March 7, 2018 / 3:13 PM / 15 days ago

Hungary PM announces pre-election handouts to pensioners, families

BUDAPEST (Reuters) - Hungarian Prime Minister Viktor Orban announced pre-election handouts to millions of families and pensioners on Wednesday after his right-wing Fidesz party suffered a surprise by-election defeat ahead of an April 8 national poll.

Hungarian Prime Minister Viktor Orban talks during a forum of the chamber of industry in Budapest, Hungary, March 6, 2018. REUTERS/Bernadett Szabo

Fidesz is well ahead of rivals in opinion polls for the national election, but was caught off guard by the victory of an opposition-backed independent over its candidate in a by-election on Feb. 25.

Seeking a third consecutive term, Fidesz is campaigning with a fiercely anti-immigrant message and promises of more state spending, including on wages and pensions.

In a video clip posted on his Facebook page, Orban said the country’s around 2.6 million pensioners would receive a one-off voucher for food purchases and that every Hungarian family would get a refund of 12,000 forints ($48) on its heating bill.

“In the past weeks we have suffered from extreme cold weather in Hungary, the gas consumption of families has increased and so did the gas bill... Therefore, we decided on a winter reduction of gas bills,” Orban said.

It was not immediately clear whether the refund would be financed from the state budget or by gas firms. Most gas distribution companies are owned by the state after Orban’s government took over much of the energy sector from foreign firms over the past eight years.

Hungary’s national weather institute has said this winter has been milder than usual and that January was the sixth warmest since 1901.

The Economy Ministry was not immediately available to comment on the cost of the new measures.

Reuters’ calculations showed the two measures could cost a total of over 60 billion forints ($239 million), but Peter Virovacz, an analyst at ING Bank, said this posed no risk to the budget deficit target.

“This can be covered from the reserves,” he said. “We can regard this as a gesture ahead of elections.”

Hungarian governments of various hues have often offered generous welfare handouts to voters ahead of elections since the fall of communism in 1989.

Orban said last week that opposition parties would unite to try to oust his party in the national election and would turn Hungary into a haven for immigrants.

($1 = 251.2400 forints)

Reporting by Krisztina Than and Gergely Szakacs; Editing by Gareth Jones

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