Hungary C

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Hungary is placed in Band C. In relation to political corruption risk, the Parliament’s Defence and Internal Security Committee has formal powers of scrutiny of defence policy, though this was found to occur post facto. The new defence policy has been subject to public consultation, and debate on the sector has involved academics and think-tanks. There has been some systematic anti-corruption assessment by the State Audit Office (SAO), and the budget is fairly detailed, is subject to committee scrutiny, and is largely transparent – though, not in an easily digestible format. Arms controls are transparent and align with international protocols, though scrutiny is found to be limited. The assessment shows lack of effectiveness in the scrutiny of the intelligence services by the National Security Council, but there are formal procedures in place.

In terms of finance risk, the SAO audits asset disposals and they are indicated to be transparent as per legislation. There is no evidence of off-budget expenditure either. Parliamentary committees approve secret procurements, though there appears to be no separate audit of secret items. Finally, the MOD has business interests in various industries, including communications, arms, and cartography. A White Book was recently published covering controls of at least some of these firms.

In the area of personnel, there is considerable anti-corruption commitment in speeches and there is public evidence of action having been taken in White Books. Personnel numbers and pay rates are transparent and payment systems are indicated to be generally robust and not compromised. Although there are objective de juro recruitment systems, it is less certain that in practice such systems are immune from politicisation. There appears to be a lack of whistle-blowing policy and anti-corruption training. The Code of Conduct is found to lack clarity and coverage, and evidence of effectiveness is limited.

In operations, a new military strategy is scheduled to be brought out imminently, but the current one does not address corruption as an operational issue. There are operational civil-military co-operation handbooks that make reference to corruption, and some anti-corruption monitoring is indicated to occur.

Regarding procurement corruption risk, formal legislation exists but contains risk of exclusions, though oversight mechanisms are indicated to be comprehensive (involving four bodies, potentially, as per general procurement practice), and there is transparency surrounding purchasing. Probity is found to be aided by tender boards working closely with legal, economic, and financial experts. However, when considering potential bidders, the government does not specifically mention corruption as a barring factor. Poor controls in offsets have been linked to scandals and there is little transparency surrounding these contracts.

Research finalised: May 2012

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