In 2014 the Hungarian press was loud about the conflict between the Hungarian Government and the EEA/Norwegian NGO Fund. The Hungarian National Tax and Customs Administration upon the official request of the Hungarian Governmental Audit Office suspended the tax numbers of the Operator Foundations of the EEA/Norwegian NGO Fund; at first the tax number of the Carpathian Foundation in September, 2014. Since then, the government’s action against the ‘Norwegian civic organizations’ was unsuccessful. Currently there is silence– or calm before the storm. Here comes a “brief and pithy” resume.
January, 2014
The Hungarian Government unilaterally changes the structure and the responsible institutional background of implementing and auditing the EEA/Norway Grants: without any previous announcement it abolishes the responsible institution, the National Development Agency, and relocates the implementation of the grant to the Széchényi Program Office Nonprofit LLC (an institution outside the state budget thus according to the agreement it cannot handle public money).
March, 2014
Janos Lazar, head Minister of the Prime Minister’s Office sends a letter to the Norwegian Minister of Foreign Affairs in which he asks the donors to reconsider the operation of the EEA/Norwegian NGO Funds. Nandor Csepreghy, Deputy State Secretary Responsible for Communications of Development Policy denominates the EEA/Norwegian Fund Operators as ‘putty clubs of party-related swindlers’. The consortium responds in an open-letter in which it invites Janos Lazar to clarify it.
May, 2014
Norway, Liechtenstein and Iceland suspended the operation and pay-offs of the EEA/Norway Grants in Hungary as they interpret the Hungarian Governments’ action (in which they reorganized the responsible institutional system and structure) as a unilateral breach of contract. However, donors do not suspend the EEA/Norwegian NGO Fund.
Even in the same month Nandor Csepreghy announces to the media that the Governmental Audit Office will audit the EEA/Norwegian NGO Fund. The members of the consortium receive the official notification about this audit only a week later. The Financial Mechanism Office at Brussels declares that this audit has no legal basis.
Several names of the Selection Committees of the EEA/Norwegian NGO Fund ((protected by confidentiality declarations) were leaked to the media.
June, 2014
The Governmental Audit Office visits the premises of the operator foundations and demands documents from them. The organizations dispute the legal basis of the audit but they do not get response. The Governmental Audit Office requests documents from the consortium at first and then directly from the concerned 58 organizations. The Office threatens with sanctions (penalty, suspension of tax number). The members of the consortium give over documents but only about the Fund’s general operation and financial management (invoices, vouchers, etc.). They do not give over documentation related to the successful and unsuccessful applicants and committee members (so any data that are sensible, influence the every-day-operation, and that are managed by the Financial Mechanism Office at Brussels).
July, 2014
According to Viktor Orban’s statement (the Hungarian Prime Minister) the Hungarian civils are “political activists who are paid by foreigners” and who “wish to influence the Hungarian public life at a given time and in given questions”.
Sept, 2014
Police raided the offices of the Hungarian Environmental Partnership Foundation, its accountant and IT partner, and at office of the Foundation for Development of Democratic Rights, and also at the home of one of the colleagues of the Hungarian Environmental Partnership Foundation. The Hungarian Tax and Customs Administration informs the consortium about the suspension of their tax numbers. All members submit appeals against the decree.
October-November, 2014
At a press conference of the Governmental Audit Office the audit results of the EEA/Norwegian NGO Fund were announced. The press compares the procedure to a show trial. According to the consortium it is impossible to respond to the accusations that are not confirmed by facts. The competent Norwegian Minister does not accept Janos Lazar’s invitation; according to his point of view there is nothing to talk about the NGO Fund and about the audit results. Ambassador, Tove Skarstein repeats that Norway does not accept the Governmental Audit Office’s audit. The organizations are “accused” by fraudulence, budget-cheating, counterfeit private agreements, and unauthorized financial activity by the Governmental Audit Office. The Norwegian Ambassador does not agree with these results; according to the agreement between the two countries the Governmental Audit Office have no legal basis to audit the EEA/Norwegian NGO Fund.
Supposedly, the Governmental Audit Office reports a crime based on the irregularities that were concluded in the report.
January, 2015
The result of the part-time audit of the Norwegian Financial Mechanism Office at Brussels concludes that the Fund is operating regularly.
In November (after more than 2 months) the Public Prosecutor’s Office refuses the Ökotárs Foundation’s complaint about the search thus they appeal to the Central District Court of Pest. 29 January, 2015 the Court determines that the search against the Ökotárs Foundation was illegitimate.
February-May, 2015
A request of the Governmental Audit Office initiates an audit of the Swiss-Hungarian Civic and Scholarship Funds because this was coordinated by the consortium, too. The Office did not find any irregularity; the Fund was frozen that made the operation of the grantees harder.
The lawsuit about the Foundations’ suspended tax numbers is running against the Hungarian Tax and Customs Administration. Eger town’s judge has recourse to the Constitutional Court for an official opinion.
May, 2015
The Carpathian Foundation – together with the other Foundations of the consortium – lodge an action against the Governmental Audit Office because of the “tort caused under the authority of public administration”.
June, 2015
The Capital City Prosecutor's Office carries out an audit by the concerned project promoters and concluded that their operation is legal and their activities comfort to the Hungarian regulations.
NOW
In October the Carpathian Foundation will be informed about the official opinion of the Constitutional Court that concludes whether the procedure of the Governmental Audit Office (suspension of tax numbers) is reconcilable with the Constitution of Hungary as there is no opportunity for remedies against this proceeding.
This decision will determine whether the civil organizations that are concerned in the proceeding will be able to continue their work or they will be erased from the Hungarian civic sector at the stroke of a pen.
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