The Hungarian government’s newest business venture: Installing an e-toll system

György Matolcsy’s failed attempts at putting together a budget that doesn’t need almost immediate adjustment are legendary by now. The final budget accepted in December looked suspicious from the very beginning. Matolcsy included about 400 billion forints from taxes that were not in accordance with European Union laws. If the ruling of the European Court of Justice goes against Hungary, which seems likely, the companies that were so taxed must be reimbursed. So, there is already a 400 billion hole in the 2013 budget.

But that is just the beginning.  There are two other listed sources of revenue that most likely will not add a forint to the coffers of the Hungarian state. You may recall that the Orbán government hoped to receive 75 billion forints from an e-toll system that would require trucks over 3.5 tons to pay per kilometer fees on Hungarian roads. The system was supposed to be functional by July 1, 2013. Another 95 billion forints of value-added tax was supposed to be received by introducing a cash register network directly connected to the Hungarian equivalent of the Internal Revenue Service.

Well, it looks as if neither system will be in place by July 1. Here I would like to explain what went wrong with the e-toll system. Let’s start with the fundamentals. To work out such a complex system takes a lot of time. For example, in Germany, where the system functions well, the government began thinking about its introduction in 1998 but the law regarding the e-toll system was enacted only in 2002. The Germans hoped that the system would be up and running in 2003, but it was completed only in 2006. It is based on a satellite positioning system.  The Austrians also took their time planning and eventually setting up a system in 2003. In Hungary, by contrast, the decision was reached within a few months and by September companies were invited to tender bids for the new electronic toll road system. There were two bidders: T-Systems, a unit of Magyar Telekom, with a 53.4 billion forint bid and Getronics with a bid of 34.89 billion forints. The Hungarian government opted for the lower bid although Getronics had no prior experience in this area. On January 19, in large measure because of the hefty fines that would be levied if it did not complete the project on time, Getronics decided not to sign the contract. The Hungarian government, instead of turning to T-Systems, the under-bidder, decided to go it alone as a kind of “general contractor.”

Before pondering the wisdom of this move, let’s go back a bit in time to review Viktor Orbán’s attitude toward tolls in general. When he became prime minister in 1998 there was a functioning per kilometer system in place. It was the old-fashioned variety, with gates where one got a ticket which drivers paid once they left the toll road. Viktor Orbán in those days didn’t like that system. In its place the first Orbán government introduced a system based on prepaid fees that allowed the owner of the car to be on the road at certain times. It was called the “matrica” system. Matrica means sticker in Hungarian.

So, after 1998 all the “gates” on the toll roads were dismantled because Orbán maintained that “gates are for football fields and not for roads.” At that time there were altogether about 80 such gates on two highways (M1 and M3). To build them cost about 5 billion forints; it was another 1 billion to demolish them. I remember being horrified at the idea of demolishing these gates and substituting the “sticker” system that I found unfair. After all, a valid sticker cost the same whether the person drove 200 km or 20km on any given day. Moreover, ascertaining whether a driver had a valid sticker was haphazard; the state relied on spot checking.

Fourteen years later Orbán obviously changed his mind. As far as I’m concerned this would be fine if the e-toll system was professionally and competently designed and executed. But, according to rumor, the job will end up in the hands of companies whose management teams have close ties to the government. The rationale for choosing them will be based not on experience and competence but on political connections. Most people claim that in Hungary there is simply no company capable of creating an e-toll system that is up to snuff. Yet Orbán promised the pensioners in Vásárosnamény that on January 23 Hungary will have an e-toll system that will be all Hungarian.

Illustration to autopult.hu's article on the subject of e-toll

The illustration accompanying autopult.hu’s article on the subject of  an e-toll system, Hungarian style

The government’s self-confidence is not shaken. András Giró-Szász announced that Getronics’s pulling out is only “a minor detail.” Orbán assured his listeners that all the budgets he submitted in the past went through with flying colors and this will also be true of the 2013 budget. Well, flying colors is surely a bit of an exaggeration because we all remember how many times Matolcsy had to change the figures and how many new taxes had to be introduced to meet the EU’s deficit target.

A toll system that works only in Hungary and that is not compatible with those of other countries in the European Union would be a waste of money, according to experts. Apparently within a few years the European Union is planning to introduce a single system that will be based on satellite technology. There is another problem if a unique Hungarian system is introduced. There is a Union rule stating that trucks from EU countries cannot be stopped at borders. That means that inside of the vehicles there must be a piece of equipment that is able to record the traveled kilometers. In an incompatible system that wouldn’t work. Trucks would need a separate Hungarian recording system. In addition, European Union rules require that all information about time, route, etc. must be safely stored, and experts fear that any system that could be introduced in five months wouldn’t be sophisticated enough to ensure the safe storage of information.

