Part I — Situation overview

Between 16 and 17 October, criminal complaints were announced in three mutually independent public-money cases. On 16 October, István Kapitány, Minister for Economy and Energy, announced that he had filed a criminal complaint in the matter of the Kisfaludy Tourism Development Programme on suspicion of breach of trust causing particularly significant financial loss and of agreements restricting competition. According to the audit, the programme distributed 475 billion forints through nearly 23,000 contracts. However, 0.5 percent of the contracts — 108 contracts — received more than 60 percent of the envelope, 288 billion forints, to a large extent by individual decision rather than through a call for applications. On 17 October, Vilmos Kátai-Németh, Minister for Social Affairs and Family, filed a criminal complaint with the Central Chief Prosecutor’s Office of Investigation on suspicion of abuse of office and breach of trust. According to him, under the Family-Friendly Hungary (Családbarát Magyarország) programme series, more than 600 million forints of public money went to events in the Szerencs constituency of former State Secretary for Family Affairs Zsófia Koncz between February 2026 and the election on 12 April. Zsófia Koncz and Viktor Orbán’s office called the accusation slander, and the former state secretary announced a lawsuit for violation of personality rights. On 16 October, the interim management of the public media announced that 9,738 assets — worth 2.1 billion forints at their original gross value — were missing from the 2025 inventory, and that it would file a criminal complaint.

The cases have a history. In July, at the time of Zoltán Guller’s dismissal, MIAK called for a retrospective audit of tourism subsidies — that audit has now produced results. And in its analysis of accountability in culture financing, MIAK identified discretionary allocation of funds, that is, allocation based on individual judgement, as the root cause.

MIAK’s reading: criminal liability will be decided by a court, after proceedings by the investigating authority and the prosecution service, not by the ministry that filed the complaint — and until then those involved are entitled to the presumption of innocence. The policy question, however, does not hinge on the verdict. In three different areas — tourism, family policy, public media — the same structure is visible: individual decisions, weak record-keeping and missing ex-post control. This pattern must be eliminated even if no conviction is handed down in any of the cases. The first forward-looking response arrived on the same day: in the procurement of national events, instead of a single service provider, up to ten companies will compete for each individual assignment.

Part II — Grounding in the literature

Three classic ideas frame the interpretation of the three cases. Susan Rose-Ackerman, an American lawyer-economist and one of the leading researchers of the institutional analysis of corruption, argues in Corruption and Government that simplifying programmes is itself an anti-corruption tool. In her view, every open, not predefined eligibility judgement creates risk — the individual decisions of the Kisfaludy programme were exactly of this kind. She also describes how in some countries state resources are mobilised to win electoral support, which gives the policy question of the Family-Friendly Hungary thread. Sergei Guriev, a Russian economist, and Daniel Treisman, an American political scientist, show in their book Spin Dictators how modern authoritarian leaders win over media-market players with state advertising and government contracts. This is the political-economy background of the public media’s financial management. And Peter F. Drucker (Austrian-American management thinker, founder of the methodology of measuring organisational effectiveness) demands in The Effective Executive that every programme be regularly re-justified: if we were not already doing it, would we start it today? The detailed discussion of the literature — author by author, paraphrasing the lines of argument — can be found in section 6.4 Literature in detail.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable measures — each responds to one element of the pattern uncovered, and each is independent of the outcome of the proceedings in the specific cases.

3.1 A concentration alarm in every central subsidy programme (by the start of the 2027 budget year)

The key figure in the debate on the Kisfaludy programme — that 0.5 percent of the contracts took more than 60 percent of the envelope — came to light through an ex-post audit. MIAK proposes that from 1 January 2027 this indicator become mandatory data, published quarterly, in every central subsidy programme with an envelope above ten billion forints: (1) the share of the top 1 percent of the largest contracts in the amount paid out; (2) the proportion of subsidies awarded by individual decision without a call for applications; (3) for every individual decision, the decision-making body and the written justification of the decision, within 15 days. If the proportion of individual decisions exceeds one fifth of the envelope, or the share of the top 1 percent exceeds half, the programme should automatically be subject to an external, independent audit investigation. The summary of the investigation should be public. Concentration in itself is not a violation of the law — a large hotel development is necessarily larger than a village guesthouse — but it requires a public justification. This extends the logic of the A1 public-money dashboard and the A2 anomaly detector to subsidies beyond public procurement. In Rose-Ackerman’s analytical framework (see 6.4.1) this narrows the scope of open-ended discretion — just as, on the procurement side, the framework agreement introduced for national events and the renewed competition called for each individual assignment do.

