2. Reviewing the development process of Hungary’s NACS 2023-2025
This chapter analyses the development process of Hungary’s draft National Anti-Corruption Strategy 2023-2025. It explores Hungary’s consultation process during the development of the NACS and suggests that process could be broadened to improve ownership and transparency ahead of adoption. It also examines and makes recommendations for strengthening Hungary’s situation analysis to better identify the problems and opportunities in Hungary’s fight against corruption. And it assesses the NACS’s complementarity with other strategies and suggests that Hungary should take steps to harmonise and avoid duplication between its strategic documents.
The process of developing a national anti-corruption strategy is widely seen to be equally important as the resulting strategy itself (OECD, 2020[1]). An inclusive and rigorous strategy development process can help select relevant strategic objectives that are meaningful to citizens and businesses, prioritise and sequence actions in an open manner to address the most crucial integrity risks, provide the necessary evidence for the interventions that are most cost-effective and likely to have the greatest impact and promote the sense of ownership and commitment to the stated goals and activities (OECD, 2020[1]).
Hungary committed in remedial measure No.3 (Strengthening the Anti-Corruption Framework) and in its Recovery and Resilience Plan to prepare the Medium Term National Anti-Corruption Strategy for 2023-2025 (hereinafter referred to as NACS) in dialogue with relevant stakeholders and with the involvement of the national Anti-Corruption Task Force, following consultations with national and international stakeholders, including the OECD, the European Commission and the Council of Europe, and in dialogue with stakeholders on the incorporation of their recommendations. Considering this commitment, this section provides an overview of the process undertaken to develop the current version of the NACS as well as recommendations to ensure an inclusive and rigorous development process of the final strategy.
2.2.1. Undertake a broader consultation process both internally and outside of government to promote ownership and improve transparency before adoption
To help build a common vision, increase the legitimacy of the strategy and augment support for it both within the public sector and wider society, it is recommendable to include a broad range of voices in the development process of the national anti-corruption strategy (OECD, 2020[1]). This includes several voices within the public sector, but also more broadly from the whole of society (the private sector, academia, civil society organisations and citizens). Table 2.1 presents the key criteria for inclusive and transparent intergovernmental and public consultations according to the OECD Public Integrity Indicators.
Considering that various agencies, departments and units across different branches of government have responsibilities when it comes to implementing a national anti-corruption strategy, international good practice emphasises that its development process should ensure the appropriate inclusion and participation of actors responsible for carrying out the different elements of the strategy (OECD, 2020[1]; G20, 2021[3]; UNODC, 2015[4]). Consultations should extend not only to the political leadership of the various implementing agencies, but also to the technical staff who will play a key role in implementing the strategy. Consultations could also benefit from valuable inputs from the business community, civil society organisations, the media, academics and the public in general. Such a broad participation process offers transparency, by allowing a multi-stakeholder approach to the strategy, and promotes ownership, acceptance and active support, all critical elements for such a national anti-corruption strategy to succeed.
When steering such a process and then drafting a strategy that involves several bodies, such as the NACS, one option is to assign to a small committee the primary responsibility for elaborating the draft strategy document and granting it a reasonable degree of autonomy in developing the draft. Such committee should be composed of representatives from the relevant public bodies (OECD, 2020[1]; UNODC, 2015[4]), because the drafting body should have sufficient stature and legitimacy to act as an effective “champion” for the drafting stage and ultimately for the strategy itself. Representatives from the business sector and civil society may also be invited to participate in this committee, either as full members or observers.
The current version of the NACS was prepared by the Ministry of Interior and the National Protection Service (NPS), with assistance from the Ministry of Justice in the latter stages of drafting. Since 2014, following a restructuring within the Hungarian government, the NPS has been responsible for co-ordinating anti-corruption work in Hungary, including drafting strategic documents and overseeing the implementation of their measures.
