EU's unprecedented £417m punishment for Hungary The sanction will hit Hungary hard in the midst of an economic slowdown and would lead to the cancellation of much needed roads, energy and environment infrastructure projects in the country's poorest areas, some of Europe's most deprived regions. Olli Rehn, the EU's economic and monetary affairs commissioner, said he was making an example of Hungary for its constant breaching of the budget deficit rules, and gave it until the end of the year to implement new austerity measures. This decision is to be regarded as an incentive to correct a deviation, not as a punishment. It is a fair and proportionate measure of a preventive nature," he said. Restoring confidence in the Hungarian economy and supporting the prosperity of Hungarian citizens is the goal of our decision today. The EU's "excessive deficit" rules require member states to keep their budget overspends below three per cent of national GDP and overall debt at 60 per cent of national wealth. Hungary has drawn attention to the fact that it's budget deficit was below three per cent of GDP in 2011 and is forecast to remain below that target level in 2012. Moreover Hungary's economy grew at 1.7 per cent growth rate in 2011, 0.1 of a percentage point higher than the EU as a whole. "The facts prove that the government's economic policy is taking Hungary in a good direction," the Hungarian government said in a statement.