3.2 A campaign-period separation rule for ministry events (bill by 30 June 2027)

In the Family-Friendly Hungary case, according to the minister, the region’s state secretary, who was also running as a candidate, appeared and spoke at six events in Szerencs financed from ministry funds; according to those involved, these were free, well-attended family programmes without any campaign element. Whether a crime was committed is not for MIAK to decide. The regulatory question, however, is why there was no standard fixed in advance against which the events could be measured afterwards. MIAK proposes that, for the period from the calling of the election to polling day, a law should lay down that: (1) the cost, venue and performers of every public event financed by a ministry or a state-owned company are made public within 8 days; (2) if state event spending in a constituency during the campaign period exceeds one and a half times the average measured in the same period of the previous three years, the financing ministry gives a public justification; (3) a member of the government, state secretary or other political leader running as a candidate in the constituency may not be a speaker at a state event held in their own constituency. The rule carries forward the logic of programme point A12 on campaign finance: the ceiling on campaign spending can be circumvented if campaign-style appearances are financed from state event budgets. Guriev and Treisman’s account (see 6.4.2) shows why this must be fixed in advance with respect to every government, rather than disputed afterwards, case by case.

3.3 A minimum standard for asset registers in public institutions (by the inventory reference date of 31 December 2027)

According to the MTVA audit, inventory practice complied neither with accounting requirements nor with the institution’s own rules. More than half of the roughly 173,000 registered assets were not counted item by item, and a 2019 instruction explicitly removed the costume, props and furniture stores from the areas to be inventoried. The 9,738 missing assets were then written off without any meaningful investigation of the cause of the shortfall. MIAK proposes that a government decree should prescribe a minimum for state institutions with more than ten thousand registered assets: (1) a mandatory item-by-item inventory at least every two years, for every storeroom without exception; (2) machine identification (barcode or radio-frequency tag) for assets above the registration value threshold; (3) a shortfall may be written off only with a root-cause investigation report; (4) a public annual summary of shortfalls, surpluses and disposals. Programme point A7 would tie the financing of the public media to a formula laid down in law — but the credibility of the formula depends on whether the assets on which the money is spent can be tracked. According to Drucker’s principle (see 6.4.3), what is not measured cannot be reviewed.

The three proposals are linked by the same principle: failures in the handling of public money should be discovered not by criminal complaints, but by routine data disclosure. Audits and criminal proceedings are expensive, slow and always after the fact; the concentration indicator, campaign-period publicity and the inventory minimum are cheap, continuous and deterrent in advance. The new procurement model for national events shows that the direction is feasible — the question is whether it remains a one-off good decision or becomes a rule.

Part IV — Expected effects and risks

Dimension Expected effect Risk
Public money and the economy The concentration indicator signals early if a programme clusters around a few beneficiaries; the duty to justify individual decisions narrows the scope of discretion The thresholds may produce false alarms where large projects are professionally justified; beneficiaries may circumvent the indicator by splitting contracts
Electoral competition Campaign-period publicity of state events reduces the resource advantage of incumbents, equally with respect to every government In an overly strict form, the rule may also hold back genuine government information and local community programmes; the notion of a “political leader running as a candidate” must be defined precisely
Public administration The inventory minimum makes the asset management of state institutions comparable for the first time; the causes of shortfalls remain open to investigation afterwards The one-off cost of machine identification and a full inventory every two years is significant, especially for institutions with large, old storerooms
Public media The traceability of assets strengthens the credibility of the public media’s financing formula The inventory affair may turn into a political dispute and obscure the structural questions of programme-production spending

The main tension of the package lies between prevention and administrative burden. The concentration indicator and campaign-period publicity become risky if the thresholds turn into mechanical prohibitions: the aim is to enforce public justification, not to prevent large projects or the state programmes customary during election periods. This is why MIAK proposes that crossing a threshold should trigger an investigation and a justification, not an automatic sanction. The second question concerns the incumbent government: at the next election, rule 3.2 will restrict the current governing parties first, and that is precisely what makes it credible. The third concerns cost: the inventory minimum is a one-off investment, but in the case of MTVA the original value of the assets written off as missing is by itself of a larger order of magnitude than the introduction of a modern asset-tracking system. The extent of the damage is, however, not identical to this amount, because the book value of most of the assets was already zero.