All in all, most people are pretty certain that with the Hungarian state as “general contractor” the proposed e-toll system will be a flop. Earlier the Hungarian government wanted to have its own mobile service and announced its plan with great fanfare. Even though the new company existed only on paper, it received a frequency necessary for operation. The government even appointed a CEO. Everybody told the government that it was an unnecessary expense. There were three other providers and there was no reason to have a fourth company. As a blog writer said, “the catastrophe was predictable.” And it was. The blogger is certain that the same fate awaits the e-toll business of the Orbán government.

56 comments

  1. Typical NIH (not invented here) idiocy of a totalitarian government. They will spend more billions and end up of with a non-working or barely working system. And a few years later they will scratch that system to build one that is compatible with the rest of the EU, for more billions, otherwise all European truck traffic will avoid Hungary, if at all possible. Maybe that’s the idea, improvement of the air quality…

  2. Just had a discussion about this with my wife this morning. My comment was there is no way that there is enough talent in Hungary let along available talent with large project experience, let alone anyone with experience with the type of technology that will be needed to make this work in 2 year time frame let alone any time this year. Too bad as I would prefer an electronic system.

    Any company working without experience in an industry on a fixed price contract is risking a huge loss unless they have some control over the schedule or the number of functional points that need to be implemented. I took a quick look at the Getronics website I see that they have the big software system experience but none of this appears to include hardware. So I suspect they could be able to pull it off but not without a huge amount of risk without the added problems of a short schedule.

    To give you an idea of the risk, current studies put software project failure rates @ 15%. However, the challenged category is running @ 51%. That means that only 34% of all software projects are delivered on time and on budget. This project adds in complex hardware plus mother nature, always a deadly mixture.

    My experience with this type of tracking came with I spent a wee bit of time with a system in London that collected GPS tracking data for one companies couriers as the wound their way through the city. That system was being used to schedule pickups and drop-offs and a whole host of other services. The implementation was very naive and that naivety lead to a system that was choking the companies ability to meet contractual SLA. That system had several years of engineering in it. We proposed a fix but the estimate for that work was at least 6 months… but this was just for fixing, not building from scratch!

    So, I’d be betting against electronic tolls in Hungary any time soon.

  3. The Orban government’s resemblance to the communist governments is amazing. These great plans remind me of the Office of Planning (Tervhivatal) of the communist era. This office came up with the grandiose 3 year later 5 year plans that planned out everything for the nation. We shall make this much buses, x% shall own washing machines, y% TV sets. Of course most of them was impossible so they just fudged the statistics or blamed the failure on the evil imperialists.

    The great Geza Hofi spoofed this saying the “third 5 year plan or the fifth 3 year plan – either way it is 15”.

    In another show he played a communist party secretary requiring the sows to farrow 14 piglets. Then the farmer went: “Have you informed the pig? You should do it. You know, same level …”.

    http://indavideo.hu/video/Hofi_Diszno_terv

  4. “The Hungarian government, instead of turning to T-Systems, the under-bidder, decided to go it alone as a kind of “general contractor.””

    As someone who spent 30 years in IT, I can confidently say that this has ‘unmitigated disaster’ written all over it.

  5. According to portfolio.hu there where four bidders to this project. The two highest bidders where also the ones which have the most experience in this field. Besides the amount of the bid, time is of the essence in this project according to VO. If you ask me the government will fail miserable, but they use EU funds and tax money to fill their coffers.

    I wonder if this was the reason why there is a carousel of resignations going on. I do not know the exact titles, but first the guy from the ministry of EU funds, a position of trust, than the CEO of the mobile operator, now rumor has it that Matolcsy will not be the new MNB president, but somebody else.

    http://www.portfolio.hu/en/economy/hungary_e-toll_system_orban_plans_to_succeed_where_germany_failed.25473.html

    Also they seems to have 4-5 concepts regarding this toll system. Most likely they learned this from the tender and subsequent conversations with these tenderers:
    http://www.portfolio.hu/en/economy/hungary_mulls_4-5_concepts_to_solve_toll_road_jam_govt_spokesman.25474.html

    I wonder how many Companies in future will tender, as the Hungarian government does not act honorably?

  6. Curiously, I don’t remember there being toll roads as you describe in 1998. There were hardly any motorways at that point. I’m not disputing you are right, just puzzled why I don’t remember. But the matrica system was decent. You bought a four day sticker for a not unreasonable amount of money and could use the roads. Imagine the tail backs if there were toll gates outside Budapest on a Sunday evening?

    Much as I love Orbán bashing, I think getting rid of toll gates was a good idea. And remember that if you want to travel a small distance, you used the old roads.

