After the capitalist transition (1989), 1.5 million of the 4.8 million jobs were terminated, and in April 2010 there were still only 3.7 million workplaces. The activity rate of the population capable of work is only 54-55 percent. The main reason for the impoverishment of a considerable part of the population is unemployment. The average real income per capita reached the level of that before the transition only in the early 2000s. However, the income and social differences have increased, a big part of Hungarian society is considered poor (see below).  Under the circumstances of the present crisis the situation has worsened.

The endangered

In Hungary, most of the poor people belong to the following groups:

• - those permanently unemployed (48 percent are poor),
• - most of the (6-700 thousand) Roma people live in misery,
• - 41 percent of the families with children, 60 percent of the families with three or more children and 45     percent of the single parent families are poor,
• - the pensioners (50 percent of them are poor), in the future the number of those aging without or with low pensions as a result of having been unemployed and forced into illegal employment will grow,
• those suffering of permanent illnesses or disabilities and
• - the homeless.
• 
  

All these are complemented by the impoverishing “lower middle class” the members of which do their best to avoid poverty, but as a result of their low income they face more and more everyday problems.

Concerning unemployment and poverty, there are enormous regional differences in Hungary. The poorest regions – for reason of the collapse of the former industry – are located in Eastern, North-Eastern Hungary and Southern Transdanubia. Most of the Roma population live in these regions, misery is present in the urban and rural slums where it is almost hopeless to get out from.

Poverty level and children’s misery

In Hungary poverty is defined on the basis of the subsistence level calculations of the Hungarian Central Statistical Office. According to this, 30 percent of the population, about 3 million people live at the subsistence level (app. € 270 per capita a month) and below. According to the EU’s methodology (which puts the poverty level at 60 percent of the average income) the rate of the poor is 17 percent (app. 1.7 million people). 1.1 million of the 10 million Hungarians have permanently fallen behind, they live in social exclusion. They are the deep poor. The number of the homeless is estimated to be around 30-50 thousand. According to the official data, about 250 people freeze every winter, most of them in their own homes lacking heating.

20 percent of the Hungarian children live below the EU’s poverty level. 430 thousand of the 2.2 million children are very poor. About 750 thousand children are deprived in some way. At least 20-30 thousand children are suffering of hunger in Hungary today. Many of them are given hot food only at their kindergartens or schools.

Most of the poor families have to spend almost all of their incomes on fostering their children. Maintaining their flats or acquiring fire wood mean serious problems for them. In some cases even sending the children to school makes a problem.

Many times the problems of the poor children are even worsened by the absolutely anti-social behaviour of the privatised “public service” companies. They turn off public services in homes  and in some cases even at the kindergartens and schools maintained by municipalities lacking money. 25 percent of the poor families have already taken up usurious loans.

The Roma and the poor in social ghettos

In the “socialist” era almost 90 percent of the Roma men had a job. Today this rate is 20 percent. The former integration process based on employment and subsistence was terminated after the transition, and an obstacle is their low educational level to.

However, most of the poor are not Romas! The Roma families make one fourth of those living below the subsistence level and about half of those living on social benefits (the deep poor).

In the 90s, until 2004 the government’s Roma development projects ended, with no real results. Since 2004 no special Roma program has been started, they have been integrated into the projects supporting people disadvantaged at the labour market.

A growing range of people blame the poor for their own situation, and in many cases poverty is identified as the Roma. In the Hungarian society racism keeps strengthening, especially since the crisis began. Racist paramilitary organizations march at Roma settlements, and in 2008 and 2009 more than 10 Roma people were killed for racist motifs. And in 2010 an extreme rightist party hardly hiding its anti-Roma attitude has gained 17 percent at the parliamentary elections.

The situation of the non-Roma Hungarian poor is not much better. Most of them live in the same underdeveloped regions as the Romas.

Permanent unemployment breaks most of the marginalized people mentally. Alcoholism is flourishing, suicide is a well-known symptom, and no wonder if subsistence crime is general amongst them.

On the social care system

In Hungary the system of family allowance paid by subjective right and inherited from the “socialist” era is rather extended in an international comparison, although it is not of a high amount. Family allowance (approximately 60 € per children/month) is paid after almost two million children. The families bringing up children under three are also paid supports of  higher amounts. These are complemented by the social subsidy paid by the local municipalities.

Most of the poor people have no chance to earn their living from work. In addition, the active labour market methods have beenpushed back during the previous years. The number of those involved in adult education is lower than 50 thousand. About the same number of people were employed in public works, for the minimum wage for 6-7 months. The most often solution is that the employers are given support in case they employ permanently unemployed people, but when support ends, usually these people are dismissed. And the state spends billions of HUF – most of it European money – for projects supporting labour market return, most of them unsuccessful because of the low number of job offers. gradually

In many settlements social services are reduced. Subsidies are of low level, about 0.5 percent of the GDP is used for governmental and municipality benefits. Support is paid in many forms: regular social benefit, regular or special child protection support, flat maintenance support, public health benefit, special subsidy, etc.

According to the data of the Hungarian Central Statistical Office, in 2008 194 thousand people (families) were paid regular and other central social supports. So only one fifth of the people living in deep poverty were given regular social subsidies. Its average amount was HUF 26 600 (€ 100) per capita per month.

Social subsidizing is not a long-term solution since it is not enough to pay the public service bills and to maintain their homes in order to avoid moving to ghettos. Also, it is humiliating because it must be applied for. Many of the poorest don’t even know about their rights or don’t know how to assert them or are just unable to fill in a form.