Part V — Measurability and summary

5.1 What is worth following? (suggested KPIs)

MIAK proposes four key performance indicators (KPIs), from which it will be visible after 12 and 24 months whether the pattern has been broken:

  • The proportion of subsidies awarded by individual decision in central programmes above ten billion forints, broken down by quarter. Suggested target: at most 10 percent of the amount paid out within 24 months.
  • The share of the top 1 percent of the largest contracts per programme — worth following, because in the Kisfaludy programme even the top 0.5 percent took more than 60 percent of the envelope.
  • The competitive intensity of the framework agreement for national events: the average number of bidders in the per-assignment competitions, and how many of the up to ten framework-contract companies actually win an assignment in the first year. If one or two companies take most of the assignments, the model is competition on paper but not in practice.
  • The proportion of assets inventoried item by item at the public media and the large state institutions. Suggested target: 100 percent by the end of 2027, with a root-cause investigation report for items written off as missing.

5.2 Summary

MIAK’s request: the criminal complaints should be accompanied by a rule that makes the next similar case visible before the payment is made. Specifically: a concentration alarm and a duty to justify from the 2027 budget year, a campaign-period events rule laid down in law by mid-2027, and an asset-register minimum by the 2027 inventory reference date. And the new procurement model for national events is worth extending to government communication procurement as well.

Two of MIAK’s foundational values are at stake here. Accountability, in the sense that the path of public money should be traceable routinely, not only after a scandal — and that the denials of those involved and the right of the court to decide should be as much a part of the process as the criminal complaint. And data-drivenness, because the most important facts of the three cases — the 0.5 percent and the 60 percent, the 600 million forints in two months, the 9,738 missing assets — are all data that would have been available for years if someone had regularly published and analysed them.

Part VI — Reasoning and further sources

6.1 Press framing by spectrum

The left-liberal segment put the Family-Friendly Hungary thread in the foreground, but with different emphases. 444.hu put the complainant minister’s claim in its headline. In the article it noted separately that the summer tax-authority (NAV) house search at the family-policy centre took place in an earlier case concerning the 2018–2020 period, independently of the current complaint — a distinction that the other outlets failed to make. Telex made the Fidesz reaction and Zsófia Koncz’s response a separate news item, and HVG the announcement of the personality-rights lawsuit; both outlets framed the dispute as a procedural situation, together with the position of those involved. On the public-media inventory, however, it was HVG that brought the most colourful details — the remarks in the inventory lists and the equipment left behind in the old radio headquarters — which reinforces the anecdote rather than the systemic failure.

In the public-affairs segment, ATV chose an evaluative verb for its headline on the Family-Friendly Hungary thread (“squandered”), which frames the claim in the complaint as an established fact. 24.hu put the reaction of the former prime minister’s office in its headline, and on the same day also published the production costs of two entertainment programmes of the public media. In doing so it extended the topic of public-media financial management beyond the inventory question, in the direction of programming policy.

In the economic segment, Portfolio discussed all three threads in the most data-rich way: for the Kisfaludy programme it published the concentration figures as well as an expert’s assessment. According to the expert, the programme renovated or created some 30,000 rural accommodation rooms, but its efficiency was undermined by the lack of a uniform application system. On the MTVA thread, the same outlet recorded the clarification that the 2.1 billion forints is the original gross value of the assets, not the damage established. Portfolio was also the only outlet to give a detailed account of the new procurement model for national events.

In the conservative segment, Magyar Nemzet framed the Family-Friendly Hungary thread with the statement of the former prime minister’s office, which called the accusation slander and urged the head of the ministry to concern himself with the continuation of the programme. On the Kisfaludy and MTVA threads, no stand-alone piece appeared in the conservative outlets examined in MIAK’s source list.

