Social Services in Hungary

In Hungary, a range of social benefits were established by the end of the 1980s. However, services for children and families were quite uniform, not really taking into consideration the different kinds of needs. These services looked similar and provided more or less similar provision everywhere in the country. The results of the political and economic changes in 1989-1990 have brought about changes in the structure of employment, too: different work structures, unusual working hours, different demands on the part of employers, and different needs in terms of services helping families. There was a decline in the gross domestic product, consumer prices went up, subsidies were reduced, and the majority of the people was getting poorer. Unemployment appeared, and there was quite high inflation. The polarization of society developed rapidly.

Legal Framework/Regulation

Today, the Constitution of the Hungarian Republic guarantees several social rights, namely the right to social security and a certain standard of living. The entitlement to social benefits is provided by the state through its social security system and its welfare institutions.

The Social Act of 1993 (Law 3 of 1993 on social provisions and social administration) and the Act on the Protection of Children (Law 31 of 1997) describe the system of services and financial support. The aim of both is to maintain the quality of life and human dignity of those people who are in need of help for physical, mental or social reasons. The provisions give entitlement to all citizens who are in need of such services, and whose status of health requires them. Nursery care for children under the age of 3 is considered as a basic service for all working families, whereas kindergarten (also full time care, for children between 3 and 6 years of age) is part of the education system.

These Acts provide the legal background for the services regardless of the provider, require diversification according to needs, state the possibility for non-govemmental organizations and the private sector to draw up contracts with local authorities for service provision, and describe the qualifications necessary for the different professionals working within the social domain.

Types of services

The goal has been to offer a variety of services to choose from in order to better match the needs of users. There have been initiatives to set up new forms of services and attempts have been made to specialize and integrate their delivery. There is a move towards scaling services and to implement initiatives that are suitable for serving even the smallest villages. The aim is to ensure full coverage of the population of Hungary with a variety of services to choose from.

Existing services regulated by the Social Act include: home help, meal provision, family support service, day care for the homeless, clubs for the elderly, day care for the disabled, day care for drug addicts, home and respite care for the elderly, homes for psychiatric patients, home and respite care for disabled children, home and respite care for disabled adults, homes for addicts, homes, shelters and night shelters for the homeless, other homes. Services regulated by the Act on the Protection of Children include: childcare for children under the age of 3, child welfare services, respite services, and provisions for children in care (child protection system).

However, implementation of the legislation has not been fully achieved yet in all parts of the country and there have been no surveys to reveal the real needs of the population. Presently, the need can be estimated only from information on the utilization of services and the existence or size of waiting lists.

Responsibilities concerning administration, financing and organisation

Today, in Hungary, the responsibility for providing care is shared between families and friends (informal care) and other agents such as the national government, local government, church, and the voluntary sector (formal care).

Ever since the political changes in 1989-1990, one of the issues, which keep coming up is the role of the state in the provision of social services, in the support of those in need and in financing different kinds of services.

The democratically elected governments approached these questions slightly differently, however, the main thrust of the political and the consequent economical changes was the substantial change in the role of the state. Compared to the state socialist years, when all services were financed from the central budget, the government today has only a regulatory function. With the emergence of the local government system in 1990, the responsibility for the provision of services was placed with the county and local authorities, within the 3-tier system of government (national, county, and local).

According to the Social Act, „it is the duty of central government and local authorities - beyond the citizens‘ responsibility for themselves and their families, and local communities‘ responsibility for their members - to ensure the conditions for providing social services“ (§ 2). By reason of this division of responsibilities the central government establishes the legal framework, the regulations, and the system of financing for social provisions.

Local authorities are responsible to set up the local system of social services within the framework described in the law and to define the entitlement criteria for social allowances and social services. The Act provides an opportunity for local authorities to contract non-governmental service providers (§ 120). The law also determines the obligatory contents of the contract. The parties must come to an agreement concerning the form of provision, number of places, fees, and the system of reporting and supervision. Local authorities are obliged to pass on the available fixed and earmarked (so called "normative") funding from the central budget to the NGOs, when the service is offered within the scope of the contract. Nevertheless, the ratio of non-govemmental providers is quite moderate within the social domain.

The relatively low participation of the non-governmental sector in maintaining care services is not surprising. Non-profit service provision could not develop rapidly because of the lack of capital needed for investment. Overall, about 5-25 % of places (depending on the type) are provided by the non-governmental sector, which includes voluntary, church and private (for profit) sector providers. Maintaining a place in a centre or home (for children, the elderly, or for specific groups of vulnerable people) in most cases costs more than the normative support ensured by the national government. Service providers have to complement it to a different extent, depending on the type of the provision. The majority of the population in Hungary would not be able to cover the full cost of services anyway.

There is a lack of tradition in organising NGOs, and setting up initiatives in local communities. At the same time, the central and local governments have very high expectations as to the provision of effective solutions of social problems. There is also a lack of culture for offering sponsorship. Companies have no strategies and ideas for supporting NGOs. Therefore, many NGOs besiege central and local governments for financial assistance.

Financing

An overwhelming part of the institutions providing care are maintained by the county and local authorities, that's why they are mainly financed by tax revenues. One part of the operational costs the local authorities obtain from the central budget in the form of a fixed support, another part of the costs is financed from their own revenues, and as a third source a contribution paid by the beneficiaries completes the sum. These contributions are fixed sums which must not exceed a stated percentage of the recipient‘s monthly income. The ratio of the three sources can be different, depending on the type of the benefits and the financial situation of the given local authority. Private insurance schemes are not involved in the financing system. Overall, this system can be considered as a supply subsidizing one, as services are funded directly and those needing care don‘t get cash grants in order to finance the services.

In summing up the situation today, perhaps we can say that even though the dynamic processes of demand and supply influence the social welfare system to a greater extent than before, the market-controlled approach is not viable. Ours is a mixed system, comprised of financial and inkind support and service provision that is closer to state guaranteed provisions, on the continuum between directly state provided services and fully privatized services. 5-25 % of the places in the different services are maintained by the non-governmental sector.


Czibere, Karoly/Korintus, Márta, Social Services in Hungary, in: Newsletter Observatory for the Development of Social Services in Europe 1/2004, p.5f.