BUDAPEST, June 5 (Reuters) - Hungary's government will submit to parliament next week anti-corruption legislation needed to release billions of euros worth of suspended European Union funding, Transport and Investment Minister David Vitezy said on Friday.
Prime Minister Peter Magyar, who ousted veteran nationalist leader Viktor Orban in an April election, secured the release of 16.4 billion euros ($19.1 billion) last month on promises to scrap Orban reforms deemed by the EU to have harmed democracy.
Hungary's forint currency and bond markets have rallied strongly on Magyar's pro-EU pivot and his pledge to prepare the country for adoption of the euro by the end of this decade.
"This will be a comprehensive anti-corruption bill that also improves the transparency of Hungarian public life," Vitezy told reporters. "This represents the rule-of-law criteria that will allow us to bring the EU funds home."
He said the legislation would enable Hungary to tap up to 10 billion euros from the EU's pandemic recovery fund to finance transport and renewable energy projects, as well as funds to support small businesses and rental housing construction.
TRANSPARENCY
The reforms will boost the powers of Hungary's Integrity Authority, an anti-graft watchdog, and create more transparency in the asset declarations of public officials, with any omissions punishable by up to two years in jail, Vitezy said.
He said the government would inject some 3.5 billion euros of EU recovery funds into the state development bank MFB to help finance some of these projects and avoid any loss of funding ahead of an end-August cut-off date.
Hungary will also be able to offset 2.6 billion euros worth of investments previously drawn from its own resources with EU funding, Vitezy said, boosting the government's room for manoeuvre with the budget following a surge in the deficit driven by heavy pre-election spending under Orban.
Vitezy said some 4.2 billion euros of EU cohesion money would be used to finance investments in railways and transport infrastructure, while another 2.2 billion suspended over an erosion of academic freedoms would be spent on higher education.
($1 = 0.8593 euros)
(Reporting by Gergely Szakacs and Paweł FlorkiewiczEditing by Gareth Jones)