6.2 Facts and data

Data Value Source
Total amount distributed by the Kisfaludy programme HUF 475 bn, through nearly 23,000 contracts (the initial envelope was HUF 300 bn) Portfolio, 16 October 2026
Share of the largest contracts 108 contracts (0.5%) — HUF 288 bn, more than 60% of the envelope Portfolio, 16 October 2026
Subject of the Kisfaludy complaint suspicion of breach of trust causing particularly significant financial loss, and of agreements restricting competition Portfolio, 16 October 2026
A positive result of the Kisfaludy programme renovation or creation of some 30,000 rural accommodation rooms (expert assessment) Portfolio, 16 October 2026
Family-Friendly Hungary events in Szerencs more than HUF 600 m between February 2026 and the election; of which the Easter event on 5 April HUF 343 m (according to the minister) Portfolio, ATV, HVG, 17 October 2026
Subject of the Family-Friendly Hungary complaint suspicion of abuse of office and breach of trust; Central Chief Prosecutor’s Office of Investigation 444.hu, Portfolio, 17 October 2026
Position of those involved slander; the events were free, nearly 20,000 people attended the Easter event, the budget was accounted for and audited; personality-rights lawsuit Telex, HVG, 24.hu, Magyar Nemzet, 17 October 2026
MTVA: assets written off as missing 9,738 assets, original gross value HUF 2.1 bn (not the damage established; the book value of most was zero) HVG, Portfolio, 16 October 2026
MTVA: registered asset stock some 173,000 assets, of which some 95,000 (55%) costume, props and furniture store items without an actual inventory HVG, Portfolio, 16 October 2026
MTVA: further discrepancies some 17,000 items in a different location; more than 8,000 assigned to non-existent units; discrepancies in 36% of the sample Portfolio, 16 October 2026
Public media: external production of two entertainment programmes 2024–2026: a total of HUF 1,406,762,794 (104 episodes); the contracts have been terminated 24.hu, ATV, 16–17 October 2026
New procurement model for national events framework agreement with up to 10 companies instead of a single provider, renewed competition per assignment; the drafts are open to public comment Portfolio, 17 October 2026
Statutory definitions of the offences under investigation abuse of office: Section 305 of the Criminal Code; breach of trust: Section 376 of the Criminal Code; agreement restricting competition in public procurement procedures: Section 420 of the Criminal Code Act C of 2012 (Criminal Code)

The amounts in the table related to the criminal complaints are statements by the complainant ministries, not findings of an authority or a court — clarifying them is precisely the subject of the proceedings.

6.3 Policy dimensions

  • Transparency and anti-corruption policy (programme points) — the main area of the three proposals: A1 (public-money dashboard) and A2 (public procurement transparency) provide the data logic of the concentration indicator, A12 (campaign finance) that of the campaign-period rule, and A7 (media pluralism) the institutional framework for the public media’s financial management;
  • Economy (programme points) — G21 (systematic review of public expenditure) prescribes the regular re-justification of programmes, like Kisfaludy, that have swollen over the years;
  • Public administration and e-government (programme points) — KI8 (Drucker-based effectiveness measurement) provides the administrative background for programme-level results measurement and the asset-register minimum;
  • Culture (programme points) — KU2 (media pluralism monitoring) links the publicity of the public media’s external production costs to media-market transparency;
  • Social policy (background material) — the earmarking of family-policy programme funds: the credibility of money intended for family support also depends on whether it is kept separate from political communication.

6.4 Literature in detail

6.4.1 Susan Rose-Ackerman: Corruption and Government

Rose-Ackerman treats corruption not as a problem of individual morality but as a problem of incentives: where public officials hand out valuable benefits with discretionary powers, it pays for private actors to pay for favourable treatment. From this follows one of her least spectacular but most practical proposals: simplifying programmes is itself an anti-corruption strategy. According to the author, every open, not predefined judgement in determining eligibility carries risk — in extreme cases even a lottery may be a cleaner method of allocation, because there at least the winners actually obtain the benefit.

The political chapter of the book also describes another mechanism: in some countries party leaders build networks of obligation to win electoral support not only with campaign money but also by mobilising state resources, jobs and government favours. Here the author stresses the importance of clear rules — the difference between legal and illegal political financing becomes blurred if favours are not regulated.

Applied to the Hungarian case: the individual decisions taken in the Kisfaludy programme instead of calls for applications are exactly the open points of discretion that Rose-Ackerman writes about, and MIAK’s concentration indicator makes their proportion visible. The Family-Friendly Hungary thread, in turn — regardless of how the specific case is judged — reveals the regulatory gap that the campaign-period separation rule would close.

📖 Source: Susan Rose-Ackerman: Corruption and Government

6.4.2 Sergei Guriev – Daniel Treisman: Spin Dictators

Guriev and Treisman see the main change in 21st-century authoritarianism in the fact that manipulation and co-optation, rather than open repression, have become the main tool. According to the authors, members of the informed elite, including media-market players, can be won over with money, exclusive information and state advertising, and the book explicitly places Hungarian practice in this category as well. Elsewhere they write that as long as the leader has resources, he can also buy off the informed elite with government contracts and privileges, and can even draw some representatives of the creative professions into constructing a desired picture of reality.