Officials in the NPS said during consultations with the OECD that the current version of the NACS was developed collaboratively with different ministries and public organisations (for instance the courts or the Public Procurement Office). The NPS reviewed previous strategies to develop a better sense of which intervention areas and actions should be included in the NACS. It analysed internal statistics and reviewed recommendations and best practice set by international organisations to determine the scope of the NACS. This collaborative approach to developing the draft NACS is positive, but Hungary could undertake further intra-governmental consultation with specified mechanisms for participation, in order to incorporate the widest possible range of views on the strategy’s development. It may also improve confidence in the finished strategy and accountability among relevant public authorities, if some commentary on the consultation process (in terms of how it was undertaken and why it produced the results it did) was included in the NACS.
Officials from the Ministry of Justice and the National Protective Service also said in consultations with the OECD that there is a legal requirement in Hungary for all draft laws to undergo public consultation. However, there is no legal requirement for the NACS to undergo public consultation, although it will be adopted by a government decision. Instead, the Anti-Corruption Task Force, through its civil society members, will provide the mechanism for gathering views on the strategy from outside of government. The Task Force is currently assessing the draft NACS and will publish a special report on the NACS by 1 June 2023.
This engagement through the Task Force is positive. However, in spite of there being no legal requirement to do so, there is scope for Hungary to undertake a wider public consultation to gather the fullest possible range of views, in line with the OECD Recommendation on Public Integrity, (OECD, 2017[5]). This is especially the case since the Task Force’s civil society members have said they do not represent wider public opinion, only the points of view of their respective organisations (Atlatszo, 2023[6]). Although Hungary does not have much time before adopting the NACS, the NACS and AP could be improved if Hungary invited representatives from government entities responsible for the implementation of the strategy and from business or professional associations, civil society organisations and academia to participate in further consultations. For example, Hungary could organise a short series of bilateral or multi-lateral meetings to allow invited participants to contribute to the policy design, drawing on examples of international best practice as set out in Box 2.1. Doing so would improve the problem analysis in the NACS, could highlight new ways of solving the challenges in the anti-corruption framework, and may more effectively deliver the NACS’s stated intention to develop a ‘whole-of-society’ approach to fighting corruption.
Broad consultations for the design of the National Anti-Corruption Action Plan (NACAP) 2022 - 2025 in Greece
In Greece, the lack of consultations in the National Anti-Corruption Action Plan (NACAP) 2018-2021 was identified by the EU as a major setback during the implementation and monitoring phases. As a result, the actions of the previous Action Plan were not always clearly defined, and, in many cases, there were no appointed focal points. These conditions made the monitoring of the implementation progress, as well as the evaluation of NACAP 2018-2021, extremely challenging.
In designing the new NACAP 2022-2025, the National Transparency Authority (NTA) in Greece was primarily concerned with including all relevant stakeholders early in the design process, in order to create ownership of the NACAP’s strategic objectives and structure, and to consult them while choosing and describing the actions to be included. The NACAP 2022-2025 was developed with the participation of various stakeholders, following an extensive consultation process. More than 44 meetings took place with 24 stakeholders during the second semester of 2021, with the participation of public policy stakeholders and representatives from the private sector and civil society. The meetings were held between May and November 2021 and included, as a first step, a joint assessment and interpretation of the results obtained from the implementation of the actions of the previous NACAP, both for the agencies involved and for each distinct group of beneficiaries (public administration, citizens, businesses). To develop the actions as specifically as possible, during the design phase, a three-page standardised document – an action Identification Fiche – was prepared for the description of each action. The identification fiche includes all the main elements: who is the stakeholder, the descriptive analysis of the action, which will be the necessary steps for the implementation of the action, the deliverables, and the outcomes. During the consultation phase, and after having generally agreed upon the actions to be included, an Identification Fiche was completed for every action by the stakeholders with guidance from the NTA. In addition to collaborative development of actions, the Identification Fiches are expected to provide necessary information for every action included in NACAP as a point of reference during the implementation and monitoring phase.
