No good players, no spectators but more and more stadiums

There was great excitement in government circles yesterday in the wake of the news that the third quarter Hungarian GDP grew by 1.8%. Observers who look around the country couldn’t quite believe that number and skeptics immediately questioned the figures of the Central Statistical Office.

No, the numbers are not falsified, but if they are not put into context they are misleading. What the ordinary citizen, even the one who more or less follows the news, doesn’t realize is that a year ago during the same period there was a decrease in the GDP of 1.7% compared to 2011. Thus, this single figure simply indicates that we are where we were two years ago. Moreover, economic growth during the first three quarters of 2013 didn’t herald a robust recovery. It was a modest 0.5%.

Prospects for the future are not especially bright because investment is still very low and comes mostly in the form of large government projects financed by the European Union. Since the Orbán government stopped all convergence projects that were under way in 2010, only a fraction of the available subsidies was used as late as the summer of this year. Then János Lázár took over the office handling EU projects and promised to begin large and hitherto postponed projects in a great hurry. According to critics, the government has been spending money with very little thought for utility. I for one find it outrageous that billions of euros given to Hungary by the citizens of better-off countries in the European Union go for projects that have nothing to do with convergence.

Let’s focus on the most objectionable: football stadiums. As of August 2013 a total of 123 billion forints was set aside for stadiums whose construction was already under way. And announcements over the last few months indicated that the Hungarian government will spend an additional 110-130 billion forints refurbishing existing stadiums or building new ones. These new stadiums, taken together, will be able to seat about 110,000 football fans. In the fall of 2012 the average number of spectators at the matches of Division I was 2,807; this number decreased to 2,728 during the 2012/13 season. Attendance varied widely by club. Ferencváros averaged 6,174; Diósgyőr, 5,669; Debrecen, 4,400; and Szombathely, 3,433. Then there was Mezőkövesd with an average attendance of 800 and the famed Felcsút with a mere 300-500 spectators.

Some 80% of the population object to spending public money for building or refurbishing stadiums. As far as Felcsút is concerned, even the majority of Fidesz voters disapprove of Viktor Orbán’s pet project. Yet voter dislike of this stadium building frenzy didn’t dampen Viktor Orbán’s zeal. In the 2014 budget the government allocated an additional 82.8 billion forints for stadiums.

Two days ago Népszabadság learned that the cabinet had discussed refurbishing and/or expanding twenty-six existing stadiums. The cost will be 21 billion forints. Most of the money will go to Honvéd (Army) in Budapest. In addition, Pécs, Paks, Kaposvár, Nyíregyháza, Zalaegerszeg, Vasas, Cegléd, Gyimót, Kisvárda, Szigetszentmiklós and several others will all have stadiums. Soon there will scarcely be any larger than average size town in Hungary without a spanky new stadium. Someone wittily remarked that if sometime in the distant future archaeologists undertake extensive excavations in the Carpathian Basin they will wonder what all those oval-shaped foundations were used for by the people who lived here thousands of years before.

Bishop Kiss-Rigó plays football / MTI

Bishop Kiss-Rigó plays football / MTI

It seems that the football stadium mania is infectious. The Szeged-Csanádi Diocese started a business venture, Szeged 2011 Labdarugó Sportszolgáltató Kft. The bishop, László Kiss-Rigó, is keenly interested in football. He put half a million forints of his own money into the Grosics Football Academy in Gyula. He also put money into Profi Futball Kft. Now Kiss-Rigó wants to rebuild one of the two abandoned football stadiums in Szeged. Never mind that Szeged doesn’t even have a team. The diocese’s company will build a stadium–and maybe “they will come.”

The reconstruction of the stadium will cost about 2-3 billion forints, and the Hungarian Football Association (MLSZ) already promised the diocese-owned company 700 million forints toward the cost. The company itself hasn’t been doing well. In fact, just last year it lost 95 million forints. However, the bishop is optimistic that his business venture will receive a few billions from private donations–donations that can be written off on the donors’ taxes. Just as Felcsút managed to get 4-5 billion, Kiss-Rigó, a great Fidesz supporter, will most likely get generous support thanks to his connection to Viktor Orbán. As far permission from the city of Szeged is concerned, one doesn’t have to worry. Although the mayor is a socialist, the majority of the city fathers are members of Fidesz. They already gave their blessing to the bishop’s project.

But not all is in order in the Szeged-Csanád Diocese. The Hungarian equivalent of the Internal Revenue Service (NAV) is investigating possible tax fraud and other unspecified felonious acts. And that leads me to the surprising fact that businesses owned by church organizations have all sorts of privileges granted by the Orbán government that other businesses don’t receive. For example, lower corporate taxes, no taxes on company vehicles, and lower personal income tax rates for ministers and priests. The Democratic Coalition included repeal of these perks among the party’s sixteen points.

