Building of the former Ballet Institute

hvg.hu: Wasn't your criticism of Terezvaros council excessive? Can you provide concrete proof?

Zoltán Illés: I'll repeat: Terezvaros has not had a good reputation for a long time because of its scandalous real estate transactions. There have been a whole series of inexplicable property sales, which have scandalised half the country. Many palaces on Andrassy ut were sold in this way, as was the former Ballet Institute. But then there was the sale of a shopfront at 61 Bajcsy-Zsilinszky ut, and the bribery that was linked to it - in this case there was a prosecution and imprisonment.

hvg.hu: That's a pretty frank thing to say. It's hardly a surprise that they're suing you.

I.Z.: One minister tried to spread rumours when he would have done better to solve the problem rather than try and cover things up. The politician in question is Miklos Persanyi, who was talking about pollution at a Csepel rubber factory. He said there was no pollution and that it was unnecessary to scare people with stories like that. His successor, Gabor Fodor, disagreed, saying I was right. He said there had been a risk that they had dealt with. "We should congratulate Zoltan Illes for drawing our attention to this," he said. Istvan Verok could learn from this example, perhaps by realising that people who draw attention to abuses shouldn't be reported but that the relevant lessons should be learned to stop the original abuses from being repeated. If certain Terezvaros councillors had refrained from stealing, they wouldn't now be under suspicion. Of course, this is now a problem for the law enforcement authorities to deal with.

hvg.hu: Let's stick to one concrete story, that of the shopfront at Bajcsy-Zsinlinszy ut 61. It's former tenant, the director of MUART Press, Karoly Berecz, reported the council, saying that one of its staff had asked him for a Ft18m bribe to sell the space. Didn't opposition councillors know about this? And if they did, why didn't they do anything about it?

I.Z.: It's good that you mentioned this, because I've been sued in connection with this affair because I mixed two people's names up on a TV show. I said Peter Kovacs, then head of the council's property management company, took bribes, when in fact it was Karoly Juhasz, a businessman, who was caught by the National Investigations Office in January 2008. Given the fact that the police arrested both people, my mistake can be forgiven. The recordings obtained by the Investigations Office show that somebody asked for the Ft18m in bribe money in exchange for arranging the sale of Bajcsy-Zsilinszky ut 61.

hvg.hu: But why didn't opposition councillors attempt to stop these transactions?

I.Z.: We did what we could. Fidesz and the Christian Democrats have nine votes on Terezvaros's 25-member council. The Socialists and the Free Democrats are in the majority. Between 2002 and 2006, we criticised every single property transaction that came before the council, opposing them at the committee stage as well. We stressed that we did not agree with what was going on. Our fundamental position was that we wouldn't sell properties, whether to individuals or companies. Properties can be rented. We voted against every single sale. When we saw that properties were being sold for less than their market value we reported this.

hvg.hu: You were sued for claiming that "the sixth district sold properties in just the same way as the seventh district." Do you continue to maintain this?

I.Z: The procedure was identical. "Project companies" were created for each individual property, which were bought by larger off-shore companies. These companies were registered somewhere else in the world, and the Hungarian justice system can't investigate them. The properties weren't bought but the off-shore companies that owned them. These transactions are legal, but given that theses are often listed buildings, the law should be changed. Look at the Post Museum building, with its beautiful glass windows and unique chandeliers. The council was expected to cut its selling price since the buyer would have to preserve these artifacts. Similar things happened in the case of the Ballet Institute. The council sold it for Ft1.2bn. In return, it committed itself to moving the Ballet Institute into a new building for Ft600m. They were meant to use the rest of the income to relocate the building's other residents, which would cost about Ft300m - meaning the council earned Ft300m from the transaction. That building is now being sold for something like Ft10bn - without any change at all in the building's condition. It's clear that the rehabilitation of Ferencvaros worked out well.

hvg.hu: What was the secret that allowed Ferenc Gegesy, the mayor, and his colleagues, to be so successful?

I.Z.: Ferenc Gegesy involved the population in the plans as they were drawn up, launching building projects that worked out well for everyone. Problems cropped up in places where rehabilitation programmes were designed to suit the interests of individual politicians without taking into account residents' interests. The properties sold in Terezvaros were sold relatively cheaply because the buyers had to pay the bribe money. Look at the rehabilitation of Kiraly utca. Two weeks after the rendering was completed it had already fallen apart. They saved money on materials and did a bad job. But lots of people made money out of it. We called on Terezvaros council to resign when this corruption was revealed. But a majority of councillors rejected our proposal, and so everything will carry on as usual, at least until 2010.

János Pelle