Abstract
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The functioning of the self-government system is not independent of the quality of the public policy and public finances system over the past twenty-five years. The severe problems with the Hungarian self-government system do not constitute a failure of the decentralisation but are the “results” of the public policy over the past twenty years or rather they originate from the lack of a coherent public policy. Modernization of the public sector in Hungary – which, because of the aforementioned, is significantly delayed in comparison to western countries as it could only start after the change of regime – has been characterized by the different forms of privatization and decentralization (devolution) up until now. Privatization, however, is not as extensive as in the UK (e.g. it is not compulsory for local governments). As for decentralization, there is an ongoing debate whether the efficient delivery of extensively outsourced competences is not hampered by the loosely organized municipal system or the lack of control mechanisms.
Overall, budgetary restrictions were successfully implemented in the sub-system of local-governments. However, structural reforms linked to these restrictions regularly fell short due to political resistance. This process is clearly indicated by that the financing system of local governments tries to apply the techniques of welfare systems.
First and last, considered politically the changes in Hungary, the transformation of the self-government system is a success. Claiming the effective anomalies, the role of the state has been strengthen, the further centralization of the state has been implemented, and the possible balances against the central power has been further weakened. The self-government system has been weakened and emptied without any significant resistance, apart from the lobbying of politicians acting under the double mandate of Member of Parliament and mayors, and supporting the government. The secret of this consisted in a brilliant solution: the above mentioned changes have not affected the structures, which is particularly sensitive point not only for the public opinion but also for a huge part of the politicians. Meanwhile, the biggest part of the functions has been transferred from the self-governments to the state. The different symbolical elements (elections, bodies, offices) remain in use as well as the principle of “one settlement, one self-government”, which is obviously untenable for autonomous self-governments with wide power. Whereas, these structures had been mainly deprived of their competencies. In case of the remaining functions, the administrative supervision of the state has increased, while the role of the self-management has decreased. The central government, by providing sufficient resources exclusively for the mandatory duties (or maybe neither for them), would reduce the self-governments to a merely executive role.
Key Words: local government reform, centralisation vs. decentralization, local finance.
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