Civil society involvement in the drafting of an integrity strategy and its implementation in the Netherlands
The Platform for Corruption Prevention in the Netherlands provides an example of how various stakeholders, including civil society organisations (CSOs), can be involved in implementing an anticorruption strategy, as well as in helping design future strategies. Beyond public institutions, representatives from business and civil society were invited. These representatives were from private integrity and investigation services; the corporate risk and security management services of multinationals; the Association of Chambers of Commerce; the Association of Business Enterprises; Transparency International Netherlands; journalists; and academia. The meetings allowed participants to exchange expertise and experiences with anti-corruption developments in the Netherlands, and to share contributions to policy design and implementation, identification of corruption risks, research and training.
Source: European Commission (2023[7]), Handbook of good practices in the fight against corruption; Centre for the Study of Democracy (2014[8]), Civil Society Involvement in Drafting, Implementing and Assessing Anticorruption Policies: Best Practices Manual.
Finally, all supporting documentation regarding the public consultation process could be made available to the public to ensure an informed participation of relevant stakeholders. This could include, for example, results of regulatory impact assessments or information relating to exchanges between relevant government bodies. It should also be made clear how comments and feedback provided by the public, the private sector and the civil society organisations were considered in the final version of the strategy, including explanations for those comments that were not taken on board. For example, Hungary could publish online the minutes of the consultation meetings proposed for the finalisation of the draft NACS, as well as a summary sheet with responses as to how the stakeholders’ comments were addressed (OECD, 2023[2]).This kind of openness and integrity matter for trust in government. Governments’ actions to strengthen individuals’ ability to participate in politics, and improve perception of meaningful opportunities to participate among those who are sceptical, will help to improve trust (OECD, 2022[9]).
2.2.2. Strengthen, clarify and streamline the problem analysis underpinning the six intervention areas of the Action Plan
To be effective, a national anti-corruption strategy should be based on an accurate assessment of the problems and their causes, as well as the challenges and opportunities that the country faces in combating corruption (OECD, 2020[1]). This preliminary diagnosis, sometimes termed “problem analysis” or “situation analysis”, consists of two main elements: an assessment of the nature, extent and impact of the country’s corruption problems and risks, and an assessment of the opportunities and obstacles that may facilitate or hinder the implementation of effective anti-corruption reforms. Table 2.2 shows minimum standard of good practices to develop evidence-based strategies.
In its current version, the NACS contains several sections – sections 2, 3 and 5 – which provide helpful explanations of the current state of the public integrity system and the anti-corruption reforms undertaken by Hungary in recent years. These sections usefully set out the range of rules-based and values-based measures Hungary uses for combating corruption, along with the individuals and organisations involved in implementing them. However, the current drafting of the NACS makes these elements appear a little siloed, and these sections may benefit from a greater sense of how the individual elements described work together to form an overall framework for combating corruption. Doing so may make clearer how the system currently works, where the gaps or overlapping competencies might be, and where the opportunities for improvement are.
The current draft could also be clearer on what the specific problems, challenges/opportunities and gaps are in practice and how these could hinder or foster the implementation of the NACS. For instance, Chapter 2 provides information on how the Integrity Decree – Government Decree No. 50/2013. (II. 25.) – introduced the function of the integrity advisor and made it obligatory for all state administration organs, with a few exceptions, to appoint such an officer. It fails, though, to provide an assessment of the challenges and opportunities that such an arrangement could offer for the effective implementation of the NACS or how the NACS could further strengthen these integrity advisors. This assessment could be supported through surveying integrity advisors, separately from their annual reports, to draw on the experiences and insights they have gained through having been in place for almost a decade.
Moreover, these sections contain several normative statements on what countries could or should do to mitigate integrity risks and strengthen the fight against corruption. However, it is not clear whether some of these statements correspond to concrete issues and actions identified as priority areas of intervention in Hungary, or to general statements used as part of the analysis. For instance, Section 5.6 states that small and medium-sized enterprises should be involved in public procurement to enhance competition, but it is not clear whether this is a concrete action identified as a priority area to work on in the context of the NACS or just a general normative statement.