    But to the main point, I think you are misinterpreting what has happened. A GPS toll system could have been built. It is much easier now because GPS etc is now tried and test technology. And some of those bidding would have been able to produce such a system. What is going to happen now is that Orbán will get those same people to build it (by approaching the same subcontractors), pump up the actual budget (out of the reserve), and that way, 25 to 30 percent will be siphoned off to Simicska. They aren’t seriously going to try to innovate their own system, this is just a tried and tested money for embezzlement (one that MSZP employed too, to be fair)

    The reason will very likely fail is because it will still require competent project management, something that Fidesz is hopeless at. But that then gives the government more excuse for pumping more money into it. In the end, there will probably be a system in about two years time and SImiscksa’s wallet will be about 25 billion forints thicker

  7. Sorry, my fingers really don’t do what they are told! The sentence “this is just a tried and tested money” should read “this is a tried and tested method.”

  8. Kormos, the problem is that the EU limits the fees the operator can take in the current system (which fees does not depend on actual usage: you pay the same if you use the highways 3 times a day or only once and you don’t pay at all on smaller roads). Ib the new system, trucks (it will apply only to heavy duty machinery) would end up paying 10 times as much, and since we are a transit country, this is important (e.g. currently trucks skip Austria and use Western Hungarian small roads to save a lot of money).

    The state will still have to organise public procurments only very private snap procurements, There are only 3 firms with enough experience to provide the gizmos what you need to build in the trucks.And they will not produce at orders, which is the style at Orbán. They think that by Noth Korean style management they will be able to build it out. It is impossible. But they will start to work, burn a lot of money (yep) and the whole project will slowly die and nobody will care about it (most important, as the elctiosn are coming). Case closed.

  9. Well I remember that I had to pay something like a 1000 HUF toll to use the motorway from Vienna/Györ to Budapest in the mid 90s when I visited my sister – she sent me a 1000 Forint note by post so I would not have to exchange money at the border …

    I found that rather expensive – the price for gas was around 90 HUF per liter and one Deutschmark was also worth around 90 HUF, so at least gas was cheap.

    A bit more OT:

    And wining and dining in Budapest and later near the Balaton also was a fabulous experience although it was difficult to find an open restaurant or Hotel – except for Hévíz …

    That’s what prompted me later to buy the old farmhouse near Hévíz, because it was the only place near the Balaton which wasn’t closed down at the end of the summer season …

  10. Ron :
    I wonder if this was the reason why there is a carousel of resignations going on. I do not know the exact titles, but first the guy from the ministry of EU funds, a position of trust, than the CEO of the mobile operator, now rumor has it that Matolcsy will not be the new MNB president, but somebody else.

    Annamaria Szalay? I heard she has the required experience as she has a bank account. Rozsa Hoffman also carried an offertory box around in her church once. (Just kidding. Although in the current government experience and education matters the least.)

  11. Kingfisher :
    Curiously, I don’t remember there being toll roads as you describe in 1998. There were hardly any motorways at that point. I’m not disputing you are right, just puzzled why I don’t remember. But the matrica system was decent. You bought a four day sticker for a not unreasonable amount of money and could use the roads. Imagine the tail backs if there were toll gates outside Budapest on a Sunday evening?
    Much as I love Orbán bashing, I think getting rid of toll gates was a good idea. And remember that if you want to travel a small distance, you used the old roads.
    But to the main point, I think you are misinterpreting what has happened. A GPS toll system could have been built. It is much easier now because GPS etc is now tried and test technology. And some of those bidding would have been able to produce such a system. What is going to happen now is that Orbán will get those same people to build it (by approaching the same subcontractors), pump up the actual budget (out of the reserve), and that way, 25 to 30 percent will be siphoned off to Simicska. They aren’t seriously going to try to innovate their own system, this is just a tried and tested money for embezzlement (one that MSZP employed too, to be fair)
    The reason will very likely fail is because it will still require competent project management, something that Fidesz is hopeless at. But that then gives the government more excuse for pumping more money into it. In the end, there will probably be a system in about two years time and SImiscksa’s wallet will be about 25 billion forints thicker

    My first serious bit of driving in Hungary was 11 years ago and there were only 3 motorways (M1, M3, M5 – the maps claimed there was a bit of the M2 as well, but we never found it!). For the M1 and 2, you bought a pass (for a week I think) before you joined the motorway, but for the M5 (which was then privately operated), you paid an extortionate amount at a toll gate and drove in splendid isolation on a nearly empty road. (I think the motorway was divided into two sections, a long bit from Kecskemét, and then a shorter bit as you approached Budapest?) We weren’t expecting this toll, so spent ages driving around near the approach roads trying to find a place to buy a matrica!

    These days there seem to be motorways everywhere (presumably all built with money from the hated EU?) And you buy some sort of pass (monthly, yearly?) that gives you access to all. This seems to be a better way of doing it to me. My father-in-law religiously used the 4 (an rather poor ‘A” road in UK terms) to get from Debrecen to Budapest, rather than pay to use the M3, but, now the system’s changed and there is a direct link to Bp, he uses the motorway.

