Comparative analysis of systems of state funding for CSOsGoran Forbici www.cnvos.si

1. Comparative analysis of
systems of state funding for
CSOs
Goran Forbici

2. 6 countries
• Croatia
• Estonia
• Hungary
• Scotland
• Serbia
• Slovenia

3. 6 segments
• Quantitative overview
• Types of resources
• Distribution channels
• Legal framework
• Specific instruments for higher sustainability and
efficiency of public funding

4. Quantitative overview (2014)
• Croatia: 52.000 NGOs, 223m € = 34% of overall budget,
national level: 40 %
• Estonia: 31.000 NGOs, 147m €
• Hungary: 64.000 NGOs, 554m € = 31%
• Scotland (2013): 45.000 NGOs, 18.000 registered,
2,16bln € = 34%, national level: 50%)
• Serbia (2013): 23.000 NGOs, national level: 50m € = 20
% of overall budget
• Slovenia: 25.000 NGOs, 291m € = 38%, national level:
65%

5. Types of resources
• State budget – usually by far the largest resource on
national level (Slovenia 85%, Serbia 85%, Croatia 45%)
• Lottery & gambling funds (Serbia: 40% of income to
charities, UK: 28% of income = 70 % of all profit,
Estonia: entire gambling tax (10-18 %))
• Other taxes and excise duties (e.g. Estonia: 3,5% of
Alcohol excise duty to the Cultural Endowment)
• Percentage system: Slovenia: 0,5%, Hungary: 1%,

6. Distribution channels
- essentially decentralized system in all countries
(ministries & other independent budget users: agencies,
public funds etc.)
- Scotland & Estonia: increasingly delegating the
distribution of funds from ministries to specialized
“implementing agencies” (Scotland: 12 Non-
Departemental bodies (Creative Scotland,
Sportsscotland etc.) + 2 national lottery funds (The Big
Lottery fund, Heritage Lottery fund)

7. Big Lottery Fund
- lottery arm
- non-lottery arm (Big fund)
Example: In 2013 Big fund run a 20m ₤ programme on
behalf of Scottish government to support voluntary
organisations to deliver national strategic objectives
related to young people and children

8. Legal framework
No uniform rule:
• Slovenia: Public Finance Act + Rules on the procedures
of implementing the budget of the Republic of Slovenia,
but also some sectoral legislation and regulations (e.g. in
culture, sports, youth)
• Hungary: Non-profit Act & Law on Transparecy of Public
Funding (general framework, however no universal set of
rules with detailed procedural provisions)
• Estonia: scattered around different regulation for specific
areas. From 2012 (non-binding) governmental
Guidelines for funding CSOs from public budget.

9. Legal framework
• Scotland: no single regulation or policy due to highly
decentralized system
• Serbia: governmental Regulation on the means for
fostering programs in the public interest implemented by
associations + Guide for transparent financing of CSOs
from the local self-government budget
• Croatia: Regulation on criteria, standards and
procedures of financing and contracting of projects of
general interest implemented by associations (2015,
replacing the previous Code of good practice …) +
Manual for Implementation of the Regulation on the
Criteria, Standards and Procedures for Financing and
Contracting Programmes and Projects of Public Benefit
Interest Implemented by Associations

10. Legal framework
• However: although no single rule, as examples of
Slovenia, Estonia and Croatia show the trends go
towards standardisation and unification

11. Regulation of strategic approach to
public funding
= how the wider policy context and existing policy
strategies are used in the processes of public funding
Mandatory & recommended:
- Croatia (Regulation: “priorities for public financing must
be defined based on strategies, national programmes
and other strategic documents at the national or local
level.
- Estonia (Guidelines: “funding from the state budget has
to be in accordance with the public interest, which is
defined in national strategies”)

12. Specific instruments for higher
sustainability and efficiency of public
funding & CSOs
• Operational grants
• Prepayments
• Multiannual grants
• In-kind financing with voluntary work
• Co-financing of EU-funded projects

13. Operational grants
Known in mayority of anallysed countries:
• Hungary: via National Civil Fund (60% of all resources
which total 16m EUR)
• Estonia: via National Foundation for Civil Society (2008)
– 2,48m EUR
• Croatia: via National Fundation for Civil Society
Development (2016-18: 1,7m EUR; 75 organisations)
Slovenia & Scotland: more of an exception. Scotland: The
Thrd Sector Early intervention Fund. Slovenia: FIHO

14. Prepayments
Rather usual practice except in Hungary.
Slovenia: up to 30% (150 days to spend, then next
instalment)
Estonia: operational grants usually 100 % prepayments,
project funding up to 90%
Croatia: 5 models of payments, 4 include prepayments

15. Multiannual grants
• Slovenia: Majority of ministries for funding of established
programmes or larger projects
• Estonia: Ministry of Foreign Affairs, Ministry of Interior
• Scotland: commonplace, Big Lottery Fund grants up to 5
years, the Heritage Lottery up to 10 years
• Serbia: 7% of projects are multiannual.
• Croatia: regulated by the Regulation, 3 % of grants in
practice in 2014

16. Co-financing of EU-funded projects
Croatia: Office for Cooperation: calls for co-financing of
projects of CSOs
co-funded 450 EU funded since 2011
Slovenia: (only) Ministry for Culture, Agency for Youth and
Ministry for Foregn Affairs

17. In-kind co-financing with voluntary work
Slovenia: defined by law for all registered voluntary
organisations, possible for all CSOs
Recognised value of voluntary work is defined by a special
Regulation:
• 13 EUR for organisational work
• 10 EUR for substantive (expert) work
• 6 EUR for other volunteer work