The investigation of the Szeged-Csanád Diocese is still under way. An earlier investigation into the crooked business practices of the Pécs Diocese ended the career of the bishop of Pécs.

It would be interesting to know the extent to which churches are engaged in business ventures and how much the Hungarian government is helping them along. In the Szeged case, the Hungarian Football Association’s 700 million donation to Kiss-Rigó’s business venture comes from the Hungarian taxpayers, who are most likely not terribly keen on a church-built stadium in Szeged.

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20 comments

  1. One minor correction:

    Honved is not located in Szombathely, it is in Kispest, Budapest.

    The Szombathely team is called Haladas, i.e. progress – a carryover name from Communist times.

  2. It’s such a commonplace these days to say how poor Hungarian football is and how few fans it has, that it came as quite a shock, whilst browsing for attendance figures just now, to discover just how much things have declined.

    If the statistics on the european-football-statistics site are to be trusted, the average first/premier division club attendance in the 60s was well over 10,000 most years, peaking at over 16,000 in 64 – the same year that the top club’s (Ferencváros) average peaked at nearly 44,000 (a very respectable attendance indeed – comparable to today’s top English Premier clubs).

    But after that it was pretty much all downhill. In the 70s the division average only got above 10,000 once and generally hovered around 8,000, whilst Ferencváros’s average gate was practically half of it’s 60s peak. The decline plateaued out in the 80s, but in the 90s it accelerated again, with the division club average never getting about 6,000 in the whole decade – almost half of what it was 30 years before.

    The 90s also saw the end of the Ferecncváros dominance, with Diósgyöri getting the highest average attendance in 1998 (12,588 – nearly 2,000 more than Ferencváos in the previous season).

    From 2000 onwards, attendances really collapsed, with the division club average not even reaching 3,000 in 5 years of the last seven years. Even the best club attendances in those years were a shadow of their former numbers – declining from 8 and 9,000 in the early 2000s to 6,000 in more recent years (in fact the figure has been under 6,000 for three of the last six years).

    To put these figures into context, the top Hungarian clubs are currently getting the sort of attendance figures that moderately successful clubs in the higher level of English non-league (semi-professional) football would expect.

    In just under 50 years, the top division club average has dropped from over 16,000 to under 3,000, and the top club average from over 43,000 to around 6,000 – a drop of between 80 and 85%. On the individual club front, Ferencváros, which dominated Hungarian football until the late 90s, saw it’s attendance drop from over 40,000 in the mid-60s to today’s average of under 6,000 – again, a drop of around 85%.

    Again, for context, although other countries have seen declines in attendance over the same time scale, I can’t think of any where it has been this dramatic. And in most countries, the figures have picked up again in the last 20 years, as football gradually lost its hooligan image. In the UK, although there was a dip in attendance when all-seater stadia were introduced, gates have steadily increased since then, and football is as popular as it ever was.

    Only Orbán could look at these figures and think of football as even particularly popular in Hungary these days, let alone its national sport.

  3. They should change the national sport to stamp and/or butterfly collecting or chess.
    The initial investment drops to the fraction of the stadium cost, and the injuries are reduced to almost zero.
    Less insurance premiums and medical bills. Less maintenance and upkeep, less overall fixed and variable costs.
    Not only it makes economic sense, it is also more entertaining.

  4. Dear Eva,

    This article is still not correct. Haladas of Szombathely will not get any money from THIS batch of 21 billion forints, despite of the fact that the Defense Minister was born in Szombathely.

    The main beneficiary instead will be the former team of the Defense Ministry,
    Honved of Budapest with 5.0 billion forints.

    see
    http://nol.hu/kep/832471

  5. Squandered money. And yet he has retained a level of support which beggars belief. I suppose refurbishing and re-equipping hospitals didn’t make the cut just because he really really likes football?

  6. Now heres another Orbanism: That of wasteful spending on soccer stadiums as if soccer will be played substantially better in more modern stadiums and in out of the way places like Felcsút…

    This is one I really can’t quite see through. I see most of his tricks, but this one, unless he is, once again, simply finding another trick to create humungous profit for the very limited number owners of a few private construction-companies.

    But really I am at a total loss as to what he is trying to achieve by making a few dozen people filty rich, and a few thousand people well-to-do, within a country that he is destroying in the process. What kind of place are these rich folk gonna be living in? Gated communities while destroying the entire economy for the long-run? Feeding the population with lies, manipulating, and legislating falsehoods?

