New leadership puts Hungarian left in place for a second term

HUNGARY: Prime minister Ferenc Gyurcsany looks set to lead Hungary's Socialists to victory in tomorrow's general election, despite a warning from the centre-right Fidesz opposition that he has taken the country to the brink of financial crisis.

After narrowly winning the first round of voting a fortnight ago, surveys show the Socialists and their allies also leading the way in constituencies where no candidate won an overall majority last time and which will be decided tomorrow.

Victory would be a personal triumph for Mr Gyurcsany (44), a millionaire former businessman and admirer of British prime minister Tony Blair, who took control of the Socialists two years ago when they were directionless and trailed Fidesz by a distance in polls.

Having faced down Fidesz jibes about the Socialists' Communist Party roots, Mr Gyurcsany overturned a 10-point opinion poll deficit in recent months to win the first round of voting and leave Hungary's conservatives in disarray.

If re-elected, he has pledged to tackle state sector inefficiency that has helped create a huge budget deficit, which undermines Hungary's preparations to adopt the euro. The health and education sectors are also in need of an urgent overhaul.

"The first 100 days must be about launching . . . decisive steps affecting the operation of the state," Mr Gyurcsany said, promising to submit 18-20 reform bills to parliament in the first 40 days of a new term.

"I do not want to be simply the custodian of the country, managing it on a day-to-day basis, I want us to create a better country," he added, "a more just Hungary that is not afraid of challenges and does not turn inwards, but moves forward."

However, Viktor Orban, Fidesz leader and prime minister from 1998 to 2002, said a second term for the Socialists would tip Hungary into financial chaos.

He backs deep tax cuts to spark growth, but the government says that would only leave the budget deeper in the red.

"We need to open Hungarians' eyes, to make them see what will happen if there's no change of government," Mr Orban said, warning of imminent economic breakdown.

"The car will stop, it has run out of petrol and we will have to get out. It's raining outside, we will be covered in mud to our neck and we will have to push the car to the next petrol station," he said.

Apparently stunned by his first-round loss, Mr Orban offered to stand down as the right wing's prime ministerial candidate in a bid to woo a smaller party into an alliance, but he was rebuffed and faces an uncertain political future if defeated.

In September, Hungary must give the European Union details of a plan to meet the criteria for switching currency to the euro - a move which Budapest has already put back from 2008 - but its deficit is currently much too large.