Institutional Mechanisms of NGO State Funding Mladen Ivanovic, Association of Municipalities in Croatia Baku, 30 May CASE STUDY: CROATIA

Political system: Parliamentary Republic Population: Capital: Zagreb (population: ) Language: Croatian Religion: Catholics (87,83%), Muslims (1,28%), Orthodox (0,91%) 2 BASICS ABOUT CROATIA

NGOs INSTITUTIONAL FORMS Basic institutional forms for NGOs in Croatia are associations and foundations. –Associations (membership organizations) Number of registered associations: cca 30,000 –Foundations (non-membership organizations) Number of registered foundations: 120 Discrepancy in registered foundations due to a regressive legal framework for foundations relative to associations. Other institutional forms: private institutions and not-for -profit corporation (the later used very rarely). 3

THREE PHASES OF STATE POLICY TOWARDS NGOs FINANCING 1990 – 1998 NGOs were not systematically funded from the State budget 1998 – 2003 Centralized financing of NGOs 2003 – Present De-centralized financing of NGOs 4

SUPPORT TO NGOs IN THE PERIOD 1990 – 1998 Obsolete legal framework Work of NGOs was not systematically stimulated or supported by the State Prevailing criteria for funding was “NGOs of interest for the State” Non transparent mechanism of distribution of public funds Lack of precise data on public funds granted to NGOs Number of foreign donors in Croatia 5

STATE SUPPORT TO NGOs IN THE PERIOD 1998 – 2003 Establishment of the Office for Cooperation with NGOs (1998) - It’s goal is creation of conditions for partnership and cooperation with NGOs - The Office has wide spectrum of possible competencies Design of the Draft Programme of Cooperation between the Government and NGOs (2000) Establishment of the Civil Society Council (2002) 6

STATE SUPPORT TO NGOs IN THE PERIOD 1998 – 2003 Advantages of centralized delivery of funds: –definition of priorities –public biddings –independent comissions –the results were publicly announced –regular monitoring Shortcomings of centralized delivery of funds: –high administrative costs –lack of information about real needs in the field Through the Office NGO projects were supported with 14,5 mil € (22,5 mil. $) 7

IMPORTANT CHANGE IN 2002 Re-distribution of the resources from the National Lottery: Until 2002From 2002 forward humanitarian activities sports technical culture sports, fight against drugs and other addictions, social and humanitarian activity, disabled persons, technical culture, culture, non-institutional education, development of civil society 8

IMPORTANT CHANGES IN 2003 Establishment of the National Foundation for Development of Civil Society Established by the Government as public foundation Financed from the National Lottery and the State budget Supports civil society in different ways Defines funding priorities and creates different funding programmes accordingly Initiation of public debate about conflict of interest in decision- making process Delivery of funds was de-centralized to ministries and other Government’s institutions 9

NATIONAL STRATEGY FOR THE CREATION OF AN ENABLING ENVIRONMENT FOR CIVIL SOCIETY DEVELOPMENT (2006) Covers 5 years period The aim is creation of new legal, financial and institutional system of support to civil society Promotion of non-violent society and human’s right to be different Recognition of public benefit organizations Promotion of voluntary work and philantropy Opening of political processes toward public Development of the rules for access to public funds (Code of good practice) 10

CODE OF GOOD PRACTICE, STANDARDS AND BENCHMARKS FOR THE ALLOCATION OF FUNDING FOR PROGRAMMES AND PROJECTS OF NGOS ( 2007) Decision on priorities Public competition Applications are opened by comission Professional assessment of projects Written communication with all applicants Public announcement of the results Contract Monitoring and evaluation 11

GOVERNMENT OFFICE FOR COOPERATION WITH NGOs CIVIL SOCIETY COUNCIL NATIONAL FOUNDATION FOR DEVELOPMENT OF CIVIL SOCIETY MINISTRIES DRAFT PROGRAMME OF COOPERATION BETWEEN THE GOVERNMENT AND NGOs NATIONAL STRATEGY FOR DEVELOPMENT OF CIVIL SOCIETY CODE OF GOOD PRACTICE, STRANDARDS AND BENCHMARKS FOR THE ALLOCATION OF FUNDS OVERVIEW OF INSTITUTIONS AND DOCUMENTS WHICH ARE FRAMING NGO STATE FUNDING NGOs 12

FUNDS DELIVERED TO NGOs BY NATIONAL FOUNDATION Source: Foundation’s reports

FUNDS DELIVERED TO NGOs IN 2007 TOTAL:44,50 Mil. € N. LOTTERY:24,15 Mil. € BUDGET:20,03 Mil. € FOUNDATION: 0,32 Mil. € 14 Source: Government’s report

STRUCTURE OF FUNDING IN Source: Government’s report

THE ROLE OF TECHNICAL ASSISTANCE ECNL has played a critical role in the development of a sound legal framework and transparent mechanism of public financing of NGOs in Croatia: - long-term commitment - know-how - presentation of best practices - no interference in decision-making 16

Thank you! This presentation has been produced with the financial assistance of the European Union under the project “Strengthening the Legal Framework for Citizen Action through Freedom of Association,” implemented by the European Center for Not-for-Profit Law. The contents of this presentation are the sole responsibility of the presenter and can under no circumstances be regarded as reflecting the position of the European Union. Copyright © 2008 European Center for Not-for-Profit Law