Hungary PM's Fidesz party suffers surprise setback at local by-election

BUDAPEST, Feb 25 (Reuters) - Hungarian Prime Minister Viktor Orban’s ruling Fidesz party suffered an unexpected setback at a local government by-election on Sunday when an opposition-backed independent comfortably beat the Fidesz candidate for mayor weeks before a national election.

Orban’s rightwing nationalist Fidesz is seeking a third consecutive term in parliamentary elections, campaigning with a fierce anti-immigrant message, coupled with increased spending on wage rises and promising more money to pensioners.

But preliminary results showed Peter Marki-Zay, a political novice, beating Zoltan Hegedus with 57.5 percent of the vote against 41.6 percent at the election for mayor of the southern town of Hodmezovasarhely, a Fidesz party stronghold.

“We stood up and Hodmezovasarhely has shown that we want to get rid of the big boys bullying the whole class,” Marki-Zay told a news conference, drawing a big round of applause, with one of his children standing by his side.

“A new era has begun today,” he said, adding that public opinion polls showing a dominant Fidesz lead “could be thrown into the garbage bin.”

With six weeks left before a parliamentary election, the outcome is an embarrassment for Orban’s Fidesz party and Hodmezovasarhely native Janos Lazar, Orban’s chief of staff, who had personally campaigned in favour of Hegedus.

Orban’s Fidesz is still a strong favourite at the April 8 election, but a political analyst said Sunday’s result could change dynamics within the opposition, which had thus far struggled to mount any serious challenge.

Marki-Zay ran as an independent, but was backed by the Socialists, radical nationalist Jobbik, the main opposition party, as well as LMP, a small liberal party.

“This (result) has a sweeping psychological significance,” said political analyst Robert Laszlo at think tank Political Capital.

“It shows that Fidesz is beatable even in a place like this and the result could jolt opposition parties into action and rethinking their strategies.”

At 62.4 percent, turnout was higher than expected, surpassing even the 58.8 percent at the previous parliamentary election four years ago.

The leftist opposition has been in a disarray since the resignation of their candidate for prime minister, Laszlo Botka, in October.

Jobbik has been trying to lure voters by projecting a more moderate, centrist image.

Orban, who has clashed repeatedly with European Union authorities over reforms affecting the judiciary and the media, has presided over a downward slide on the global corruption league table, watchdog Transparency International said on Tuesday. (Reporting by Gergely Szakacs and Krisztina Than, Editing by William Maclean)