B R E A K T H R O U G H

MoE and NGOs break bread in Hungary

by Nicolas Johnson

Hungary is breaking new ground in the field of environmental protection. For the first time in Central and Eastern Europe, Hungary's Ministry of Environment and Regional Policy is not only giving the green movement money for environmental protection activities, they are allowing the NGOs themselves to decide how to spend it.

Traditionally, the Ministry of Environment sets aside a portion of revenues generated from environmental charges on fuel, part of which is earmarked as the so-called "minister's frame," a pool of money doled out to NGOs by a cabinet bureau set up within the ministry. But this time, rather than distribute the wealth from the top down, the ministry decided to allow Ft 25 million (USD 200,000) to flow from the bottom up.

HUNGARY'S MINISTER OF ENVIRONMENT Ferenc Baja attempts to make peace with Hungarian NGOs...


To be fair, the decision was not just a result of altruistic goodwill on the part of the bureaucrats. The ministry's decision to modify how the minister's frame was distributed came largely as a result of NGO pressure. NGOs have not always been satisfied with the manner in which the funds are distributed, so they demanded an open and transparent granting mechanism that would depoliticize the issue.

"We have been demanding this since 1991 because we were unsatisfied with how the money was used," says Vilmos Kiszel, member of the Goncol Alliance, a highly respected NGO composed of social groups, volunteers and experts. The pressure worked, and the Ministry of Environment invited NGOs to take the matter into their own hands.

From collaboration to consternation

Despite the breakthrough, NGOs have been left with a bitter taste in their mouths. Last March, during the annual Hungarian national meeting of environmental NGOs, Minister of Environment and Regional Policy Ferenc Baja promised to hand over Ft 100-110 million (approximately USD 840,000) for environmental groups to manage themselves. By August, this figure had been trimmed to a lean Ft 25 million, a considerable drop from the Ft 150 million awarded to NGOs annually for the past few years.

...BUT NGOS ARE STILL LOOKING FOR A BETTER DEAL, according to Vilmos Kiszel of the Goncol Alliance.


"Nobody knows what happened to the money," says Kiszel. "The Ministry of Environment recognized us as a partner, then left us with only Ft 25 million. Is this how a partnership is supposed to work?" Gabor Lanyi, responsible for NGO relations at the ministry, has provided NGOs with at least a partial answer. Parliament reduced the minister's frame from 25 to 15 percent of total fuel tax revenues, a decision that came only after the minister had made his promise to the NGO community. And, Lanyi adds, the previous government had financial commitments of which Baja was unaware when he made his promise. This forced the ministry to restructure its balance sheet in order to pay its bills.

"We really want to support these organizations because we consider their work important," says Lanyi. "We tried to do something good but we didn't get any thanks."

The resentment over the disappearing funds almost foiled the whole deal. Some NGO representatives suggested the money be refused until the ministry came up with clear disbursement guidelines and a convincing picture of why only Ft 25 million was being awarded. Cooler heads eventually prevailed, and the representatives agreed to accept what the ministry had to offer before it disappeared altogether, though that didn't prevent tempers from continuing to flare.

"I want to emphasize that this is a unique case, that it not be taken as a precedent. There are problems with both the amount of money, that it's too small, and the distribution mechanism, which is unclear and has legal and mechanical problems," says Janos Vargha, director of Danube Circle, a Hungarian NGO.

Among the remaining problems is the absence of a legislative framework that details how much money should be given to environmental NGOs. "Next year someone in the ministry could simply decide to go back to the old system," says Gabor Trombitas of Hungary's Eco-Service. Even the ministry is aware of the hurdles that remain. Lanyi points out that even if the ministry increased its financial support for NGOs, Parliament could reduce its support, making the total amount the same.

Despite the bickering, NGOs will receive the Ft 100 million Baja promised them last year. In addition to the Ft 25 million the ministry will award directly to NGOs, the ministry has already disbursed close to Ft 75 million in grants for publications, training and camps.

NGOs set to carve up the pie

Despite the twisted plot, the story does have a relatively happy ending. Over the summer, the ministry called for suggestions from NGOs on how the money should be distributed. The ministry accepted the Goncol Alliance's proposal, which recommended that NGOs hold a meeting to decide for themselves how the money should be spent, and transferred the funds to the Goncol Alliance in trust for the Hungarian green movement. Because of Kiszel's previous involvement in hammering out a granting mechanism and his familiarity with the issues involved, he agreed to make Goncol the administrator of the fund, though his organization refused responsibility for distributing the money. That, Kiszel said, should be decided by the NGOs themselves at a national meeting dedicated to this issue.

The meeting, held in Budapest on 9 September, saw representatives from 142 Hungarian NGOs meet to determine how to carve up the pie. "This was a chance for us to show that we could do this democratically and without screwing each other," says Kiszel. The NGOs agreed on an open and competitive application process, and elected a five-member board of trustees to evaluate grants, distribute funds and resolve any contentious issues that might evolve along the way.

Because of the 30 November deadline stipulated by the ministry, NGO representatives decided on a 16 October deadline for NGOs to submit applications and proposals to the board. By the time the deadline rolled around, the committee had received 317 applications requesting approximately Ft 130 million.

The issue remains partially unresolved, at least for now. Who gets how much won't be determined until late November. And neither the Ministry of Environment nor Hungarian environmental NGOs are completely satisfied with the ad hoc agreement that now exists between them. Most will agree, however, that the improvements made to date are a step in the right direction. "The system we have isn't perfect," says Trombitas, "but it's still a lot better than it was."

THE BULLETIN * AUTUMN 1995