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On the EU Funds Dedicated to Reduce Poverty and Inequality in Hungary András Csite, Nóra Teller

On the EU Funds Dedicated to Reduce Poverty and Inequality in Hungary András Csite, Nóra Teller September 26, 2013. HÉTFA Research Institute and Center for Social and Economic Analysis For Applicable Knowledge Október 6. utca 19., H-1051 Budapest www.hetfa.hu. Main Statements.

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On the EU Funds Dedicated to Reduce Poverty and Inequality in Hungary András Csite, Nóra Teller

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  1. On the EU Funds Dedicated to Reduce Poverty and Inequality in Hungary András Csite, Nóra Teller September 26, 2013 HÉTFA Research Institute and Center for Social and Economic Analysis For Applicable Knowledge Október 6. utca 19., H-1051 Budapest www.hetfa.hu

  2. Main Statements • Instruments of development policy in reducing poverty are rather limited • There were unreasonably high expectations about development policy in 2007 – social inclusion was no exception • External factors (economic crisis, austerity in public finance, strengthened negative incentives) affected the results unfavorably • There are results, but there are even more lessons for 2014-2020 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  3. Structure of Presentation • The scale of the problem: social-economic and policy environment • Inputs and targeting • Results • Lessons Situation of the elite grups of lagging regions have been stabilized (with the help of EAFRD projects as well): they now have perspective for growth at home – meanwhile, these elite groups (mayor, entrepreneurs, managers of public institutions, teachers, etc.) have hardly become more suited for being actorsof social integration 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  4. The Number of People Living in Poverty is Increasing Poverty Rate around 2010 – EU and Hungary Forrás: Tárki, Intequality and Polarization in the Hungarian Society. Tárki Monitor Report 2012. Between 2003-2008,decrease due to social transfers, after 2008, as a consequence of the economic crisis, the austerity in public finances and the encumberment of accessiblity to social transfers: significant increase 4th EvaluationConference HETFA Research Institute and Center for Social and EconomicAnalysis 26 September 2013

  5. Rise from Poverty Gets More Difficult Increase in risk of poverty: children and young people, unemployed/inactive, people with low level of education, Roma households Rise from poverty is almost impossible + poverty is inherited to next generation 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  6. 2007-2013 – New Era in Social Inclusion Policy Underlying idea in the 2007 planning process: previous social inclusion policy proved ineffective, a restart is needed: Ever more funds for development (no funds for operation) Innovative, new instruments Robust territorial targeting– Least Developed Micro-Regions (LDM) Development policy aims for results in all aspects of poverty and social exlcusion Development policy operates (partly) independently from the goals and instruments of traditional social inclusion policy institutions 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  7. Instruments Critique: project-centered developments, high administrative costs Negative incentives from 2008 public employment, unempl. benefits, schooling 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  8. Territorial Targeting Worked on Micro-region Level Funds were allocated to the micro-regions where it was needed the most Change in the accessiblity of basic healthcare services Source: Budapest Institute –Evaluation of Healthcare Programs 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  9. LDMs: Developments Financed by EU 33 LDMs’ average Source: Hajnalka Lőcsei – Evaluation of LDM Program 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  10. Results of Developments in Public Education • Less unjustified absencesin the schools involved in thedevelopment • Educational developments of cultural institutions reach disatvantaged students • Sustainability of results is problematic: once development funds run out, free services are no longer availalable 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  11. Role of Nonprofit Organizations • Development policy strengthens nonprofit organizationsin the field of social inclusion • 40 %of beneficaries are founded after 2006 • Professionalization, national network • Local cooperations– local labor office, local government Actions and funds rarely reach micro-regional periferies – skimming within target group and target territory 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  12. The Developed Services Have Improved What happened to people in socal inclusion programs? Experiences of life story interviews Afterunemploymentfound a job Whileseekingfor a job, is abletowork illegally and maintainher/himself Uses more informationinjob-seeking thanbefore 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  13. It Won’t Work Only from EU Funds... EU development funds are not sufficient in themselves to make a real difference Hungariansliving inpoverty SROP Priority 5 beneficiaries 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  14. Involvement of EARFD • Poverty is partly concentrated in agricultural regions • 2007-2013: no meaningful coordination between ERDF/ESF and EAFRD developments • Weak involvement of EAFRD projectsin tackling poverty • Automatization and development of large scale monocultures decreased demand for labor 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  15. New Institutional Setting from 2014 • Integration of MAsinto organizational structure of ministries • Pro: development interventions are better integrated with other policy instruments • Con: less opportunity for experimentation for development policy • The real issues to be addressed: • Better, goal-oriented incentives for people in public-nonprofit systems of anti-poverty and social inclusion policy (local government leaders, health visitors, social workers, teachers, etc) • Strengtheningvocation, easing on the domination of project structure, decentralization of implementation 4th EvaluationConference HETFA Research Institute and Center for Social and Economic Analysis 26 September 2013

  16. Thank you! András Csite – Nóra Teller HÉTFA Research Institute – Metropolitan Research Institute 1051 Budapest Október 6. u. 19. www.hetfa.hu

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