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Hungary and Poland block EU budget plan

The European Union's largest recovery plan, known as the ‘stimulus package’, to help repair the economic and social damage caused by the COVID-19 pandemic is now in danger after both Hungary and Poland blocked approval of the 2021-2027 EU budget.

In July earlier this year, EU leaders gathered to adopt a stimulus plan. The long-term budget of €1.8 trillion in total hope to build a more environmentally friendly, digital and resilient Europe. The package will follow the new rule of law mechanism, which would stop funding in the case of money mishandling or breaking of EU principles. However, the plan must be approved by all 27 member states to be adopted.

According to the UN’s definition, the rule of law is the principle that: "All persons, institutions and entities, public and private, including the State itself, are accountable to laws”.

The addition of the new rule of law clause has sparked anger from the Hungarian and Polish governments. It is feared that this new clause will break down the important trust between member states. Polish Prime Minister Mateusz Morawiecki said the EU was trying to bully weaker EU members, while his Hungarian counterpart Viktor Orban called the plan "blackmail" against member states opposed to immigration.

Both countries are the only two EU member states in the history of the bloc to have been investigated by the European Commission for breaking fundamental EU values of democracy and rule of law. This has been evident in recent years with both governments suppressing freedom of speech and conducting authoritarian policies.

The European Commissioner for Budget, Johannes Hahn, expressed his disappointment with the actions by Hungary and Poland: “This is not about ideologies but help for our citizens in the worst crisis since World War II!”. He urged member states to be responsible and take the necessary steps to pass the EU budget package.

The outcome of the deal is still not yet decided, as EU leaders are meeting up this week to discuss the issues.

Key terms:

  1. stimulus plan

  2. recovery fund

  3. rule of law

  4. authoritarian policies

Key questions:

  1. Why did the Hungarian and Polish governments block the stimulus plan?

  2. Are those actions justified? Why? Why not?

  3. What could EU governments do to pass the plan?

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