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EACEA National Policies Platform:Eurydice
Funding in education


3.Funding in education

Last update: 27 November 2023

Public Education and Vocational Education and Training

Almost all municipalities formed in the period following the change of regime maintained a basic school and a kindergarten. Maintaining schools has placed a significant, often unsolvable burden on small municipalities; nearly half of their annual budget expenditure was spent on the operation of public education institutions.

Depending on the financial capability of municipalities, there are huge differences in quality between schools, both professionally and infrastructurally. According to the division of tasks between municipalities, the local governments of Budapest and the counties were responsible for upper secondary schools, dormitories and the pedagogical assistance services, but basic schools and kindergartens were maintained by local municipalities.

Public funds play a major role in financing kindergarten care and basic education and upper secondary education (ISCED 1-2 and ISCED 3). Budget resources were formally allocated to the public education institutions through their maintainers; and until 1st January 2013, maintainers were typically local municipalities.

From 1st January 2013, the state has been maintaining public education institutions (except for kindergartens), until 31 december 2016 through the state institution maintenance centre (Klebelsberg Institution Maintenance Centre, hereinafter: KLIK). Separation of maintenance and operating tasks was a significant change. In the case of settlements with a population of less than 3,000, the state also performed the function of operating public educational institutions, whereas local municipalities with a population of over 3,000 were, as a rule, the operators of the municipally-owned public educational institutions maintained by KLIK.

By taking over the task of maintaining public education institutions by the state, the aim was to reduce the differences in quality between schools and to compensate for the quality inequalities resulting from the different income-generating capacities of municipalities.

The centralised operation of the sole state maintainer and the separation of maintenance and operating tasks caused difficulties in the day-to-day operation of public education institutions; therefore, adjustments were needed. In order to decentralise the system, as of 1st January 2017, KLIK was replaced by school district centres operating as independent budgetary bodies (initially 58, now a total of 60). In parallel with the reorganisation of the maintainer model, the maintenance and operation of the institutions has again fallen to the school district centres. Consequently, the dual financing that caused tensions (operation financed from the municipal, maintenance from the state budget) was eliminated. School district centres can make their own decisions financed by their own budgets, which promotes a more efficient decision-making mechanism adjusted to local conditions. Furthermore, it results in the decentralisation of the maintainer system that ensures the performance of public educational tasks.

The Klebelsberg Centre (hereinafter: KK), the legal successor of KLIK, unlike the former KLIK, does not perform any maintenance or operating tasks. Respecting the autonomy of the school district centres, it promotes the uniform application of sectoral aspects, ensures the professional and strategic coordination of the maintainer tasks of the school district centres, and controls their efficiency and financial management.

It remains the mandatory task of municipalities to maintain kindergartens and to provide meals in state schools.

Since September 2015, participation in kindergarten education has been compulsory in Hungary from the age of 3. On the one hand, this serves to ensure that 3-year-old children are educated in daycare institutions as soon as possible, and on the other hand, it supports families' quality of life and parents' return to work.

In 2015, the management of state-run schools providing vocational education and training was taken over from state institution maintainer by the National Office of Vocational Education and Training and Adult Learning (Hungarian abbreviation: NSZFH), a background institution controlled by the Ministry of National Economy (from 2018 the  Ministry of Innovation and Technology, and from 2022, the Ministry of Culture and Innovation ). It currently carries out its tasks through 41 vocational training centres, to which 371 member institutions belong. Innovative Training Support Centre Ltd. (IKK Ltd.) was established in 2019 with the aim to participate in the renewal of vocational education and training as a methodological centre, to perform the tasks delegated by the Minister responsible for VET as well as to carry out activities as a public administration body for vocational training in accordance with the new Act on Vocational Education and Training (Act LXXX of 2019). Its activities are funded largely by the National Employment Fund (from 2021, Economy Protection Fund).