Impacts of the crisis and strengthening racism

To meet the conditionality of the IMF and the European Union crisis credits, the Hungarian government introduced austerity measures in April 2009: in the public sector the nominal gross wages were frozen for two years, the 13^th month wage was cancelled as well as the 13^th month pension, the retiring age will gradually be raised from 62 to 65 years from 2012, sickness benefit was reduced by ten percentage points, the amount of family allowance was frozen for two years, the housing support system was suspended, VAT was raised from 20 to 25 percent, accession tax was also increased and the gas and heating support of the poor will be cancelled. The amended social act does not warrant the preservation of the real value of the subsidies any more. All these primarily hit the poorest.

With the crisis the official (registered) rate of unemployment grew from 7.5 percent at the beginning of 2007 to 11.8 percent by April 2010, half a million people are searching jobs at the labour agency offices. The number of the unemployed grew by 150-200 thousand in two years’ time.

The growth in unemployment and the policy of social restriction undermined the living of enormous groups. At the beginning of 2010 1.7 million public service and housing instalment debts exceeding 90 days were registered (1/4 of the Hungarian families were concerned!). At the moment 90 thousand families are directly threatened by the possibility of being evicted. It’s impossible that so many people are faulty. It is the society not providing enough jobs and income for them that is guilty.

Other labour market legal amendments introduced owing to the crisis, in spring 2009, are also unfavourable for most of the unemployed and the poor, sometimes even for the municipalities. According to Zsuzsa Ferge’s summary, “except for the fifteen-day public employment obligatory every three months all other supports of integration are cancelled; unemployment insurance benefit almost disappears; minor offences (e.g. black work) may bring exclusion from the subsidy system for good; in case a municipality is unable to organize public work (which can easily happen in small and poor villages), they will not be given backing for the subsidies from the budget…” (Ferge 2008).

Public opinion is moving right, and this is indicated by the fact that, a program of hidden racism was introduced at the governmental level. Instead of the former social benefit paid by subjective right those considered capable of work get “availability support” for which they have to do 90 days of public work a year, in principle. However, the municipalities can offer little work and have very little money. It is decided upon by the mayor’s subjective opinion whether a member of a family deserves – e.g. owing to his/her life style – the work possibility. There are settlements where the Roma and not Roma people seriously compete for the public works and the supports. Also, the name of the new system is misleading: A Way to Work Program. According to well-known sociologists it is not aimed at leading those supported back to the labour market. One of them says: this program “institutionalized and legalized a, roughly saying, ‘slavery-like relation’ between the subjects of the program and the municipalities which violates basic citizen rights in a democratic state. (…) The text of the act is almost openly directed at the Romas, it is almost a racist text” (Júlia Szalai, 2008). In addition, only one member of each family can be given the availability support, so 30-35 thousand people are excluded from earlier received social support.

Another sign of the preconceptual and racist way of thinking is the so called social card already used by many municipalities. The beneficiaries are paid the support through electronic cards, and they are allowed to spend it only in certain shops and for certain products. Activists of human rights protection keep this also unconstitutional because it restricts freedom and handles the alcoholic and non-alcoholic families alike.

Instead of a summary

According to Júlia Szalai: “the subsidized groups can be the great losers of the crisis, it seems that no one protects them. The Romas may become even more desperate. Eternal stigmatization and continuous frustration may lead to depression or an increase in aggression… Also, maintaining deep poverty is backed by hidden interests. It is worth thinking: caring for the poor gives regular income jobs to several thousands of people. And the majority society needs the poorest, as well: they are the cheapest labour force doing any kind of work. They make the ‘reserve troops’ of the economy” (Szalai 2008). According to another acknowledged expert, the present social system has one aim, which is perfectly fulfilled: to avoid hunger revolts.

Without social safety democracy and constitutional state remain dead letters.

Proposals

1.                  The global crisis proves the fact that the (neo-liberal) capitalist model reducing the welfare system, increasing social differences and destroying our natural environment is unsustainable. The economy must serve human race! Capital interests must be ousted from public services. The state is not to help the capital strong by itself but to support the living of the great majority! Alternative labour market, social cooperation, community production and marketing and the possibilities of reasonable public employment must be given support. All these can increase the budget proceeds and market demand, and decrease the social and other budget expenditures. Let us work 35 hours a week, and have more work places!

2.                  Beside the rules serving capital interests the so called economic and social rights of the population should also be raised to aN European level. We demand European Union social politics and aN European social minimum (including the rights to get minimum catering, housing, minimal public utility services, free education, health care and old-age pension)! Those really deprived must get most of the supports by subjective right.

3.                  To end social and local segregation, which is particularly strong in Eastern Europe, and the ghettos, the creation of workplaces, regional and local development, the formation of community-solidarity production cooperatives built on local resources and the reduction of inequalities and segregation in education are necessary.

4. All tools must be used to fight the populist and anti-Roma racist trends of apathy and the lack of solidarity offending the poor and spreading at a frightening pace.

Sources

Zsuzsa, Ferge (2008): A bumpy road to work. Népszabadság, April 13^th 2008.

Laeken indicators (2008): The indicators serving the international comparison of social exclusion.

Statistical Mirror (Statisztikai Tükör), Vol. 142. Hungarian Central Statistical Office.

Péter, Mózer (2009): The income and labour market situation of our society. P. 21. www.nonprofit.hu

Ágnes, Simon (2009): Social inequalities in Hungary. Institute for Social Politics and Labour

(Szociálpolitikai és Munkaügyi Intézet), Budapest. www.oefi.hu

Júlia Szalai on exclusion (2008): Strong interests are backing the maintenance of deep poverty. 168 Hours (168 óra), December 25^th.

http://3sz.hu/

http://www.gyerekszegenyseg.hu/index

http://www.nol.hu/cikk/488204/

http://www.origo.hu/itthon/20080707

http://www.rukverc.com/