Deputy State Secretary for Minority- and Non-Governmental Relations Reform initiatives of the Hungarian Government concerning civil society organizations (CSOs) Csaba LATORCAI Deputy State Secretary for Minority- and Non-Governmental Relations IMPROVING GOVERNMENT – CSO COOPERATION FOR EFFECTIVE LOCAL DEVELOPMENT June 23, 2011 Budapest, Hungary

Issues related to the civil sector in Hungary: Administrative Different legal categories Duplicate data records Registration of CSOs, removal from registers, extract Legal supervision Too many extra regulations Non-coherent registers Management, grants Decreasing tax allowances Publicity of (accounting) reports Complicated grant-systems Timing delays Inadequate procedures Lack of harmonizing subsidization policies Result: Ineffective functioning on both state and civil society’s side High costs, parallel financing Non-transparent legal conditions and organizational operation Lack of accurate and reliable data on sector performance

Goals Administrative Result: Management, grants To simplify judicial proceedings To remove inactive organizations from registers To establish an effective information system based on the cooperation of offices To clarify concepts Management, grants To simplify the (accounting) report system and strengtheni transparency To simplify grant systems To train and employ skilled and experienced staff To harmonize and revize so called Professional Support Systems Result: Transparent legal environment and registers Effective operation Stronger civil society Defined, targeted and effective financial support policy

Priority tasks in 2011 – New Civil Law Main directions of planned changes: Clarification of CSO categories (association, foundation, civil corporation) A new type of organization: civil corporation- an organization without legal entity Definition of public benefit status „Tabula rasa” – Re-registration requirement Creation of a modern, transparent, electronic and certified public records registration system

Priority tasks in 2011 – New Civil Law Acceleration and simplification of the registration process (simplified registration procedure, the possibility of an electronic registration process) Integration of the legislation concerning the management of CSOs into one statutory instrument, reduction of administrative burdens

Priority tasks in 2011 - Civil financial support system National Cooperation Fund (NEA) – as a Separate State Fund within the Hungarian budget (2012) – a transparent, less administrative civil support system. A panel of experts is to make proposals concerning support of applications.

Funding Principles 2012 Central budget funds – except the National Cooperation Fund -open for public benefit organizations only CSOs subsidized through the Budget Act are not eligible for National Cooperation Fund support  

Funding Principles 2012 Publicity = Funding opportunities available for CSOs (with terms and conditions) to be made public through the media   Support received from the government cannot be used as a secured loan or loan repayment Publicity = allocations provided by public benefit organizations to be made public

01.01.2012 – New Civil Law Expected effects: - Supportive operational environment, further strengthening and development of the sector - Standardized operation of law, decreasing administrative burden - More transparent operation, more applicable legal environment - More realistic view of the civil sector, screening of "phantom" organizations  

THANK YOU FOR YOUR ATTENTION csaba.latorcai@kim.gov.hu Further information on the Hungarian civil sector: www.kormany.hu www.civil.info.hu www.onkentesseg2011.hu Please send opinions, suggestions to: civiljog@kim.gov.hu