In addition, some of these normative statements are contradicted or challenged by recent evidence from research and practice:
Experimental evidence from behavioural sciences (Box 2.2) leads to reconsider some normative statements included in the NACS related to ethical decision-making in general (e.g. Section 4.2.1.1 stating that “All ethics-related decisions are, ultimately, a matter of the individual’s conscience”), on the relevance of training and target groups (Section 5.2 “Regularly repeated training is the most effective means of enhancing integrity awareness” and Section 5.3 “Particular attention should be paid to the provision of such training for top leaders, particularly for those in high positions”) and on awareness raising (Section 5.7: “It has been proven by multiple research studies that it is by keeping the topic on the agenda and returning to it again and again, that lasting results can be achieved in awareness raising towards corruption prevention, a highly sensitive matter”). This new evidence also questions some of the standard approaches and anti-corruption measures.
The normative statement linking transparency to trust (Section 4.2.3.3 “Enhancing the already available access to information of public interest also contributes to growing public trust”) is not automatic. While transparency can indeed promote trust, citizens also need to trust the information and the institutions that are providing it, making the relationship less linear than often stated. If citizens do not trust the information provided or feel that there are no credible responses from the government, more transparency may lead to cynicism (Bauhr and Grimes, 2014[10]). Promoting trust therefore requires a more sophisticated strategy and analysis of the drivers of trust in a given context (OECD, 2022[9]).
The NACS emphasises that reporting can be promoted through training and competences (Section 4.2.1.3). While knowledge about reporting channels and protection mechanisms may indeed help, the NACS could place greater emphasis on the relevance of trust in the system. For instance, the results from the Global Corruption Barometer 2021 indicate that only 34% of Hungarian citizens would not fear reprisals when reporting incidents of corruption (against an average of 47% in the European Union) (Transparency International, 2021[11]).
Behaviours matter. Change requires that people start doing things differently. As such, policymakers need to understand better what drives our behaviour. The innovative potential of incorporating the human factor with its psychological, cognitive and social dimensions into integrity policies is now widely acknowledged. Nonetheless, human behaviour is often still an underappreciated dimension in the formulation of integrity policies, which tend to focus on legal and institutional reforms. To bridge this gap, the OECD report on “Behavioural Insights for Public Integrity” links relevant insights from behavioural research to anti-corruption and integrity policymaking (OECD, 2018[12]).
Three key messages emerge from these behavioural insights for public integrity:
1. Independent from the context, most people want to act with integrity. At the same time, they may engage in unethical practices while still managing to feel being an honest person (Cohn et al., 2019[13]; Shalvi et al., 2011[14]; Fischbacher and Föllmi-Heusi, 2013[15]). This has implications for law and policymaking (Feldman, 2018[16]). Traditional anti-corruption measures focus almost exclusively on the corrupt individuals. By doing so, the costs of the anti-corruption measures on the non-corrupt have been largely neglected. Policymakers should focus more on supporting ethical decision-making by providing an enabling environment and trust (Lambsdorff, 2015[17]). As ethical choice is often unconscious, capacity-building and tools may not be enough to promote actual ethical decisions.
2. Social norms matter in shaping our choices (Bicchieri, 2017[18]; Bicchieri, 2005[19]) (Bicchieri, 2017[18]; Bicchieri, 2005[19]). People behave according to the beliefs and expectations of what is acceptable within their social context. Integrity reforms may fail if they do not consider existing social norms that may not be aligned with formal regulations and procedures. Again, instead of focusing on bad behaviours and thereby potentially reinforcing existing social norms, making visible good behaviour to promote cultures of integrity could be the key to success. At organisational levels, middle management leaders could play an important role in achieving this (OECD, forthcoming[20]).
3. Integrity policies, even when well-intentioned, may not always deliver the desired impact or may even backfire when people do not react as expected. In particular, when designing awareness raising campaigns policymakers need to consider how the messages conveyed may contribute to unintentionally normalising corruption in the target groups (Corbacho et al., 2016[21]; Ajzenman, 2021[22]; Peiffer and Walton, 2022[23]). Instead of making assumptions or desiring how people would or should behave, observing and understanding actual behaviour should be the starting point. Also, piloting before upscaling is key. The understanding of cognitive biases and heuristics has improved; they can be predicted and thus factored-in when designing policies.