MIAK does not derive from this a judgement on individual contracts — the production costs of the public media’s entertainment programmes prove nothing in themselves. The lesson is structural: where decisions on state media spending, event spending and government communication are taken without public rules, the allocation of funds can easily become a reward for political loyalty, and this is almost impossible to prove afterwards. The campaign-period separation and the traceability of public-media assets are therefore not directed against one government, but narrow the room for manoeuvre of every future government.

📖 Source: Sergei Guriev – Daniel Treisman: Spin Dictators

6.4.3 Peter F. Drucker: The Effective Executive

Drucker describes the deliberate sloughing off of the past as one of the basic rules of the effective executive: executives must regularly review their programmes and ask whether, if they were not already doing it, they would start it today. If the answer is not an unequivocal yes, the activity should be stopped or sharply cut back — or at least no more resources should be devoted to it. According to Drucker, a regular “life-or-death” review of every programme and activity stimulates renewal even in the most rigid bureaucracy.

The path of the Kisfaludy programme is the reverse of this: the initial envelope of 300 billion forints was later raised substantially, while programme-level results measurement and a public analysis of the beneficiary structure were never carried out. MIAK’s programme point G21 translates Drucker’s principle to the budget: a mandatory review of every budget line every three years. The MTVA inventory is the asset-side version of the same deficiency — what is not counted cannot be reviewed.

📖 Source: Peter F. Drucker: The Effective Executive

6.5 International comparison

Concentration and anomaly indicators are not theoretical tools. In the years following its introduction, Ukraine’s electronic public procurement system reduced the proportion of single-bid procedures from around 40 percent to 18 percent (according to the international precedents collected in MIAK’s programme point A2); in Slovakia, since 2011, every state contract enters into force only once it has been published in the online register. Both examples show that making data disclosure mandatory changes the behaviour of decision-makers in itself — MIAK’s proposal 3.1 would extend this logic to subsidies outside public procurement.

For campaign-period separation, the practice of the United Kingdom offers a model: in the pre-election period, government communication and public announcements are subject to separate, pre-published conduct guidance that limits the state-resource advantage of incumbents. The newly announced procurement model for national events — a framework agreement with several companies, renewed competition per assignment, and in the longer term a dynamic purchasing system that new companies can join while it is in operation — builds on established instruments of EU public procurement rules. The novelty is not the instrument, but the fact that it is being applied in an area previously built on a single provider.

Transparency and anti-corruption policy

  • A1 — Public-money dashboard
  • A2 — Public procurement transparency
  • A7 — Media pluralism as an institutional guarantee
  • A12 — Transparency and ceiling of campaign finance

Economy

  • G21 — Systematic review of public expenditure

Public administration and e-government

  • KI8 — Drucker-based effectiveness measurement in public administration

Culture

  • KU2 — Media pluralism monitoring

Suggested new programme point: Concentration alarm and campaign-period events rule — for the Transparency and anti-corruption policy area: a mandatory quarterly concentration and individual-decision indicator in every large subsidy programme, together with campaign-period publicity and separation of state events.

6.7 List of sources

Press sources (MIAK press monitor, 18 October 2026 — topic 3):

Knowledge base references (literature):

  • 📖 Susan Rose-Ackerman: Corruption and Government
  • 📖 Sergei Guriev – Daniel Treisman: Spin Dictators
  • 📖 Peter F. Drucker: The Effective Executive

Legal source:

  • Act C of 2012 on the Criminal Code (Sections 305, 376, 420)

MIAK internal materials:

  • MIAK policy area: Transparency and anti-corruption policy (programme points; programme point ID: A1, A2, A7, A12)
  • MIAK policy area: Economy (programme points; programme point ID: G21)
  • MIAK policy area: Public administration and e-government (programme points; programme point ID: KI8)
  • MIAK policy area: Culture (programme points; programme point ID: KU2)
  • MIAK policy area: Social policy (background material)
  • MIAK press monitor, 18 October 2026 — topic 3, score: 90/100

Supplementary public data sources:

  • Electronic Public Procurement System (EKR) — the procurement drafts for national events
  • The Kisfaludy contract lists of the Hungarian Tourism Agency
  • Public-interest data and announcements of Duna Médiaszolgáltató (the public service media provider)

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