    On a related note – for those of us who are close to a motorway, it’s made a huge difference to travel. I always used to look at a map, work out how long the journey would take, and then double it in the old days (it always seemed to take twice as long to drive anywhere than it did in the UK, I don’t know why), but now you can get from Debrecen to Ferihegy in about 2.5 hours. With the long-promised M4, it would be even quicker as the current route (M35, M3, M0, M5) is very roundabout. (Actually, I’m not even sure if the M4 is being built or may exist already – another problem with driving in Hungary is not being able to get a map less than 10 years old!)

  12. Getting back to Orbán’s mad plans (with my IT project manager/consultant hat on) – I saw many large projects die prolonged, painful, and very expensive deaths – we never seemed to learn. But the UK IT industry has at last got to grips with this (although there are still the occasional disasters). The trick is obviously very tight, comprehensive (and realistic) project planning and control, but the first, absolutely key, step is to be realistic about the project – can it realistically be done, how much will it really cost, will it actually produce the benefits claimed?

    If there are doubts about any of these questions, the project should be reviewed and either canned (It’s amazing how many of these developments aren’t actually needed, they are just someone’s vanity project), or broken down into smaller systems that can be phased in as required (or not).

    The other key aspect is to keep up with the technology and adjust the project’s scope and methods if there is a significant change in the technology in the meantime. I saw many a huge and expensive project lumber ahead for years, only to be finally implemented too late because much cheaper and easier technology had become available in the meantime (the classic example was the development of huge client-server systems, which were then made utterly redundant by the coming of the internet). This is also another very good reason for not making projects too big – technology changes fantastically fast in IT, any project taking fiver years to complete will be out of date by implementation.

    And ditto for the client’s requirements – with business methods and markets changing so rapidly these days, and entirely new businesses and markets emerging almost without warning, large, long-term projects are almost bound to fail to meet the client’s real requirements.

  13. Kingfisher :

    Curiously, I don’t remember there being toll roads as you describe in 1998. There were hardly any motorways at that point. I’m not disputing you are right, just puzzled why I don’t remember.

    But to the main point, I think you are misinterpreting what has happened. A GPS toll system could have been built. It is much easier now because GPS etc is now tried and test technology. And some of those bidding would have been able to produce such a system. What is going to happen now is that Orbán will get those same people to build it (by approaching the same subcontractors), pump up the actual budget (out of the reserve), and that way, 25 to 30 percent will be siphoned off to Simicska. They aren’t seriously going to try to innovate their own system, this is just a tried and tested money for embezzlement (one that MSZP employed too, to be fair)

    As for the first point. I have very good memory but others do too. I got the facts and figures from the Hungarian media. The gates were at the entrances and exists, not on the road itself. I agree that it is not a good system but at least it is fair.

    As for misinterpreting the case. I don’t think so. I just didn’t deal with the corruption aspect of the affair.

  14. @Ron “According to portfolio.hu there where four bidders to this project.” Yes, but my understanding is that two of them were excluded for “formal reasons.”

  15. Paul :
    Getting back to Orbán’s mad plans (with my IT project manager/consultant hat on) – I saw many large projects die prolonged, painful, and very expensive deaths – we never seemed to learn.
    If there are doubts about any of these questions, the project should be reviewed and either canned (It’s amazing how many of these developments aren’t actually needed, they are just someone’s vanity project), or broken down into smaller systems that can be phased in as required (or not).

    Given that any sensible route would be to piggy back off of existing mobile (T-Systems??) or GPS (Gentronics??) systems one would have to conclude that this will ostensibly a software project. To pull off this project in 6-9 months they will have to big-bang it which implies traditional waterfall and projects delivered that way tend to have a 15% success rate. Our projects are developed in 1 week sprints and using continuous delivered mechanisms. We can cut a new release on demand. It is this type of (agile) methodology that is driving up project success rates. However, setting up infrastructure to do this takes time which is why it’s most likely that they will attempt the big-bang.

    To Wolfi’s point about approaching sub-contractors. It’s almost impossible to get talent in Hungary. Not because there isn’t any. It that the talent is tied up. There is an outsourcing firm (now Russian owned I believe) in Budapest (Vaci u.) that is perfectly capable of delivering on this project. I was a bit surprised to not see them in on the bidding but then these guys are experts in near-sourcing and my guess is they passed figuring they were going to take a bath on it. These guys have so much of the needed talent tied up that there is very little left over. And what is left over has been snapped up by Lufthansa, and a number of banks and insurance companies that have off-site development teams located in Budapest.

    My guess is that Getronics would have taken this project in-house and only sub-ed out the hardware bits and things to do with language. T-Systems is mostly hardware and system support for T-Mobile. At least it’s that was in DE. In other countries I believe they do more software (customer care, billing, routing, text messaging, etc..) but much of that originates in DE. So reasonable guess would leave me to believe that T-Systems would have sub’ed and Getronics wouldn’t have though I’ve no idea who they’d would sub to. My guess is T-Systems just threw their hat in without any real expectation of winning. Getronics would have enough experience to know that they were risking taking a bath on the deal also.