Source: OECD elaboration.
The draft NACS also contains helpful sections at 2.3, setting out definitions of terms in the fight against corruption, and at Section 2.4, setting out basic principles for the fight against corruption. Officials in the Ministry of Justice and NPS explained during consultations with the OECD that many of these definitions are lifted from relevant legislation. Others are drawn from academic and international research and recommendations. These definitions will be reviewed and, where necessary, amended by the Anti-Corruption Task Force as part of its assessment of the draft NACS in its first annual report. These sections on definitions could be improved by making clearer where the definitions are drawn from and offering some justification for the definitions used, by, for example, consulting the academics and researchers whose work has been drawn upon. This approach could be especially helpful where new definitions, not previously set out elsewhere, have been developed.
In addition, the draft NACS’s use of evidence to assess the effectiveness of the current system, to support the problem analysis, and to prioritise and make the case for the changes proposed later in the document could be improved. There is a useful effort within Section 3.3 to present data from the National Tax and Customs Administration, the Police, and the Prosecution Service on current criminal corruption levels. Officials in the Ministry of Justice and NPS explained to the OECD that this data was presented because of its availability and because they wanted to focus on presenting official statistics. A similar explanation could be added to the draft NACS, to clarify why this data is used and why it is drawn from these public authorities as opposed to any others. A fuller analysis of the evidence presented in this section may also help to substantiate some of the conclusions drawn from it. At present, the data in this section does not, by itself, prove that the relevant authorities were more effective at addressing corruption cases than other offences.
Also, while reducing single-bid procurements is a target set by the EU, the draft NACS could make clearer what the evidence in Section 3.4 on single-bid procurements is intended to show, and could draw out the connection between reducing single-bid procurements and combating corruption more. In addition, more evidence / commentary could help to prove the causality between recently introduced measures and the observed decrease in the proportion of single-bid procurement transactions.
However, as well as explaining the evidence which is already there more effectively, the NACS could be significantly improved if a wider evidence base was used to support the problem analysis and prioritisation. As the OECD Recommendation on Public Integrity sets out, to effect change the full complexity of corruption needs to be understood. Influence trading, embezzlement of public property, use of confidential information and the abuse of power are just some of the more intrinsic corrupt acts that are the most harmful for society (OECD, 2017[5]), and the evidence base should therefore be broadened beyond criminal statistics data on corruption.
The Hungarian government set out in consultations with the OECD that there is a wealth of data across public sector organisations in Hungary on how the anti-corruption framework is performing. In many instances, this is not only raw data but is collated and assessed by public authorities on a regular basis. Much of this data could be used to provide a fuller picture of corruption and corruption risk in Hungary and how mechanisms designed to mitigate these challenges are working. Notable examples of this data collection and assessment include:
The State Audit Office (SAO): Between 2011 and 2020 the SAO mapped integrity and corruption risk at public institutions as part of an integrity project supported by the European Union. Since then, public bodies have started to provide a self-evaluation, which the SAO uses to conduct a risk assessment and determine which public bodies will be audited. The SAO told the OECD that starting in 2023 audits will not only look at whether required regulations are in place but also whether they are being implemented. The audits use the COSO model, are based on official records, findings of previous audits, data collection, and interviews. Hungary could use the SAO’s large, consistent data set, which covers a range of hard (i.e. prescribed in law) and soft controls (i.e. policy or values-based measures), to assess trends across organisations and over time and to develop a fuller understanding of the problems they face.