Since September 2020, the vocational training system has operated separately from the public education system, and their funding also differs from that of public education institutions. As a rule, the basic task of vocational training can be performed by a vocational training institution (so-called technicums and vocational schools), and the basic task of public education is performed by a public education institution. In some cases andin the form specified by law, a multi-purpose public education institution may also perform basic vocational training tasks, and a multi-purpose vocational training institution may also perform basic public education tasks.

The main institutional change was that most of the former vocational upper secondary schools were transformed into five-year technicums, and vocational upper secondary schools specialising occupations became vocational schools, with a three-year training period. With these three-year programmes, a vocational qualification can be obtained, while at the technicums, in addition to technician or certified technician qualification, an upper secondary school leaving exam can also be obtained.

Instead of the 759 qualifications included in the previous National Qualifications Register (HuQR), the new system, the Register of Vocational Occupations now contains only 175 basic vocational occupations. The vocational training institution operating as part of the VET centre is an organisational unit of the vocational training centre with legal personality with an independent budget.

In vocational upper secondary schools under the National Public Education Act, students study in the fileds of arts, culture and pedagogy in addition to general knowledge subjects, following a programme requirements-based framework curriculum. The vocational school also continues to operate as a public education institution. The vocational school provides general education adapted to the nature of the special educational needs and vocational education and training for vocational qualifications in accordance with the Act on VET. Vocational education in the vocational school may be provided in accordance with the training and outcome requirements or a special framework curriculum based on the training and outcome requirements for the vocations defined in the Register of Vocational Occupations, depending on the type of special educational needs, and vocational training may be provided in accordance with a special framework curriculum based on the programme requirements.

Hungarian higher education The ’Shifting of Gears in Higher Education’ strategy document, discussed by the government on 22 December 2014, set the sectoral goal of creating a higher quality, performance-based higher education system while making efficient use of resources. It aims to create and operate a higher education system that is highly positioned in the international education and research area, responsive to societal challenges, and fundamentally determines the economic success of the country, with the key words: competition, quality, performance and success.

Hiher education institutions can be run by various maintainers. These institutios can be colleges or universities. They may operate under different models of funding.

A new model of trust funds has been introduced, based on Hungarian knowledge, innovation and talent, which is more open to the needs of the economy and public services, and which performs a public function in closer and more efficient cooperation with companies. 21 formerly public universities have been placed under this model. As of September 2021, more than 180,000 students (nearly 70 percent of all students) started their studies in a new model. Besides, a significant proportion of institutions are run by the church (covering 30,000 students), while six institutions remain state-run. In addition, there are also private higher education institutions.

Public expenditure on education

Looking at the period 2010-2020, it can be seen that total public expenditure on education as a % of GDP showed a declining trend0until 2013: from 4.6% to 3.9%. After 2013, expenditures as a share of GDP gradually increased (to 4.4% by 2016), then stabilised at 4,2-4.3% in 2017-2018. Despite the increase in total expenditure, total public expenditure on education as a % of GDP decreased to 3.9% in 2019, but increased to 5% in 2020.


Source: for the years 2010-2019: Hungarian Central Statistical Office; for the year 2020:   the explanation of Act CXVI of 2021 on the implementation of Act LXXI of 2019 on the annual central budget of Hungary


The nominal value of expenditures increased significantly (by 127%) for the whole period 2005-2020.


Source: for the years 2010-2019: Hungarian Central Statistical Office; for the year 2020:   the explanation of Act CXVI of 2021 on the implementation of Act LXXI of 2019 on the annual central budget of Hungary 

The increase in expenditures for kindergartens is outstanding (almost 79%), but that of basic schools and upper secondary schools as well as higher education institutions is more modest. After an initial surge, the budget for basic and upper secondary schools (ISCED 1-3) declined year on year between 2010 and 2013, and then increased significantly, thus, there was an increase of 34% over the whole period 2005-2019. In higher education (ISCED 6), there was also an increase after the initial fluctuations, resulting in a 67% increase over the entire period.


Source: Central Statistical Office