    I am at a loss to understand what he can really achieve unless he is – and this is the only option I can see – that he is trying to make himself the focus of attention and the subject of thanks to the few adherents to his regime. Does he have any sense of social responsibility? Of realizing that the Hungary he says he is proud of is made up of an infrasructure and folk that canot be dug away into underground tunnels like rats would be…

    Its really beyond me as to what he is trying to achieve on the long term.

    I suppose we ‘simply’ have ‘found our very own national robber and team e.g. the ‘great train robberrs’ in the UK for example (the latter on a micro-scale) or more like the regime of a dictator of a Banana Republic or of a mining-rich African country, that is, a Mugabe, or an Assad, or any other dictotor-for-‘life’)… I am sad to say we have found him here in Hungary, our very own Orban.

    It just seems so odd that the general population canot see through the woods even in this European Land here, a country which was a primary candidate for finally fully joining the West.

    After all we too had been through the Renaissance, the Reformation, lived through the era of the French Revolution and then our own several Hungarian Revolutions, and suffered through the Turkish, the Austrian, the German and the ‘evil’ Soviet Regimes and suddenly, lo-and-behold we have now been HIJACKED by an internal enemy – something like a CANCER that is growing within our midst.

    We even have some good minds left, the know-how and the tools to politically operate on this cancer, and maybe a friend-or two abroad – though fast diminishing – to give us a hand to oppose this growing Cancer.

    Our gratest ENEMY which we are allowing FREELY to work for ORBAN is the inability of a very few of us to get together to plan a counter-attack !!!!

    ELEMENTARY STRATEGY 101.With just a FLASLIGHT you can find the cancer and operate on it if done IN TIME.

    You Wait and the Cancer of Orbán will eat us ALIVE

  7. As the country needs no more highways and Budapest no more subways, the football stadiums have become the new pet projects of party treasurers i.e. organised criminals.

    These opaque and totally unnecessary mega-projects suck in tens of billions of forints as black holes and the criminals can pocket at least one-third of the funds.

    If that is not enough, Paks-II is already on the horizon. Putin’s people are absolutely confident of winning it. That project alone would bog down the country for decades to come – and attach the country even more to feudal Russia.

  8. The real question is do the clubs want such huge structures, even if the EU pays for their construction? The running costs will be higher, and if they don’t have the gate revenue they will go bankrupt

  9. Max: Russia has to win Paks II and it will. There is no question about it. It would be total naivity to think that others may have any chances.

    See, the complete Hungarian nuclear establishment has been educated in Russia in one way or another. After all, Paks is a Russian technology and Russians supply the uranium rods. So in the last 40 years (30 since the actual start of the operation) these contacts have been kept warm. The top Hungarian nuclear people speak Russian, have Russian friends and so on.

    In addition, Russia will make sure not to lose Hungary, or any other market for that matter, to a competitor, knowing that a nuclear plant is a form of political power as well. Russia has interests in Hungary and it will do anything to keep those interests. As it is the case with Ukraine: Russia cares about keeping Hungary much-much more than any other potential service provider cares about getting Hungary as a new client. Likewise, the EU cares about Ukraine much less than Russia cares about Ukraine (ie. to keep it in Russia’s orbit), so no surprise Ukraine will forever remain in Russia’s orbit. Ukrainians may stage any number of revolutions, but they can’t shake off Russia’s embrace, after all, half of the country is Russian ethnically and energy (heating) comes from Russia.

    In addition, as you know, such a project is an almost unbelievable bonanza for decades for the political parties and it would be difficult to arrange that with the French or the Americans. I guess the South Koreans are a bit untested and the Japanese with Fukushima are not really competitive these days, as it would be much more difficult to sell the Japanese in Hungary politically. There is no way anybody can offer a better deal than the Russians can, and this is how you win: you want victory more.

    So all in all, Russia is in a pole position. And the project will start soon. (Interestingly, the Russians used to take away the spent fuel rods, now the pile just grows in Hungary, but who cares, we can forgive that to the Russians, they know how to sweeten a deal).

  10. A prophecy:
    When all the new football stadiums are opened and it is proven that those who are bidden will not come, the government will make an architectural competition, with exorbitant rewards and by invitation only, about how unused municipally owned structures can be rebuild to something else equally useless. The winning projects will be realized and cause a magnificent rebuilding boom for EU-money. When it is all over and the EU money is gone, even the employees of Közgép will leave the country.

  11. People here do not understand Orban’s foresight.

    He knows that at one point, he has to apply comrade Pinochet’s methods.

