First, it is important to emphasize that the energy policy of the socialist governments in power before 2010 was based on the market pricing of household energy sources instead of the currently prevailing administered pricing. Between 2002 and 2010, the price of gas tripled, and the price of electricity doubled, and in 2008, the year of the outbreak of the global economic crisis, the cabinet headed by Ferenc Gyurcsány raised household overheads four times in one year. In contrast, the civilian government decided to freeze energy prices in real terms in 2010, and a comprehensive overhead cost reduction program was launched on 1 January 2013.
The left’s plans to increase overhead costs are disguised by misleading billboards
Péter Márki-Zay and his left-wing allies have launched a billboard campaign, in which they have announced, among other things, that “Orbán will go but overhead cost reduction will remain”. In a recent interview with Népszava, the left-liberal candidate for head of government also stated that “overhead cost reduction will remain” and strongly denied and “objected” that he would lift the 2014 freeze on household energy tariffs. Given that the promises in question are in sharp contrast with the ideas of overhead policy previously voiced by the left bloc, Századvég has taken a closer look at the possible background to the “turnaround” of Márki-Zay and his allies.
The Gyurcsány-ally has been attacking the overhead cost reduction for years
However, there are several indicators that
left-wing forces remain committed to resuming their pre-2010 policy and, if they come to power, they would introduce market-based pricing instead of low administered prices
This statement is proved by the fact that
- Péter Márki-Zay previously explained that “the overhead cost reduction carried out by Fidesz is unsustainable”, “it is impossible to stop world market prices at the border” and “in order to make the economy sustainable, it is necessary to feel the increase in energy prices”.
- In 2014, Ferenc Gyurcsány called the reduction of overhead costs “stupid”,
- Csaba Molnár, Member of the European Parliament for Demokratikus Koalíció, said in 2015 that “the government’s overhead cost reduction is a lie, and the population could only slightly experience it” and, praising market pricing, he said that “reducing world oil and gas prices would allow a 20-30 percent reduction in gas and district heating”.
- Péter Jakab, leader of Jobbik, called the overhead reduction the “scam of the century”.
Regarding the latter three statements, it is important to point out that in November 2021, among others, if the administered prices provided by the overhead cost reduction had not prevailed, the population would have faced an almost fourfold increase in expenditure: an average Hungarian household had to spend HUF 22,000 on electricity and gas, which, with market pricing, would have exceeded HUF 8,000. Nor should we forget that
- In 2020, Demokratikus Koalíció in the European Parliament called on EU Member States to introduce taxes on uniform household energy prices and abolish all state subsidies for natural gas, while Katalin Cseh from Momentum called for the development of a strategy that aims to abolish regulated electricity and heating prices, and
- According to Márta V. Naszályi from Párbeszéd, “The reduction of overhead costs is a big lie”, because “the world market price of electricity is a fraction of what Hungarians pay for it”.
In contrast, average electricity market prices in December 2021 were four times the reduced overhead prices.
The left’s “turn” in overhead policy is a communication trick
In the light of these, however, the question rightly arises as to why there has been an apparent change in the left’s overhead policy in the run-up to the parliamentary elections. Gergely Karácsony has already drawn attention to the differences between the left-liberal alliance’s real political intentions and communication strategy and its campaign promises in the interview with the German Die Zeit in August regarding the issue of migration. The mayor of Budapest at the time said that “guaranteeing the human rights of asylum seekers is our moral duty and part of our program, but we will not print it on our election posters” because “we will not be able to win the elections with this”. It is of particular interest that Márki-Zay in his most recent interview on overhead cost reduction also acknowledged that “it would equal a political suicide if somebody campaigned with abolishing something good.”
Thus, it is probable that
the “turnaround” of Péter Márki-Zay and his left-wing partners is not a sincere review of their previously represented overhead policy aimed at significantly increasing the monthly burden on Hungarian households but a campaign bluff.
However, it is questionable whether the deliberate deception of the electorate and the misleading “repackaging” of real energy policy goals will bring the left the popularity they are hoping for, especially given that the left-liberal bloc has been struggling with a credibility deficit for 15 years.