BUDAPEST/OSLO (Reuters) - Hungarian government agents on Monday raided the offices of three non-government organisations that help distribute Norwegian grants in a conflict that has soured bilateral relations.
The Norway Grants, an agreement between the EU and Norway, Iceland and Lichtenstein about funding projects in less-developed European economies, have financed organisations that have criticised Hungary's government heavily in recent years.
Critics of Prime Minister Viktor Orban say his centre-right Fidesz party has been entrenching its hold on power since an election victory in 2010, eroding the independence of institutions such as the judiciary and the central bank. He was re-elected by a landslide in April.
After the government appointed Fidesz loyalists to lead public institutions and fostered a deferential media culture, many NGOs fear they may be the next target.
The government rejects this charge and says the Norway Grants found their way to a small green-liberal party, Politics Can Be Different (LMP), which scraped over the 5 percent minimum threshold with 5.3 percent of the vote in April's elections.
Shortly after the elections Orban's chief of staff Janos Lazar wrote to Norway's EU affairs minister Vidar Helgesen that he saw signs Oslo was trying to influence Hungarian politics through the grants.
"You dedicated a key role to this party when the grants were assigned," Lazar wrote. "I get the impression that you support a one-party democracy in Hungary, with the one party you like."
In an emailed statement to Reuters on Friday the government said it had no intention of fighting individual NGOs, but it repeated the charges that the grants sought to exert political influence.
It added a list of recipients it considered problematic for "leftist political ties", such as Transparency International, the Hungarian Civil Liberties Union or the investigative journalism portal atlatszo.hu.
The organisations typically received around 100,000 euros (81,224 pounds) each from the Norway Grants. Norway is not an EU member but has a separate association with the bloc.
Helgesen told Reuters in a phone interview on Monday that Norway would continue funding the grants and carry out its own audit that is due in the autumn, adding that Budapest had agreed to the terms of the funding scheme it now attacked.
"It would not have been in our interest to support any individual political party," Helgesen said. "That accusation is hard to see the basis for... There's no (unilateral) action the Hungarian government can take to alter the way the funds are managed."
"There is a shared European concern about the weakening of democratic institutions and processes (in Hungary), such as the constitutional court, the legal system, the electoral commission and of course the space for the media and others to enjoy the freedom of expression. There are infringements here that are cause for concern."
The government has led an escalating campaign accusing the four NGOs that helped Norway disburse the grants of political meddling. It said the Government Control Office (KEHI) would audit Okotars, the lead NGO in the disbursement effort, but sent KEHI agents to two other partner organisations as well.
The agents wanted to see virtually all documents related to the Norway grants, lists of winners, losers and emails among the organisations that managed the grant, the web site index.hu quoted one of the organisation leaders as saying.
LMP co-chair Bernadett Szel rejected the charges that her party would benefit from the Norway Grants and said the government's actions may destabilise the non-government sector.
"To Janos Lazar, the non-government sector is just another area to occupy," she wrote in a statement late on Friday. "LMP rejects the charges... and considers it outrageous that (Lazar) wants to use made-up charges to undermine a working system."
The government said it had no intention of taking up a fight against individual NGOs, but it repeated the charges of political influencing in an emailed statement to Reuters.
Atlatszo.hu board member Attila Mong told Reuters he had no doubt that the government had set out to cut that lifeline from the organisations it considers unfriendly, adding there were almost no other financial sources to replace these grants.
"Orban's message is clear: he wants his hands to be the only ones to feed NGOs," Mong told Reuters. "If you don't want it, you will starve."
Reporting by Marton Dunai; Editing by Ruth Pitchford