6. Resources

6.1 Teachers

Teachers are challenged by a continuous decrease in the number of students. In Hungary, the proportion of teachers and other school employees within the total work force is high by comparison to the OECD countries. The teachers and other staff employed in the public education system represented 3% of the labour force in 1992, whereas the rate was 2.4% in the OECD countries. In 1994/95, the regular public education system employed a total of 125,859 teachers (including teachers in workshops in vocational education).

The number of teachers increased by 5% between 1986 and 1995 as a result of two opposite trends (see Table 6.1).

Table 6.1
Number of teachers in general and secondary schools, 1986-1995

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	General school	General secondary school	Vocational secondary school	Vocational school
1986/87	89,611	8,286	10,241	11,591
1987/88	90,925	8,646	10,538	11,651
1988/89	90,620	9,103	10,981	11,745
1989/90	90,602	9,656	11,769	12,044
1990/91	90,511	10,246	12,656	12,060
1991/92	89,276	10,732	13,285	11,766
1992/93	88,917	11,290	13,983	11,451
1993/94	89,655	11,959	14,862	11,251
1994/95	89,939	12,578	15,338	10,939

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Source: Statistical Yearbook of Hungary, 1995, Central Statistical Office

The number of teachers in general schools remained relatively stable during this period. The number of those in vocational training decreased by 11%, and that of the teachers in secondary schools (i.e. general secondary and vocational secondary schools) increased by 55%. 70% of the teachers are employed in basic education, 22% in secondary education providing matriculation examination and 8% in vocational training.

The students/ teaching staff ratio is much lower in primary education than the OECD average (see Table 6.2).

Table 6.2
Students/teaching staff ratio in Hungary and in the OECD countries, 1994

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	Nursery school	Primary education	Secondary lower level	Secondary upper level	Secondary education together
OECD average	17.3	17.5	15.8	12.9	13.8
Hungary	11.3	10.2	10.7	11.8	11.2

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Source: Education at a Glance, 1996, OECD

Between 1989 and 1992, this ratio increased temporarily in vocational institutions (see Figure 6.1), which indicates that the baby-boom generation was channelled into such types of schools as, for instance, the special vocational school. General secondary education, more prestigious in other respects, was not flexible enough to admit the surplus of students.

Figure 6.1
The number of pupils per teacher by level of education, 1985-1994

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Source: Statistics of the Ministry of Culture and Education

The ratio of students per teacher in 1995 was lower than in 1985 in each type of educational institution. The lowest students/teaching staff ratio can be seen in general schools. The number of students has decreased since 1987 by more than 300,000 from 1,300,000 to less than one million. At the same time, the number of teachers had been slightly increasing till 1995. One of the reasons for the slight increase in the number of teachers in general schools while the number of students was decreasing is that the demographic changes coincided with new developments in the field of education. Many new schools were established (both denominational and village schools with increased autonomy), which maintained the demand for teachers. Today funds are running short to maintain a part of the small schools, many provider municipalities have even run into debts, and have to dismiss teachers. The educational administration therefore encourages the development of further training and retraining system for teachers. Teachers are public employees (since 1992), but they are employed by local municipalities. However, the scope of central and local responsibilities in financing the salaries of teachers is not clearly defined¹. One aim of the present educational policy is that quality issues should be taken into account in the employment of the teachers. Therefore a system of continuous training and special examinations for teachers is to be implemented. Due to oversupply in teachers, the proportion of unqualified or insufficiently qualified teachers has gone down. The number of teachers without qualification decreased between 1991 and 1993 by 50% in vocational training (see Table 6.3).

Table 6.3
Distribution of teachers by level of qualification, 1985-1994

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	Secondary school teacher	General school teacher	Nursery school teacher	Not having higher qualification	Not having secondary qualification
1985/86	53.3	41.8	0.6	4.4
1986/87	53.5	41.9	0.7	4.0
1987/88	52.7	42.5	0.7	4.1
1988/89	52.9	43.0	0.7	0.6	2.8
1989/90	53.3	43.2	0.7	0.6	2.2
1990/91	58.0	39.2	0.7	0.5	1.7
1991/92	54.8	43.2	0.5	0.6	1.0
1992/93	54.8	43.2	0.5	0.7	0.9
1993/94	54.9	42.8	0.5	0.7	1.0
1994/95	54.8	42.9	0.5	0.8	1.0

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Source: Statistics of the Ministry of Culture and Education

6.2 Expenditures

6.2.1 Public expenditure on education

Approximately at least 95% (in 1992, 99%) of the costs of educational institutions in Hungary are met by the state and local authorities and less than 5% by the private sector. The public sector spent HUF 234,278 million on education in 1994. This was 1% more in real terms than in the previous year. The proportion of public sector expenditure on education compared with the GDP was 6.38% in 1994. 1992 proved to be a turning-point. As a result of the fall in the GDP, the rate of expenditure on formal education compared with the GDP rose to 6.66% in 1992. In the previous years, it had been over 5%, which placed Hungary nearly to the top of the list of OECD countries in 1992. After 1992, the proportion of educational expenditure compared with the GDP began to decrease slightly as the GDP ceased to fall (see Table 6.4).

