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Notes
- 1.
Being a part of a comparative effort, this paper uses the common terminology of the edited volume. However, it is important to note that foundations, voluntary associations and nonprofit service providers are not called third sector organizations in Hungary. They are usually referred to as civil society organizations (CSOs), nonprofit organizations (NPOs), voluntary organizations, and sometimes even non-governmental organizations (NGOs). These terms are used as synonyms, they share a similar general meaning though their connotations are somewhat different. When voluntary associations and private foundations are mentioned as civil society organizations or voluntary organizations, the emphasis is on the role they play in social participation, advocacy, self-help, and interest articulation. When they are called nonprofit organizations, we usually refer to their economic roles: the service provision and income redistribution. The term non-governmental organizations mainly appears in documents prepared for international bodies (United Nations, World Bank, etc.).
- 2.
Hungary is a small country with about ten million inhabitants.
- 3.
For a detailed description of the multiple streams framework see also the introductory chapter of this volume.
- 4.
It is worth noting that, in most cases, their objective was not to influence the policy towards the third sector, as a whole. They usually wanted to achieve some specific aims in their professional field (e.g., charity, culture, environment, human rights, etc.) and did not pay much attention to the wider impacts of their actions.
- 5.
It could not be dissolved because it was not an officially registered, formally existing organization. Most of its members still exist, some of them even developed, just they do not try to institutionalize sectoral co-operation any longer.
- 6.
In 2003 there were 726 registered nonprofit umbrella organizations (federations of the NPOs involved in the same type of activity, dealing with the same problem or working in the same geographical region) in Hungary, thus one out of every 73 NPOs was some regional or national federation of other nonprofit organizations (KSH 2005).
- 7.
In fact, despite the surprisingly high share of umbrella organizations in the Hungarian nonprofit sector, the number of NPOs which belong to any federation is lamentably low. More than three quarters of the NPOs remain outside any nonprofit network (KSH 2005).
- 8.
This is not a privilege, any nonprofit organization can be registered.
- 9.
This was the very first nonprofit management training project in Hungary attended by most of the prominent nonprofit leaders of the early 1990s. The training was designed and financed by the Johns Hopkins University Institute for Policy Studies and organized by the voluntary association for Hungarian nonprofit research.
- 10.
For information on the National Civil Fund and its boards see the chapter on policy windows.
- 11.
It is quite indicative that the two ministries simultaneously prepared two very different regulation measures. While the Ministry of Justice was working on the inclusion of the legal forms of the public law foundation and public law association in the Civil Code, the Ministry of Finances prepared a tax law which listed the preferred nonprofit activities and gave the Tax Authority the right to decide on the tax deductibility status of foundations.
- 12.
They argued that the 1% system would challenge the autonomy of churches and endanger their freedom from state scrutiny. They also mentioned the danger of an official registration of their members and supporters. What they did not mention was the result of an opinion poll, which had shown that only 4% of the taxpayers would have designated the churches as beneficiaries of the 1% of their personal income tax (Bossányi 1997, p. 102).
- 13.
Nevertheless, this was not the end of the story. In the following year the government managed to reach a compromise with the churches. The 1% law was amended by the Law CXXIX/1997, which provided that, upon the taxpayers’ decision, another 1% of the personal income tax could be transferred to the churches. The two declarations are strictly separated thus churches do not need to compete with lay voluntary organizations in order to win the taxpayers’ favour.
- 14.
If the taxpayer does not name a recipient organization or makes some formal mistake when preparing the designation declaration, his/her whole tax remains part of the central budget. The 1% transfer is not made either if the designated organization is not eligible, it cannot get the necessary certificates within the deadline, it thinks that the costs of meeting all the application and reporting requirements would be higher than the amount it could receive.
- 15.
However, the law guarantees that this amount cannot be less than 0.5% of the personal income tax even if taxpayers’ 1% designations proved to be extremely low.
- 16.
The NCF has two types of decision-making bodies: the Council and the Boards. The Council is a strategic decision-making body. Its major roles are to set priorities, to develop the grant-making policy, to decide on the Board structure and the division of sources among the Boards. The Boards are the operative grant-makers, they decide on accepting or rejecting the applications for NCF grants. The members of the decision making bodies are selected through a sophisticated open electoral system.
- 17.
Nonprofit organizations were prohibited from providing any (cash or in-kind) allowance to their volunteers. They could not even cover the costs (e.g., travel, meals, accommodation, insurance, etc.) related to voluntary work. If they insisted to do so, these costs were regarded as taxable income of the volunteers.
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Kuti, E. (2010). Policy Initiatives Towards the Third Sector Under the Conditions of Ambiguity: The Case of Hungary. In: Gidron, B., Bar, M. (eds) Policy Initiatives Towards the Third Sector in International Perspective. Nonprofit and Civil Society Studies. Springer, New York, NY. https://doi.org/10.1007/978-1-4419-1259-6_7
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