    So, with these players backing off you just have to know this isn’t going to end well.

    I’m going to make a prediction. OV goes ahead with the project, they feed their cronies with the funding and after 2 years the next government decides to fail the project and hook up with the EU effort.

  16. muttdamon :

    Breaking News

    Tha Galamus blog will be back next week!

    Quite a development. Only three days ago I got a letter from Zsófi asking me whether I would add my name to a short list who are willing to approach people for financial assistance abroad. She sent me the text and asked my opinion. They were planning to translate it into English and German. Then I heard nothing.

    Something must have happened only very recently. Maybe some rich person decided to be generous.

  17. LwiiH – that’s pretty much how I read it, but I think your conclusion may even be a bit generous. My prediction is that either it won’t even start or that it will go tits up a lot quicker.

    As you say, their only option is big bang, and there’s no way they’ve got the talent in Hungary (or immediately available) to do that successfully – and, even if there was, they wouldn’t touch it. Typical of people who know nothing about IT commissioning vanity projects.

    Interesting to read how project development has changed though. I’ve been out of the business for 10 years and at that stage we’d only just started persuading people to do iterative development, or even to have project groups actually including users!

    I came into IT from both a technical and business background and was involved in the PC and mini systems development area from the beginning, so I had a very different attitude to project development and user involvement to the ‘big boys’. I fought a long, and mostly unsuccessful, battle for 15 years or more to get them to change their attitudes towards systems development. In the end it was the users finally getting fed up with the history of big project failures and the changes in technology that forced the change.

  18. OT, but regarding toll gates on motorways – the only ones we have in the UK are at river/sea crossings (apart from one privately owned motorway link, which I’ve never used). Some of these tolls are very expensive, to pay back the construction.running costs, some are subsidised by local government, some have been removed altogether.

    My only real experience with tolls and their effect on traffic flow is the Dartford river crossing, east of London (two tunnels and a bridge under/over the Thames esturary). The gates for this are massive, there must be 30 or 40 gates on each side, some of which are reserved for cars with electronic ‘Dart Tags’ which let the drivers go straight through. But there is still congestion at some times of the day, occasionally quite serious.

    Given this congestion (and that this is on the M25, one of Europe’s busiest roads) and the cost of running the toll gates, I have never understood why they don’t just make the crossing free (as are all other Thames crossings). But what really puzzles me is that they don’t adopt the system that is common elsewhere of only charging one way. They would lose very little this way, as there is no really viable alterative, so most people wouldn’t be able only to use the crossing in the free direction, and the costs and congestion would be halved.

  19. There were real toll roads in Hungary, especially the one to Szeged, however the Socialist government thoght that it was a constant reminder that the foreigners were living off from poor Hungarians asking a hell lot of money for a drive that cost a fraction elsewhere, so by the time a Socialist party congress was held in Szeged (in was 2004 or 2005) the toll road was abolished and M5 was included in the sticker system. Whatever.

  20. Eva S. Balogh :
    @Ron “According to portfolio.hu there where four bidders to this project.” Yes, but my understanding is that two of them were excluded for “formal reasons.”

    Initially their were accepted. Something happened in December. I believe that during the negotiations the Hungarian government was pushing for a deadline, and penalties there after if it was not finished either on-time or not properly finished.
    http://www.motorway.hu/AAK_Cikk/2012/11/PR20121105

  21. Talent is a very misleading term. It is often said that people (well, Hungarians) are talented, They would be capable of doing something, if only.

    If only this or that.

    There is no such thing as a raw individual talent of which we hire 200 and tehy will deliver. Forget it.

    In a huge project like this (or an Olimpics or the much-delayed Berlin airport) or even a small project, people need to work in a team, they need to be managed, have to work together with the client, with the suppliers, there need to be an organisational memory, they need to make sure intellectual property are honored, licenses are negotiated and so on.

    Based on these requirement, there is no way, that a straight Hungarian bunch (like any state owned entity) can in itself deliver the e-toll system, not by mid-year, not by year-end. It is impossible. Since Getronics never delivered such system, they would not have been able to do it by the deadlines. It will be now much slower, but the opportunity to steal money will be even bigger. There are very few if any organisations in Hungary which have the experience of rolling out a project on such a scale with such tight deadlines.

  22. As to the toll highway in Hungary. It was totally irrelevant whether there were toll roads. In 1995 Hungary had no completed highways:
    There was no M0, M1 was completed up to Gyor, M3 up to Miskolc, M5 up to Kecsekemet, M7 to Siofok, M6 and M2 not even existing. At that time the M2 was financed via the EU fund Phare, and it took a long time

    The Horn Government decided that quick development was necessary and therefore entered into contracts with South African Company and a French Company. So the M1 and M5 became toll roads from Kecsekemet and the M1 from Gyor to Hegyeshalom.

