Monetary financing by the Hungarian Central Bank - Main contents

Question for written answer to the Commission

Rule 130

Sophia in 't Veld (ALDE)

Subject: Monetary financing by the Hungarian Central Bank

Since 2014 the ECB Annual Reports refer to monetary financing issues regarding six foundations. In March 2016, they had to publish information about €1bn of investments of central bank resources. Most of it is used to acquire Hungarian government securities. The ECB repeatedly asked to ensure that central bank resources are not used for financing the State, as this is banned under Art 123TFEU. Last year, in response to questions of MEP Bullmann [1] the ECB stated it is monitoring the situation. There seems to have been no change in the practice of monetary financing, but the ECB has not intervened so far. Such prolonged non-compliance by a Member State undermines both fiscal discipline and the rule of law.

Based on the ongoing monitoring and available information, does the Commission consider that this is a case of violation of Article 123 TFEU?

If yes, will the Commission raise the issue in the recently started political dialogue with the Hungarian government, relating both to the respect of Union law and the respect of the Union's common values as enshrined in Article 2 TEU?

Alternatively, will the Commission initiate infringement proceedings in order to ensure respect to both fiscal discipline and the rule of law?

[1] Question Udo Bullmann (October 2016)

https://www.ecb.europa.eu/pub/pdf/other/161021__bullmann.en.pdf?436cb8a13396a534f154eb4bdf49616a