Nov. 3 (Bloomberg) -- Hungarian Prime Minister Ferenc Gyurcsany increased his support during the financial crisis, even as his proposed spending cuts may alienate voters in the long run, according to a report by Political Capital.

Gyurcsany, whose Socialist party has been governing in a parliamentary minority since May, has said he will resign if lawmakers reject his budget for next year. Yesterday he said he was ``almost certain'' he will serve out his term until 2010, Vasarnapi Hirek newspaper reported, citing an interview.

``The crisis has changed the political and economic environment and in this situation passing the 2009 budget'' and Gyurcsany serving out his term have ``high chances,'' the Budapest based institute said in an e-mailed report.

Hungary secured 20 billion euros ($25.5 billion) in emergency loans last week to shore up its economy after stocks, bonds and its currency plunged as investors withdrew money from emerging markets in a flight to safety during the financial crisis. Gyurcsany pledged to cut the budget deficit faster than earlier planned to reduce the country's vulnerability.

Some opposition parties, such as the Free Democrats' Alliance and the Hungarian Democratic Forum who earlier said they may reject the budget, are now ``more open to government plans'' because of the crisis, Political Capital said.

The Socialists narrowed the lead of the main opposition Fidesz party last month to 11 percent from 14 percent the previous month, according to a poll by Szonda Ipsos, the daily Nepszabadsag said today.

Socialists Climb

Support for the Socialists was at 20 percent in October, the highest since August 2007, according to the poll which was conducted by asking 1,500 Hungarians between Oct. 20 and 26. No margin of error was given.

Gyurcsany's gains may be short-lived as his measures to stabilize the economy, including the freezing of wages for public workers and reducing pensions to wean the country off external financing, may end up alienating voters.

``The government's plan has direct negative effect on 1.6 million people, one-fifth of the total 8 million voters,'' Political Capital said.

The support of pensioners, a bedrock of Socialist support until now, is ``extremely important'' to retain for the governing party, the report said.

To contact the reporter on this story: Zoltan Simon in Budapest at zsimon@bloomberg.net.

Last Updated: November 3, 2008 10:39 EST