    Both were finished in 1997/1998. In 1999 the Orban government decided to do it different, and made it a nationwide matrica system, and in that period they only completed the 3 lane M7 making his father rich.

    Now he is making himself rich by starting to do this electronically. HUF 40 billion is a lot of money..

  23. @ Hempi. Do I understand you right? I read: EU prohibits to raise the vignette price for large (long&heavy) vehicles, but allows to build a new, so called electronic system, whereby the Country could charge 10 times of the present fee. There is got to be some way around this.

  24. You’re taking it all wrong here!

    In reality, this is an ingenious defense plan: instead of erecting the ‘Great Hungarian Wall’ all along the borders, the cunningly clever Hungarians find another sophisticated and contemporary solution to make the country inaccessible to ‘the enemies of Hungary’!

    Just wait and see, pretty soon everyone will follow us – just as they copying our unorthodox method of becoming a financial ‘Super Power’ too….!

    Thanks to our Great Leader, of course, and the sometimes hmmm… complicated (financial!) view of His Right Hand.

    God bless them, as they deserve it!

  25. Spectator, this will mainly force the trucks from Russia, Poland, Ukraine etc to make a detour when traveling to the Mediterrenean ports like Triest, Koper, Rijeka …

    Now when we return home to Hévíz at night (say from Budapest) we see convoys on the M7 south of the Balaton. Also the M1, M5 and the (M)4 are heavily used – we try to travel to our relatives in Eastern Hungary only on Sundays.

    And also the Romanians “commuting” to work in Italy will have to find alternative routes …

    But, as the blind man said: We’ll wait and see …

  26. On reason I didn’t mention the possibility of corruption in connection with the e-toll system because I heard only rumors concerning Simicska’s role in the affair. Simicska and Orbán are very close business associates and at the moment it is hard to imagine that Orbán would allow to risk the EU subsidies because of too a high deficit that may result from not being able to connect the necessary revenues.

  27. Eva S. Balogh :
    On reason I didn’t mention the possibility of corruption in connection with the e-toll system because I heard only rumors concerning Simicska’s role in the affair. Simicska and Orbán are very close business associates and at the moment it is hard to imagine that Orbán would allow to risk the EU subsidies because of too a high deficit that may result from not being able to connect the necessary revenues.

    VO is not risking anything, unless he is re-elected in 2014. Than he may have a problem, as to EU subsidies. I understand that the EU auditors department, or actually control department, consist mainly of lawyers, and they had absolute no idea how to spot corruption. Now there is new management and they replaced these lawyers with auditors resulting that the Czech Republic is penalized for not correct usage of EU subsidies. Mind you it is a very small amount compared to 100% misuse of subsidies re. 2005.

    The same is applicable to Hungary, but most likely in 2015-2016.

  28. Kormos, yes, read me right. The EU wants to encourage countries to introduce actual-usage based systems, so the EU maximizes certain fee amounts, if the country uses a different system.

    The whole new system will apply only to trucks (vehicles over 3,5tons) for various reasons.

    But I guess it is logical that if you use a road more often, you pay more.

    Plus the fees will be in line with Slovakia, Austria, Czeh Republic.

    That is the extra HUF 75bn we are talking about, what we will miss from the budget.since the system will not be operational this years (Since you already pay for the Hungarian roads, at present only for highways, there would be no increase in revenue just by switching to special gzmos instead of stickers. More revenue is expected if fees will paid based on actual kilometers run).

  29. Ron :
    As to the toll highway in Hungary. It was totally irrelevant whether there were toll roads. In 1995 Hungary had no completed highways:
    There was no M0, M1 was completed up to Gyor, M3 up to Miskolc

    In 1995 the M3 didn’t get past Gyongyos. I forget the time table but it didn’t get the next 40km for quite some time and even longer to get to Polgar. Now it ends just south east of Nyiregyhaza but this last section took years to build as construction got hung up by archaeological finds and environmental challenges to the original route as it passed through sensitive wet lands.

    @ Pttrghd, yup, team work with good management is a must. I should add that the mostly Hungarian team working at what used to be called Phantom (Vaci u.) worked very well together. They delivered on some very large projects and had earned the distinction of being a MS gold partner meaning they had the keys to the MS source code vault. There was another startup in Debrecen that I visited for an afternoon. That team seemed to work well together but they simply couldn’t get enough talent. They made the dreadful mistake of buying a small consultancy just to get to it’s employees. Eventually lack of talent drove development back to San Fran. Well that and lack of good transportation.

