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Oct 26, 2018

Hungarian government announces extension of the ‘CSOK’ family allowance scheme

The extension comes in light of a government announcement surrounding the transformation of the government supported Home Saving Fund System (Lakástakarékpénztár)

The Hungarian government has announced that it is extending the ‘CSOK’ family allowance scheme.

The extension comes in light of a government announcement surrounding the transformation of the government supported Home Saving Fund System (Lakástakarékpénztár). Previously, the state had increased its funding by 30 percent but the system will no longer be subsidized by the government moving forward.

“The existing Home Saving Fund System (Lakástakarékpénztár) does not serve home-creation goals effectively, while service providers “cashed in” with extra profits," said Erik Bánki, MP of governing party Fidesz and chairman of Parliamentʼs Economic Committee.

The withdrawal of state aid and the transformation of the Home Saving Fund System (Lakástakarékpénztár) will happen in a form that guarantees no loss to any party. The government will continue funding contracts already actioned, but state aid will no longer be provided after the amendment comes into force.

In contrast, the Family Housing Support Program (CSOK) has already helped 81,000 families to buy or extend their homes. The transformation of the current system enables further support for the extension of CSOK.

“The resources released from the transformation of the Home Saving Fund System (Lakástakarékpénztár) will be spent on extending the Family Housing Support Program (CSOK)," Gergely Gyulyás, the minister heading the Prime Minister's Office, said.

The further extension of CSOK is only the first step, he said. “The government will announce details of a national consultation on families, and depending on the results, further family and housing support decisions might be adopted," the minister added.

However, sources suggest that the current 10 million HUF cap on home subsidies would be extended to 15 million HUF.