The EU announced €750 billion of the €1.8 trillion budget will be used as a Coronavirus Recovery Fund to help rebuild the bloc following the deadly pandemic, which has ravaged economies around the world.
However, the EU wants to link the behaviour of member states with access to EU funds by means of a “rule of law” mechanism.
This means any country which pursues policies which the EU feels do not uphold its core values will lose access to the vital funds.
But last week, Hungary and Poland blocked the EU budget over the rule of law issue.
Mr Orban said this morning his country’s position on the budget and recovery fund is “rock-solid” and will not seek a compromise on the rule of law issue.
The bloc is investigating the nationalist government – as well as Poland – for undermining the independence of their judiciaries and media.
The EU sought to attach conditions to the disbursement of money.
Mr Orban claimed the EU cannot attach rule of law conditions to funds unless it changed its founding treaty.
Both countries blocked €1.8trn worth of funds, including hundreds of billions due to be disbursed to help the bloc recover out of a double-dip recession.
Following Mr Orban’s comments, a senior EU diplomat said member states and European lawmakers have no appetite to renegotiate the condition.
They said: “With their statement, Poland and Hungary are moving deeper and deeper into isolation.”
Both Hungary and Poland receive some of the highest amounts per capita of any EU country.
While both need the funds to overcome the effects of the pandemic, their vetoes will be hard for the EU to overcome in passing the conditionality agreement.
Despite Hungary and Poland’s stance on the EU budget, other Member States have urged countries to work together.
Romanian Prime Minister Ludovic Orban called for EU states to “work together” adding: “We need to refocus and get this agreement done.”
With German ambassador Michael Clauss saying: “We have already lost a lot of time in view of the second pandemic wave and the severe economic damage.”