaning the total benefit will increase to an annual 420 thousand forints according to the Bill. Young married couples will also continue to enjoy tax benefits. “The total sum of funding for families will have doubled compared to 2010”, he said in summary.

Mr. Dömötör stressed that increasing the country’s security will remain a priority goal, and the brutal events in Manchester also indicate that mass, uncontrolled migration continues to represent the continent’s greatest security risk, and must be handled. Next year’s budget will include all necessary funding for border protection, as well as for the continuation of the career model and wage increase programme for law enforcement personnel.

“The background for these measures is provided by the stable and expanding economy”, he highlighted.

Péter Cseresznyés spoke about the fact that the Hungarian economy had grown by 4.1 percent during the first three months of the year, and growth is also expected to exceed 4 percent next year. Public finances are stable and the resources required for the measures included in the Budget Bill are all available.

Next year, additional funding will be made available to several fields, including year-on-year increases of 97 billion forints and 217 billion forints for education and healthcare, respectively.

The additional funding provided to the healthcare system will primarily be spent on public health programmes, management optimisation, and improving nursing and health visitor services. Pensions, family support and social services will receive 287 billion forints in additional funding. Mr. Cseresznyés highlighted the home creation programme, which will have an available budget of 226 billion forints. The Budget also includes funding of 205 billion forints for economic development and 83 billion forints for law enforcement and improving public safety.

The Minister of State also highlighted the fact that tax cuts would also continue, including, amongst others, the reduction of the level of VAT on fish meat to 5 percent, a cut in the VAT on restaurant services from 18 percent to 5 percent, and the reduction of VAT on internet services.

“It is evident from the above that the benefit-based economy is being replaced by a work-based economy. Each year it is becoming more worthwhile for everyone to work, and it is for this purpose that wage increased and sectoral development projects are being realised”, he declared. Among the results achieved so far, Mr. Cseresznyés highlighted the fact that unemployment had fallen to 4.5 percent from 11.4 percent in 2010, as a result of which more people are now working in Hungary than at any point since the regime change in 1989. New programmes will also be launched within the framework of the Irinyi Plan to facilitate increased production on the part of SMEs, he announced. The significant increase in the minimum wage and the minimum wage for skilled workers is also leading to increases in the salaries of people in higher wage categories, he explained. Economic development and wage increases are being realised out of the national budget without the need to take on any loans.