    A wee bit OT but transportation to the eastern part of the country is a real impediment to economic development. The only airline flying into the Debrecen airport is WizzAir and that is one flight a day too/from Luton and that on a dreadful schedule and dreadful service in Luton. People seem to be working to get airports in the western part of the country where they are competing against VIE and BUD… mistake IMHO, the big opportunity is more flights to the eastern part of the county. Without this type of link it’s almost impossible to get business people outside of Budapest. With Ferihegy being no more than a regional airport it means that you can’t get in, get to your meetings and get out in one day unless you’re located in Budapest.

  30. LwiiH – I would LOVE more flights from the UK to Debrecen – especially ones that didn’t mean you (and two young kids) turning up at a God-forsaken place like Luton at 5 in the morning!

    But I can’t see it – there just isn’t enough happening in Debrecen, or anywhere that’s easy to get to from there. The East is poor and empty.

    I also strongly suspect that the current WissAir flights were a shot-term political ‘arrangement’ with Kósa connected with WizzAir being granted the ex Malév slots they wanted at Ferihegy. They certainly don’t make sense commercially – and previous attempts to run regular services to/from Debrecen have failed very quickly.

    We are about to book our summer flights and will be trying the WizzAir Debrecen route for the first time, so I fully expect that the deal with Kósa is due to run out any time soon and by July these flights will have ended!

  31. Another thing about Hungarian motorways that puzzles me (a lot) – why are most of them only 2 lane?

    OK, so that might have seemed reasonable in the early M1/M3/M7 days, but the whole point of the EU investing in Hungarian roads is that Hungary is so obviously central to a lot of trans-Europe road traffic. Experience everywhere tells us that as soon as motorways are built they start to fill up, much of the traffic actually generated by the existence of the motorway itself – building a mostly 2 lane system to connect so many EU countries together seems like terminal madness.

    In the UK our earliest motorways were only 2 lanes, but by the time the motorway programme was seriously underway, 3 lanes was the minimum, and these days our motorways are constantly being widened – up to 5 lanes in places – there are very few 2 lane sections left. And we are an island whose roads lead to nowhere else – not a country slap bang in the middle of the EU!

    As soon as the connecting motorways in Romania, Serbia, Croatia, Ukraine, etc are finished, Hungary is going to gridlock completely – and Hungarians are going to have to put up with endless years of disruption as the motorways are widened. All of which could have been prevented with a bit of foresight.

  32. And one more from me tonight…

    Does anyone remember when the M0 (my favourite motorway name, incidentally!) had no central reservation?

    If memory serves, it only connected the M5 and the M7/M1 in those days, and it was the sight of our first real brush with death on Hungarian roads, when the car in front of us in the ‘fast’ lane decided to do a U turn onto the other carriageway, without any warning!

    Various Hungarian drivers have tried to kill us several times since, but that episode still haunts me.

  33. Paul :
    Another thing about Hungarian motorways that puzzles me (a lot) – why are most of them only 2 lane?

    Classic case of under planning that seems to be rampant here.

    The flights I’ve been on from Debrecen were pretty full. They seemed to have attracted a lot of Romanians which is what I’d expect to see. The problem is Luton. Service there is so poor that it completely negates the advantage of not having to travel to Budapest. Anyways, lets see what happens over the summer.

  34. On my few flights from Luton I’ve found the airport very easy – you get through all the check-in/security nonsense in half the time (ditto getting out of the airport). The problem for us is purely location, as we live in Kent and have lost our direct Thameslink train service – and of course the crazy Wizzair departure times.

    But the chance to avoid the long, slow train trip from Ferihegy to Debrecen (now made even more difficult due to the switch in terminals), is worth the extra hassle of getting to Luton. Unfortunately, with no car and two young kids, the early departure time is the real show-stopper.

    WizzAir’s prices are quite steep compared to eJ as well – especialy if you’re limited to non-term time flights.

  35. PS – the M3 STILL isn’t complete! There was supposed to be a spur from the M35 Debrecen extension, north of the city, connecting to the 4 to Nyíregyháza, but it was never completed and just ends in midair just after it crosess the 35.

  36. And more on the M3 – from memory this is 2 lane all the way, even the newest bits. And yet it serves three main communities: Miskolc, Nyíregyháza and Debrecen – as well as future connections to Romania and Ukraine. Where the future traffic will almost certainly justify at least two motorways, they have chosen to build one, with (effectively) three – or five! – feeder roads.

    It’s a bit like combining the M5 and M6 and just building one motorway, with spurs to both Pécs and Szeged (and all routes to Serbia) – only worse.

    A future M4 (although I don’t expect to live to see it built) will help to ease the load, but most of the external traffic will still use the M3.

