1. 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

2. 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

3. 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

4. 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

5. 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

6. 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.

7. 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

8. 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

9. – 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

10. THANK YOU FOR YOUR ATTENTION
Further information on the Hungarian civil sector: Please send opinions, suggestions to: