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Tobacco shop concessions and the governing party

April 29th, 2013

Left-wing and liberal commentators accuse the government of nepotism over changes to the law on selling tobacco products. They believe that the government imposed a monopoly on the selling of cigarettes in order to offer lucrative business possibilities to its own people.

The government decided last year that the sale of tobacco products would in future be limited to just 5,000 licensed vendors – compared to 45,000 retailers before. The government distributed the licenses through a tender procedure, and claimed that it wanted to help small family businesses, single mothers and people with disabilities as well as to make such unhealthy products less readily available. According to left-leaning dailies and weeklies, in hundreds of cases tenders were won by applicants with family or business ties to government politicians, and who had no prior experience in the tobacco business. Heti Világgazdaság reported that the decisions were made by local Fidesz politicians. Fidesz rejected the accusations and said that such hostile rumours are being spread by “the lobbyists of multinational companies, tobacco companies and alarmist left-wing parties.”

Anyone familiar with the style and tactics of Fidesz might have realized from the start that the real reason behind the tobacco shop concessions was to help the friends of the governing party, Konzervatív Alternatíva blog writes. According to the pro-market commentator, Fidesz has secured long-term monopolies for its own friends. As a result, it seems inevitable that the price of tobacco products will rise, and the price of perks given to the party hinterland will be paid by customers, the blog concludes.

Unless the government unveils how and by whom the tender decisions were made, it cannot convincingly dismiss criticism, simply by claiming that those who raise concerns about the distribution of licenses are politically motivated, Iván Várkonyi writes in Népszabadság. The left-wing columnist speculates that if the procedures had been fair and no nepotism was involved as the government claims, there would be no need to keep the details of the selection procedure in the dark.

Writing in Cink, László Szily takes it as a proven fact that Fidesz wanted to offer the lucrative tobacco business to its allies. Szily finds it alarming that not one of the hundreds of Fidesz representatives involved tried to stop a clearly unfair scheme by turning to the media. In an aside Szily notes that Fidesz is doing now what the Socialists did at the time of the democratic transition: they help their hinterland by providing them with unfair benefits taken away from the people.

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