EU exec to propose fund freeze for Hungary over deficit

(Repeating)

BRUSSELS Feb 21 (Reuters) - The European Commission is to propose on Wednesday to suspend cohesion funds for Hungary from next year over Hungary's failure to reduce its budget deficit in a sustainable way, a Commission document showed on Tuesday.

The document, detailing the points on the agenda of the weekly meeting of European commissioners, listed a proposal for a decision by European Union finance ministers to on the suspension of the cohesion funds, which less developed members of the 27-nation bloc receive to catch up more quickly.

"It... also noted that this decision was an incentive for Hungary to correct its excessive deficit (rather than a 'punishment') and that the suspension would be reversible if sufficient action was taken by Hungary," the document, obtained by Reuters, said.

The concrete amount of money that could be suspended would only be discussed on Wedneedsay, the document said.

The proposal from the Commission would not suggest what Hungary needed to do to get the suspension lifted. (Reporting By Jan Strupczewski and Francesco Guarascio, Editing by Justyna Pawlak)