    I suppose Orbán’s plan (assuming he has one) is that he won’t need a viable motorway system during the lifetime of his government, as he will have crippled the economy so comprehensively that few people will be able to afford to drive or buy imported goods. And, of course, the lorries crossing Hungary will be pouring money into his treasury – and his mates’ back pockets…

  37. What can be added?
    90% of the people are decent, honest, and moral.
    Unity is still missing, and slogans can divide them.
    So old lying orban could be swept to the top.
    He became the permanent champion of the fools.
    The rest of us can hope for a miracle.

  38. There is a reason why there are so many two lane roads. As mentioned one reason under planning and the other environmental issues. but in Hungary corruption was the main reason. To build a stretch of one kilometer of road is 5 times more expensive than Germany, 3 times more expensive than Holland.

    As to not finished roads. Why was there never a motorway between Pecs and Szeged and/or a high speed train service between these two cities?

  39. No, there is no need for 3 lane roads. Has anybody driven on the M6 on a normal workday? It is almost empty, way below any projections. There are busier highways, but a highway far from Budapest (eg. close to Debrecen) is almost always empty (as a practical matter). M7 after Siófok in the winter is dead. Only the Vienna Budapest and Budapest Szeged highways are more or less busy. So there is simply no need for three lane highways, in many cases not even highways are needed.

    As to Pécs-Szeged, peopel don’t even travel between Budapest and Pécs, there is simply no business between Pécs and Szeged. Both are small towns and have no social, economic ties, never had. Similarly Szeged people don’t travel to Békéscsaba etc. in enough number.

  40. Bengt, you miss the point of these roads. They are not there to let you or me drive from Debrecen or Szeged to Budapest, or even Balaton – they wouldn’t exist based on that criterion alone. The reason they exist, and the reason the EU has put so much money into them, is that they are strategic trans-European routes. They may be empty at times now, but once they are connected to motorway standard roads in the neighbouring countries – once they are serving their strategic purpose 0 then we’ll find out just how adequate 2 lanes are.

  41. Bengt: “there is simply no business between Pécs and Szeged. Both are small towns and have no social, economic ties, never had.”

    I think that your definition of small town is amiss. Both Szeged and Pécs have a population around 170,000. Szeged is the third largest city in Hungary. Admittedly, it is an unfortunate situation that in addition to an oversized capital there are relatively few large cities. Debrecen, the second largest city in Hungary, has a population of 200,000. So, in the light of these numbers you cannot call either Szeged or Pécs small towns.

  42. He may have the size of the ‘towns’ wrong, but I think he’s right about the few links/ties between Pécs and Szeged. Being separated by the Duna makes a big difference that far down river, there was historically very little significant cross-river traffic in that area, and, even with today’s bridges, the river still makes quite a sociological/psychological barrier, if no longer an actual physical one.

    At times of floods, this is really obvious. I don’t know what it’s like now, but, in the past (and before the M9 crossing was built), if the Baja crossing was closed, you had to go a very long way upriver before you could cross. On one occasion, we couldn’t even cross at Dunaföldvár. (Eventually they did let us across, but there was a huge wait because ‘farm traffic’ had priority!)

  43. This makes such sadly familiar reading. A few years ago I was spending a lot of my spare time as an activist (here in the UK) for NO2ID, campaigning against the proposed new UK ID cards – which, if you believed the government PR, would protect UK citizens from a multitude of unpleasant things, ranging from illegal immigration, through identity theft, to under-age drinking. I’m pretty sure they were going to protect us from catching a cold or suffering from unhappy love-affairs as well.

    To achieve all this, the scheme would have required an immensely complex, unique and expensive IT system and the imposition of unprecedented inconvenience and intrusion on citizens’ lives. But the government insisted on pushing on with it, and that the scheme would be at least cost-neutral. NO2ID’s original arguments were on privacy grounds – but we quickly found, even disregarding that line of argument, that the whole thing was completely impractical from a technical point of view. As time went on, more and more IT industry experts came forward with their opinion that they whole thing would be an expensive flop.

    There are so many similarities in this Hungarian e-toll idea. Government “grands projets” pigheadedness. Incompetence in procuring large-scale technical projects. Shady links between the government and the providers. Insane optimism about the costs. Blinkered refusal to listen to what the rest of the world might be doing. (In the UK case, the LSE published a detailed study outlining a more minimal, far cheaper system, which really might have been of great benefit – the government response was to smear the author). Exceptionalism: in our case, we were told that no actually existing ID system in the world was good enough for the “unique dangers and challenges” facing the UK. But at the same time, we were also told that the proposed system was no more intrusive or expensive than a continental-European “laminated piece of card” ID system. Between those two statements, something smelt…

    Luckily, in the UK ID case, the whole thing was scrapped after only £millions had been spent, rather than the £billions the whole project would have wasted.

    Many of Orbán’s insanities are perhaps Hungaricums: but sadly, the kind of stupidity evidenced by this e-toll scheme is universal!

    Aren’t Hungary and Hungarians a bit short of money at the moment? I hope this stupid idea can be stopped before it wastes more money.

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