Integrity Advisers: Officials in the NPS told the OECD that 367 Hungarian public bodies currently have integrity advisers, which are the officials responsible for receiving and investigating notifications of poor behaviour, taking reports of corruption risk, and providing advice to public organisations’ management. Integrity advisers conduct an annual risk assessment survey through an anonymous platform which is submitted to the Ministry of Interior and published on korrupciomegelozes.gov.hu. Day to day, integrity advisers collect casework, including whistleblowing reports, in casework databases (one example of which described in consultations with the OECD included details of the case’s date, subject, and transmission to other relevant public bodies). Hungary could use information held by integrity advisers as good quantitative and qualitative evidence of corruption risk across public bodies. In particular, integrity advisers’ casework data could provide a more real-time evidence base than annual reports or audits.
Integrity Authority: Hungary committed in its remedial measures to reinforce prevention, detection and correction of illegalities and irregularities concerning the implementation of European Union funds through a newly established Integrity Authority. Act XXVII of 2022 thus gave the Integrity Authority powers to conduct assessments, investigations and audits in relation to the use of EU funds in Hungary. The Integrity Authority published a risk assessment of the public procurement system in March 2023. This report offers the NACS drafting authorities good insight into the challenges facing a key part of the integrity framework along with a solid sense of what specific measures could be taken to improve it. The Integrity Authority is also gathering data and plans reports over the coming year on the concentration of the public procurement market, the asset declaration system’s operation, and the Integrity Authority’s own risk assessment methodology. Hungary could reflect these data and reports in its monitoring and evaluation process to improve the NACS throughout its reporting period.
In addition to this internal data, Hungary could make fuller use of external sources in its problem analysis too. Doing so could generate further insights into the challenges facing Hungary’s anti-corruption framework and build public and implementing authorities’ confidence that the NACS’s objectives and actions are the right ones. Examples of external sources include:
The Eurobarometer, which explores the level of corruption perceived and experienced by European citizens, analysed at EU level, by country, and by socio-demographic category.
The European Anti-Fraud Office’s annual OLAF reports, which set out the number and types of irregularities and risks recorded in its investigations.
The OECD Public Integrity Indicators, which provide data on the preparedness and resilience of the public integrity system at the national level to prevent corruption, mismanagement and waste of public funds, and to assess the likelihood of detecting and mitigating various corruption risks by different actors in the system. More detailed information about the use of the OECD Public Integrity Indicators can be found at the start of the relevant following sections of the report.
Overall, a broader evidence base and improved use of evidence would be more useful for the problem analysis in the NACS. But it could also support the strategic prioritisation of the highest-risk corruption areas and make a stronger case for the six intervention areas of the action plan (Table 2.3).
International standards emphasise that a key to the success of any anti-corruption strategy is a robust diagnostic stage which, as set out above, can involve political economy analysis, stakeholder mapping, corruption risk assessments and other evidence gathering. (OECD, 2020[24]) (G20, 2021[3]) (UNODC, 2015[4]). The OECD Public Integrity Indicator 1.3.2 “Evidence-based problem analysis and use of diagnostic tools” reflects this international good practice and helps countries to develop an evidence-based problem analysis and use diagnostic tools to build upon such diagnosis (OECD, 2023[2]). With these best practices in mind, the NACS could benefit from a clearer connection between the problem analysis and the priority areas for action set out in the intervention areas, as other OECD countries have done (for an example see Box 2.3).
The United Kingdom Anti-Corruption Strategy 2017-2022 seeks to provide a long-term framework for ensuring a safer, more prosperous and more confident future based on concerted UK action against corruption. The strategy is informed by a detailed analysis of key corruption risk areas, based on data from the following sources:
1. Data of sociological surveys, such as the Ipsos MORI Veracity Index, 1993-2016, the Control Risk 2015 International business attitudes towards corruption, and the PWC 2016 Annual Global CEO Survey.
4. Results of the implementation of the 2014 UK Anti-Corruption Plan.
5. Analysis of the impact of anti-corruption laws in the public and private sectors, based on the results of the London Anti-corruption Summit of 2016.
6. Political and legal factors, such as the effects of Brexit or the leading role of the United Kingdom on pushing for a beneficial ownership transparency agenda, which details the efforts of the United Kingdom to implement international standards on anti-corruption.
