UPDATE 3-Hungarian voters set to punish Socialists at polls

* Fidesz seen ousting Socialists; far right may come 2nd

* Hungarians want growth, jobs, fresh start for economy

* Voter turnout 46.78 pct at midday; polls close 1700 GMT (Adds latest turnout figure)

By Krisztina Than and Marton Dunai

BUDAPEST, April 11 (Reuters) - Hungary voted on Sunday in an election that is expected to usher in a centre-right Fidesz government promising growth and jobs after eight years of Socialist rule and the country's near financial collapse.

Fidesz, which last ruled between 1998 and 2002, has campaigned on cutting taxes, creating jobs and supporting local businesses to boost to Hungary's economy, which was pounded by a deep economic recession last year.

The last opinion polls showed Fidesz had a good chance of winning a two-thirds majority in the next parliament, meaning it could push through vital structural reforms, and the far-right Jobbik party would get into parliament for the first time.

The Socialist government led by technocrat Gordon Bajnai since April 2009 made painful budget cuts to rein in the deficit under a deal led by the International Monetary Fund, which provided emergency financing for Hungary amid a crisis in 2008.

The budget cuts have helped stabilise Hungary's finances and regain investors' confidence but exacerbated the recession, and opinion polls ahead of Sunday's vote showed that Hungarians were overwhelmingly looking for a change in government.

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Fidesz is led by seasoned politician Viktor Orban, 46, who was the prime minister heading the last Fidesz government and whom many supporters expect to restore Hungary's national pride.

"I voted for Fidesz, because to fix the country we need the clearest possible backing for the next government," Ilona Glazer, 72, said after casting her vote in Budapest.

"We need to fix the economy most of all, and health care as well, but there is a lot to make right in people's souls, too. With tasks this big, it's good to have a strong leadership."

But there were voters who believed Hungary still needed a left-wing party in parliament, even though the elections were expected to transform the political landscape.

"I voted for the Socialists, but I only made up my mind in the last minute. Their corruption and scandals kept me hesitating, but ultimately I thought they would lose big time now, so it's important to have some sort of Socialist group in Parliament," said Piroska Szabo, 47, a kindergarten teacher.

Voter turnout at midday was 46.78 percent, slightly lower than 48.89 percent recorded at the same time four years ago.

Pollster Tarki had said turnout at the elections could be between 59 and 64 percent. Gallup had predicted 66 percent.

"Fundamentally, this country needs a renewal in its soul and in its morals. This elections can help achieving that if the (new) leaders will represent that," said Peter Buki, 37.

REFORMS IN FOCUS

The country's economy contracted by 6.3 percent last year, while unemployment is running at 11.4 percent -- the highest since 1994 -- which has further increased public discontent over the past Socialist governments' spending cuts and tax increases.

Economists say Fidesz will need to implement deep reforms to reduce the local government sector and make the health care and education systems more efficient to put Hungary back on a track of sustainable and strong economic growth.

"Two-thirds (win by Fidesz) would be very good for the market as the perception is that not only the reform of (public) administration hinges on that, but also the reforms in a range of other fields, the reform of the state," Gabor Orban, an analyst at Aegon Securities said.

However, analysts also said significant gains by far-right Jobbik at the elections could create unease among investors.

Nationalist Jobbik, which has capitalized on public anger over economic hardship and a growing resentment toward a large Roma minority, may end up as the second-biggest parliamentary force, some political analysts have said.

Fidesz has ruled out any coalition with Jobbik.

There are some 8 million voters in the Central European country. The parliamentary election is held in two rounds, the first on Sunday and the second on April 25. [ID:nLDE6350MY]

Polls will close at 1700 GMT. The first preliminary results are expected after 2000 GMT. (Writing by Krisztina Than; Editing by Alison Williams)