The Tisza party is deceiving its voters
Péter Magyar would put double pressure on households. For one thing, it turned out that Tisza’s plan for drastic tax increases would reduce the disposable income of the majority of Hungarian employees. For another thing, the party has made Brussels’ efforts to ban Russian energy sources part of its official manifesto, which would result in fuel prices above HUF 1,000 per litre and utility bills three and a half times higher than at present, thus drastically increasing household costs.
They are trying to conceal the double tightening: the vice-president of Tisza said at a forum that they should not talk about austerity measures before the elections, because if they revealed everything, they would lose, but if they win, “they can do anything after that”. On another occasion, the party’s advisor said that he did not recommend questioning the overhead cost reduction policy for the time being because it was a “hot topic”, but that it could be brought up after a while.
However, Péter Magyar’s planned austerity measures would cause such social damage that they cannot be ignored. Századvég therefore calculated the consequences of the Tisza energy programme for the most vulnerable families.
Péter Magyar’s energy programme would hurt low-income earners more
A household’s energy needs are primarily determined not by its income, but by factors such as the size of the home, the number of people living in the household, the amount of equipment, and the efficiency of the appliances. This relationship is also supported by Hungarian data: in Hungary, there is a slight difference in the average utility costs of different income groups. The highest expenditure is in the lowest income quintile (HUF 209,000 per year), while the lowest expenditure is in the wealthiest quintile (HUF 192,000). The difference between the two is HUF 17,000.
The Tisza Party’s energy policy would drastically increase electricity and gas prices, which would also exacerbate the disparities between income categories. Péter Magyar’s measure would hurt the wealthiest the least, with an annual cost increase of HUF 495,000, which is HUF 45,000 less than for the lowest income category, which would see electricity and gas bills rise by HUF 540,000. Such an extra burden would be beyond the means of a broad section of society.
Tisza’s policies would render many households insolvent
Thanks to the overhead cost reduction policy, the proportion of people in energy poverty in Hungary has fallen the most in the European Union. The misguided decisions of governments prior to 2010 led to a surge in residential electricity and gas prices, which became unaffordable for many people. Prior to the introduction of overhead cost reduction policy, a quarter of households were unable to pay their utility bills for financial reasons. The proportion of those affected dropped to 7% by 2024, representing 287,000 households.
Péter Magyar’s public utilities policy would halt the favourable trend and cause serious existential difficulties for a wide range of people. The proportion of those who are unable to pay their utility bills for financial reasons would increase to 29%, which would mean a total of nearly 1.2 million households, or 2.8 million Hungarians.[1] By banning Russian energy sources and ending overhead cost reductions, the Tisza Party would cause social tensions with unpredictable consequences.
[1] We estimated the proportion of those affected based on the correlation between price changes prior to the overhead cost reduction policy and the past trend in the proportion of households struggling with late payment. The data are based on the Hungarian Central Statistical Office’s Statistics on Income and Living Conditions and EUROSTAT data. The resulting correlation value was multiplied by the current value of the energy poverty indicators, adjusted by the price change under study.