Based on this situation analysis, the Strategy identifies priority areas for anti-corruption, including strengthening the integrity of the United Kingdom as an international financial centre; reducing the insider threat in high-risk domestic sectors; promoting integrity across the public and private sectors; reducing corruption in public procurement and grants; improving the business environment globally; and working with other countries to combat corruption.
Source: UK HM Government (2017[25]), The United Kingdom Anti-corruption Strategy 2017-2022, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/667221/6_3323_Anti-Corruption_Strategy_WEB.pdf.
Reviewing sections 2, 3 and 5 in the ways set out above could help to make a stronger case for the NACS’s strategic objectives, the approach to prioritisation set out in the intervention areas, and, likewise, the grouping of the six intervention areas presented in the Action Plan. It would ensure coherence between the problem analysis and the proposed strategic approach for improvement, and would help readers and implementing authorities to understand the underlying logic and theory of change within the NACS.
2.2.3. Set out how the NACS complements other strategies to address gaps, enhance coherence and avoid duplication in Hungary’s anti-corruption framework
Hungary committed to ensuring coherence between the NACS and the Strategy Against Fraud and Corruption for European Union Funds adopted by the Hungarian Government on 15 November 2022. To that end, the current version of the NACS was built based on the Strategy Against Fraud and Corruption for European Union Funds, in terms of form and content.
In terms of form, both strategies follow the same general structure – introduction, situation analysis, objectives, intervention areas, mechanisms to ensure implementation and action plan.
In terms of content, the objectives of the two strategies are aligned overall. In fact, the NACS in its strategic objective 4.2.6 on the protection of the European Union’s financial interests successfully reflects the strategic objective of the Strategy Against Fraud and Corruption for European Union Funds to effectively protect the financial interests of the European Union and Hungary. In addition, the action plan of the Strategy Against Fraud and Corruption for European Union Funds includes an activity (activity 2) consisting of reviewing the national anti-corruption strategy.
These strategies have different, though complementary, purposes. The Strategy Against Fraud and Corruption for European Union Funds aims to promote integrity, efficiency and transparency in the spending of European Union funds. The NACS aims to enhance awareness and responsibility regarding the fight against corruption across the whole of society. The NACS recognises that both strategies must be implemented in a co-ordinated way and potential synergies exploited to achieve their objectives. To that end, the NACS includes an action (Action 5.4) which commits to continuously scrutinise the co-ordination of the implementation of the actions of the Strategy Against Fraud and Corruption for European Union Funds and the NACS. This responsibility is awarded to the Minister of Regional Development, the Ministerial lead on EU funds.
Nevertheless, the alignment of the strategic objectives of the two strategies should be reflected in the design and implementation of their respective measures. To this end, certain NACS measures could be fine-tuned in accordance with the Strategy Against Fraud and Corruption for European Union Funds. In particular:
Action 5.1, which commits to the development of a proposal for mitigating integrity risks relating to major investment projects financed with public funds, could mention that the proposal will be based on the risk analysis and risk management processes described in the Strategy Against Fraud and Corruption for European Union Funds;
Action 5.9, which commits to the assessment of the categories of cases regarding which automation and electronic administration can be applied more extensively to further mitigate risks of corruption in administrative processes, could include administrative processes related to the use of European Union funds. This would be in line with measure 12 of the Action Plan of the Strategy Against Fraud and Corruption for European Union Funds about the continuous monitoring of the provisions regarding the data to be recorded and stored electronically for each operation;
Action 5.11, which commits to the State Audit Office (SAO) paying particular attention to the regularity of the use of supports and the execution of investment projects as well as the performance of tasks by budgetary organs and state / local government companies providing for the application of the law by authorities and public services, could explicitly mention that the SAO in carrying out its audits will also analyse fraud risks. This is in line with the SAO’s role as an institutional actor involved in the implementation of the Strategy Against Fraud and Corruption for European Union Funds.