  12. @tappanch. Include me out! I have touched on the subject in a few comments. I prefer to call it the “logic of dictatorship” rather than “Orbán’s foresight“.

  13. NEWS NEWS NEWS

    Orbán is about to build secret bunker beneath Kiralyi Castle Dr Goldfinger Style…
    Planning for his doomsday just in case. War of the Galaxies.

    This establishment will assure drawing down the last available EU funds permitted for Hungary

    He’s also had Lipotmezo (the luny-bin in chique Buda hills) rebuilt with extra-high fortifications reserved for ‘his royal highness…’ just in case

  14. 007 :
    They should change the national sport to stamp and/or butterfly collecting or chess.
    The initial investment drops to the fraction of the stadium cost, and the injuries are reduced to almost zero.
    Less insurance premiums and medical bills. Less maintenance and upkeep, less overall fixed and variable costs.
    Not only it makes economic sense, it is also more entertaining.

    Hmmm.
    Sorry, no go!

    You see, one prerequisite of collecting stamps is – at least basic – literacy. Same for the butterflies, but you must add some level of understanding of taxonomy and biology in general. Playing chess even needs some basic mathematics, playing it well requires quite advanced level of strategical thinking, so, we are back at the soccer-fields…

    As you see, we have no choice, we need those stadiums very much.
    After all, it’s enough trouble already, that there is no bread to the masses, just imagine, what would happen if their circuses gone missing too..!

  15. It seems to me Hungarians are showing some common sense in not paying the premimum prices for soccer. In the US the bulk of American football fans attending National Football League games are working class males with massive debt levels. Yet they pay hundreds of dollars each year for tickets and hundreds more for team wear, beer, and to park their cars in lots by the statidums. Cars which by the way may now just be leased because their credit is so bad they can’t buy a car or SUV.

    It is an escape from reality that is heavily promoted by the media and the football league. At least Hungarians when faced with decking standards of living had enough common sense to stop paying up for tickets.

  16. Andy: “I am at a loss to understand what he can really achieve”

    From a practical point of view: rather broad control of the country and its resources. Probably he believes that he is the one who knows best what is good for Hungary and Hungarians, so he might also feel quite satisfied with his work (added advantage). Long-term objective: either none (full control of Hungary and of his own life/satisfaction during his lifetime) or being the greatest Hungarian next to St Stephen.

    But whatever his reasons are, your other points are exactly what has to be communicated to the public: “we ‘simply’ have ‘found our very own national robber and team” (can that be if so far it has always been the “foreigners” or colonisation??) and “Our gratest ENEMY which we are allowing FREELY to work for ORBAN is the inability of a very few of us to get together to plan a counter-attack !!!!” For which a more inclusive definition of the Hungarian nation is indispensable, and should be arrived at in the process. Currently it is “too easy” to exclude people (for alleged liberalism, religion, social background, past “sins” related to whatever could be connected with Communism and so forth).

  17. I’m pretty certain that the key to understanding all this stadium building is not the development of national football, but the prestige of being able to stage European football (probably in collaboration with another country – Slovakia, for instance).

    In order to put in a bid to stage the European Cup tournament, the bidding country doesn’t have to have any particular prestige in football (although Hungary does have that, thanks to the Golden Team), but simply has to have the infrastructure to stage all the games – including at least half a dozen international standard stadia (and one big one in the capital, where the finals can be held).

    At one stroke, Orbán will be able to claim he has restored Hungary to greatness and achieve his childhood dream of watching a major international football tournament take place in his own country.

  18. Dear Paul, it has not much to do with national achievement in general.
    We must face and accept the fact, that he likes it, and he can do it. It’s about enough nowadays, you see.
    Actually – and perspnally – I have problem with people, who objects and complains – after all we’re all willingly accepted that we have a ruler and we are all exist only for the shear purpose of to serve him as his servants. What’s wrong with this?
    We wanted it, so we’ve got it.
    Hail to Viktor, the One and Only!

    I’ll go and get my medicines.
    What about all the others?
    Anyone?

  19. Paul: you are absolutely right, that is part of the strategy. These sports games which Orban wants to have organized in Hungary are just a prelude to the biggest prize of all: the Olympics. But behind it is the construction business, and long-term planning is important. Like with everything else, Orban plans for the future. With all the credentials with smallish international games (European Swimming Championships and whatnot), Hungary can eventually win one of the bigger games (eg. Football World Championship), which would be the ultimate bonanza, never mind the costs and burden, as in Greece. Hungary is a nation of sport and we will show it to the world. Counting the costs is just a bolshevik trick, we do not fall for bolsheviks.

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