From the 2026 budget audit
Why is the state still running horse stud farms in 2026?
4.7 billion Ft a year funds state-owned agricultural enterprises — stud farms and estates — doing what private operators already do at their own cost.
Roughly 1,180 Ft per income taxpayer per year — 4,724 million Ft total — to operate state-run horse studs and agricultural estates.
What you see — and what you don't
The seen: Hungary's historic state stud farms, staffed and maintained under public ownership. The unseen: the wage-earner whose income tax funds a trading business that generates no return the state needs to own — a business a private buyer would run, and pay tax on, instead.
Objection
"But the historic stud farms are part of Hungary's national heritage — without state ownership they will be neglected or broken up."
Answer
Heritage is preserved by breed associations, private equestrian operators, and the visitor economy — not by who signs the payroll. Under privatisation the stud farms continue to operate; only the employer changes. The state cannot read from its internal accounts whether the enterprise creates or destroys value; a private owner can — and bears the consequence.
Share if you think horse stud farms should be run by the market, not funded by your tax.
The analyst's verdict
State stud farms
Rationale
The ménesgazdaságok are state-owned and state-operated agricultural enterprises — horse studs and associated estates. Breeding horses, cultivating land, producing crops are ordinary commercial activities carried out by thousands of private operators in Hungary without state subsidy. There is no rights-protection function here, no irreversible-harm response, no constitutional precondition. What the line funds is the state's continued operation of a trading business. A state that runs a stud farm faces the recurring difficulty that it cannot read, from its own internal accounts, whether the enterprise creates or destroys value: it operates inside a budget envelope rather than against a market price for its own equity, and a loss is met by next year's appropriation rather than by the discipline a private owner faces. The genealogical and cultural heritage of historic Hungarian stud farms is real, but heritage is preserved by private owners, breed associations, and visitor revenue — it does not require the line item. The honest classification is divestment: transfer the studs to private ownership (breed associations, equestrian operators, the existing visitor-economy businesses around them) over a short horizon, with the small permanent staff protected through the transition.
Transition mechanism
Severance-with-overlap. The protected party is the permanent staff. Payroll plus employer contributions total 1,201.9 millió Ft. Under a 24-month severance-with-overlap arrangement, staff retain their state salary for two years and may take new employment — including with the privatised entity — during that period. The non-payroll components (operating costs 3,281.0, other operating 0.3, investment 241.2 = 3,522.5 millió Ft) end with the transfer of operations to private ownership and are not protected. Year 1 and Year 2 save the non-payroll envelope while severance runs; Year 3 onward saves the full envelope. New Zealand's State-Owned Enterprises Act 1986 is the procedural template — state trading entities reconstituted on a commercial basis with independent boards, many subsequently divested, with SOE-sector dividend revenue rising sharply post-reform.
Affected groups
Approximately the staff funded by the 1,201.9 millió Ft payroll line — a small workforce with transferable agricultural and equestrian skills, the most natural re-employment path being the privatised studs themselves. Breed associations and visitors retain access to the heritage activity under private ownership.
Sources
- Nemzeti Menesbirtok es Tangazdasag Zrt. · Wikipedia (citing state asset records) (2024)
Free Society Institute
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