In turn, the Action Plan of the Strategy Against Fraud and Corruption for European Union Funds requires in Activity 2 that the Strategy is reviewed in parallel to the development of the NACS. Therefore, some measures of the Strategy Against Fraud and Corruption for European Union Funds could be refined to better reflect the developments envisaged in the NACS. In particular, measures 8 and 10 of the Action Plan of the Strategy Against Fraud and Corruption for European Union Funds about the creation of a reporting interface on the website www.palyazat.gov.hu and the development of a public interest reporting system could be aligned with Action 5.5 of the NACS which commits to developing more effective measures for the protection of whistleblowers in accordance with Directive (EU) 2019/1937 of the European Parliament and of the Council on the protection of persons who report breaches of Union law. In practice, the two reporting systems1 provided for in the Strategy Against Fraud and Corruption for European Union Funds should provide reporting persons with the same protection measures envisaged under Action 5.5. of the NACS.
As mentioned above, the two strategies are different in content but together they aim to form a harmonised strategic framework. To ensure coherence, Hungary could undertake its own analysis before finalising the NACS to assess gaps and avoid duplication from an operational point of view which could impede implementation.
Hungary said in consultations that it also intends to assess how the NACS and AP will complement other strategies. This will include a comparison with measures to increase the level of competition in public procurement (2023-2026) based on the RRP, Hungary’s Convergence Programme 2022-2026, which aims to create a competitive business and tax environment and to stimulate investment by the Government, and Hungary's National Reform Programme 2023, which emphasises the anti-corruption strategy and focuses on transparency in public procurement and fair competition. Hungary will also include its National Framework Strategy for Sustainable Development (2012-2024), which states that it is essential to fight corruption, ensure compliance with standards, create stability in the state regulatory system affecting socio-economic relations, and strengthen the predictability of governance. The NACS should clearly set out the results of this analysis to show how the NACS relates to these other strategies to address gaps and build Hungary’s anti-corruption framework.
Additionally, the NACS should build on the 2020-2022 National Anti-corruption Strategy and the progress derived from its implementation. The OECD Public Integrity Indicators provide a measurement of this previous strategic framework. Figure 2.1 shows the indicators of the OECD Public Integrity Indicator for Principle 3 of the OECD Recommendation on Public Integrity (Strategy) for Hungary and the OECD average, following criteria established by the OECD Working Party of Senior Public Integrity Officials (SPIO). In this sense, Figure 2.1 shows that the 2020-2022 National Anti-corruption Strategy of Hungary follows good practice with respect to “coverage of the strategic framework”, “evidence-based problem analysis and use of diagnostic tools”, “quality of strategy”, “adequacy of implementation structures and reporting”, “implementation of activities” and “evaluation practices”. In all these indicators, and in “financial sustainability”, Hungary scored above the OECD average. However, the 2020-2022 National Anti-corruption Strategy could have been strengthened when it comes to “consultation in practice”. It could be worth reflecting (perhaps in the relevant paragraphs of Section 2.1 in the current draft of the NACS) on how the current draft of the NACS builds on the strengths and weaknesses of the previous Strategy and therefore develops Hungary’s ability to fight corruption. Doing so may help to demonstrate a more sustained strategic approach to combating corruption, recognising that anti-corruption work takes time and capabilities often develop gradually. As Civil Society Organisations have set out to the Anti-Corruption Task Force, the previous Strategy provides a good opportunity for Hungary to develop benchmarks which will help implementation of the new NACS and the improvement of Hungary’s anti-corruption framework to be tracked (for benchmarking and monitoring implementation through indicators see Sections 3.3.1 in Chapter 3 and 4.2.1 in Chapter 4).
Note: OECD countries used to calculate the OECD average include Australia, Austria, Belgium, Canada, Chile, Colombia, Costa Rica, Czechia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Türkiye, United Kingdom, and the United States.
Source: OECD (2023[2]), OECD Public Integrity Indicators, https://oecd-public-integrity-indicators.org/.
References
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Note
← 1. The reporting systems on the websites www.palyazat.gov.hu and www.antilop.hu, as described in measures 8 and 10 of the Action Plan of the Strategy Against Fraud and Corruption for European Union Funds.