Table 6.4
Expenditure on education compared with the GDP and to the total public expenditure, 1989-1994

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	1989	1990	1991	1992	1993	1994
Total public expenditure on education in total public expenditure	7.81%	9.10%	9.35%	9.42%	8.91%	8.36%
Public expenditure in pre-primary, primary and secondary education in total public expenditure	5.73%	6.67%	6.83%	7.61%	7.12%	6.61%
Total public expenditure on education to GDP	5.08%	5.60%	6.15%	6.66%	6.53%	6.38%
Public expenditure on pre-primary, primary and secondary education to GDP	3.73%	4.10%	4.49%	5.36%	5.21%	5.05%

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Source: Statistical Yearbook of Hungary, 1995, Central Statistical Office

Despite the fact that the GDP has been rapidly diminishing in recent years, expenditure on education has been able to preserve its real value. Since 1989, there has been a 20% decrease in the GDP, while the total expenditure on education in real terms has not decreased (see Figure 6.2).

Figure 6.2
The trend in expenditure on education and in the gross domestic product in 1989-1994 (1989=100%, real terms)

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Source: Statistical Yearbook of Hungary, Central Statistical Office

The current expenditure on the system of regular education grew quicker in real terms between 1989 and 1994 than the number of students (see Figure 6.3).

Figure 6.3
The trend in real expenditure and the number of students in the pre-primary, primary and secondary education, 1989-1994

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Source: Statistical Yearbook of Hungary, Central Statistical Office

Whereas the number of students was continuously falling, there was a tangible increase in expenditure in 1992. The reason is that the Act on Public Employees was passed this year, and it brought about a one-off increase in the salaries. It had a greater effect on secondary and higher than on pre-primary and primary education since the teachers there have higher qualification and their salaries increased more.

The major increase in expenditures in real terms in 1992 can be attributed to the fall in the inflation rate as well. Comparing public expenditure per capita in nominal terms by levels of education to the rate of inflation, a more significant growth can be seen in expenditure per capita than the rate of inflation between 1987 and 1990 on each educational level (see Figure 6.4).

Figure 6.4
Trend of public expenditures per capita by level of education and the rate of inflation, 1987-1994 (previous year=100%)

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Source: calculated figures, Statistical Yearbook of Hungary, 1996, Central Statistical Office

Differences between the educational levels were more significant after 1991. Where the number of students was rapidly increasing, such as in secondary and higher education, the growth rate of expenditure per capita was lower than the rate of inflation, while where the number of students was decreasing, such as in basic and vocational education, the growth rate of the expenditure per capita was generally higher than the rate of inflation. It is worth examining the change in the expenditure per capita in real terms (see Figure 6.5).

Figure 6.5
The trend of expenditure per capita by level of education in real terms, 1985-1994 (1985=100%)

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Source: calculated, Statistical Yearbook of Hungary, 1996, Central Statistical Office

Figure 6.5 shows that the expenditure per capita in basic education did not cease to rise. This type of education has become relatively expensive, since the number of students is tumbling, but the expenditures on the salaries of teachers are relatively high due to the Act on Public Employees².

The expenditure per capita in secondary education has decreased in real terms since 1990, but it is still high in general secondary education, which was not so flexible to admit students as the vocational secondary school. The expenditure per capita in vocational schools began to rise in 1991, as the number of students dropped. Due to the growing enrolment rate, higher education seems to be much less expensive than it was in 1990.

In Figure 6.6, expenditure is decomposed into the levels of education. 45% of it covers basic education (including the level of lower secondary education), 15% pre-primary, 14% secondary, 7% short vocational (apprenticeship) and 19% of the tertiary level education. (For absolute numbers, see Table 6.5.)

Figure 6.6
Expenditure in the formal education system in 1994 by level of education

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Source: Statistical Yearbook of Hungary, 1996, Central Statistical Office Table 6.5
Expenditure on education by level, 1989-1994, HUF million

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	1989	1990	1991	1992	1993	1994
Nursery schools	11,084	14,172	19,263	25,002	30,822	38,427
Basic education	33,903	44,902	57,891	81,215	95,342	114,956
of which: general school	23,837	32,135	42,428	60,714	70,704	85,500
of which: day-care	8,595	10,844	13,060	15,144	18,476	21,985
Secondary education	18,781	26,249	34,987	51,399	58,720	66,872
of which: vocational schools	5,444	7,603	10,283	14,747	16,030	18,021
of which: secondary schools	8,843	12,841	16,835	25,991	30,841	35,913
of which: boarding schools	3,176	4,144	6,290	7,298	8,174	8,697
Higher education	11,248	15,581	20,751	33,003	39,103	49,155
Courses	2,573	3,311	4,101	1,737	3,445	3,436
Foster homes	4,377	5,998	10,233
Other	1,088	1,449	1,915	3,490	4,095	5,516
Renovation	3,833	4,208	4,446
Total	86,887	116,470	153,587	195,846	231,527	278,322

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Source: Statistical Yearbook of Hungary, 1995, Central Statistical Office