FINANCINGOF HIGHEREDUCATIONIN THE

REPUBLICOF CROATIA

Zoran Kovaievitt & Boris Sisek)

U D K / U D C : 3 7 8 . 4 . 0 1 4 . 5(4' +39.75 )
IEL Ir.
Review/Preglednirad
Received/Primljeno: fat.ruarr' 10,2007 I 10'sijetnla2007'
Acceptedfor publishing/Prihvaceno za tisak:Nlarch18,2007118.o2ujka2007.

Summary
In torlay'sworfulknot,letlgehas becomethe basicresoLo'ce tt-feconomicdevelopme til.
Hencethe neecl adetluate.functioning of higher education in
st'stcrn every modcrn i().iL'l.li
for
ComparingCroatia witlt other OECD and E(J countriesgit'esadditional insightsirtto tlrc
positionand role oJhighereducationin Croatia'stransitionolprocess, It1 this poPer w()are
-focused
onthefundingsystem of highereducation in Croatio. The paper intends to explainthe
ratio betweenbudgetary and own-source revenues o,l'higher education instittttiorrs.
funding
In adrlition to that, we are intiresteclin the criteria for the allocation of budget l'unds,in
the waysof raisingo1.4|n-source reyenues,and in the characteristics o,fthe representaliort oJ
uniyersities'expenditures. Data obtainedfrom the analysis is compared to the desirable role
of highereducationfunding in the implementationof the re.fbrmoJhighereducation.
Key words: higher education,university,Jrnancing,budgetaryJtnancing,own
revenues.

I. INTRODUCTION

In theworld todav,the intellectualcapitalandinvestnientin knorvledgeandeducatiot.t

arethe lrain factorsof economicar.rdsocialdeveloprnent,ancl of increasingcomPetitive
advantages. In suchconditionsemergesthe term Thellen,EcLtn orr,r.',
basedon nervbusiness
opportunitiesprovided bv an increasein the amount of knolvledge,and by intensificcl
applicationof informationand communicationtechnologies. Knoivledgeis norv tntrre
important thenit haseverbeenbefore,sothe expressiottTlrc Knov'ledge BnsedEconomycitrt
be usedas a svnonymfor modern economv.The major resourcesfbr the creationof value

I Ph. D. Zoran Kovaievit, AssociateProfessor,Faculty of Economics & B u s i n e s sZ, a g r e b ,E - m a i l : z o r a n

kovacer,ic@efzg.hr
I Ph. I). Boris Sisek,AssociateProfessor'Fircultvof Ecortomics& BusinessZagreb,Ir-n-rail:
boris.sisekt4leiig.h r

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BR.1

rather inlurrterial'
areno longersoil, ph,vsicallabour,equipment,tools' anclfirctories,but
Sucha stateof affairsinfluences the change of the of all
cl.r:iracteristics
intellectualassets.
of thoseof highereducation lt nleans
irlstl that it is rle'cssilr\tr) ririsc
especially
activities,
the levelofquality ofthe entircsvstemofhigher education'

This work analysesthe characteristics of higher educationin croatia from 1996

ot'tits
(rvhenAct on Higher Education\\.aspassed)till the presentday r'vithspecialstress
hal'ebeenpassed, nervhigher
linancing.Durin[ this perioda number of new regultrtions
setup, and status of son.reold ones haschar-rged'We presellt
educatio-ninstitutionshavebeen
period in order trl dra$' comparison rvith OECI)
key indicatorsregardingthe observed
and financing of higher education).It is important
countries(structure,legalfran're.,vork
Iine
that Croatia'sentirehigher educationsystemis in the processof reform in
to ur-rderline
with the BolognaDeclarationthat was introduced in the school year 2005/2006'
much closer
Gradualimplementationof the aboveobjectiveswould bring croatia
to a knowledgebaied societr,'. This is just the first phaseof the refbrm rvhich rvill require
into two
great effort tl complete.Namel'', study programmeshave to be tra'sfbrmed
needs to be introduced; qualitY control of higher eductrtiot]
Ivcles, and a credit system
cr'cle'as
neeclsto be introduced;{octoral study needsto be setup asthe third educational
and for duration of higher educatiort These
lvell as a systemfor recognitionof diplomas
process of transition burdened rvith dilTerentmacro erncl
changesaie taking placein the
and requirerestructuring of econorny at.rdreform of the public sector
micrJ imbalances,
(health,education,pensions,vstem). Againstthebackdropo{'heawbudgetdeficit,demands
on public
to in.r.ur. funding for higher eclucationaretreatedmore asan additionalstrain
i nt f u t u r e .
e x p e n d i t u rteh a na si n v e s L l n e n

2. MAIN CHARACTERISTICSOF HIGHER EDUCATION

IN CROATIA

Higher educatiol in the Republicof Croatia (RC) as rvell as in OECD cor'rntries

is increasinglybecoming a rule and the younger population is expectedto enter higher
at
education.Shareof higher educationin the total population of RC at presentstands
(the average
79tr.In terms of overallworkfbrce the shareis higher and standsaround l67o
rvith structuralchanges of the country'seconom,v (lnore
irr OECD is22o/o).Inaccordance
serviceorientedand lessindustrialised),that is, changesregardingthe tvpe ofrvorktbrce
in demar.rd, job structureis increasinglychanging(measuredby educationalstanclarcls of
ivorkers).It simplv meansthat not only young but also a grolving tlumber of older peclple
aretrying to entersomesort of highereducation'
Although in relativeterrnsthe numberof highereducationit.tstitutions and students
grown,it wasnot foliorvedby a simultaneous
hasdrasticall,v increasein the number of teachers
anclassistants(thevnurnberaround7-Btl.rousand). This sholvsthatthe natureand qualit,vof
theeducationalprocesshasnot significantlyimproved.lt couldbe evensaid that the qualifv
of educationhasbeenimpairedasthe pressureon the existingteachingstaffhasincreased.
The ratio teachervs. studenthasincreasedin the observedperiod from I :10to 1:14'

r40
 IIVRSNOST
POSLOVNA ZAGRTB,
GOD,I (JO(]7)
BR,] 2.,5isek
Kovarevic B.:Financlnq

Lt the Republicof Croatiain theperiodfrom 1996to 200.+ of irrouncl-1.9,001)

an average
people grirduatedfronr seconclarveducationet'eryvear (around 31,000graduatecltr-tlrll
gralltnlar,technicalor somesimilarschoolqualifiedto pursueturtherhighereducirtion).
As around45 thousandstudentsenrolledeveryyearat highereducationinstitutir,rns (-17
thousandin the lasttwo observed-vears) it is clearthat not clnlvsecondarl'school stuclcnts
continuetheir education, but a numberof olderpeopleasrvell.It is estimatedthat around
-
7Q 75 percentofhigh school graduates enterhighereducation.

Central Bureauof Statisticshasconducteda survet'on educationalqualificationof

Croatianworkforce.'fheshareof employees who haveeithernot finishedprimarl'school,
or haveonly primary edticationis 20.6 %, and thus exceedsthe shareof emplo1'eesrvith
a degreefrom a schoolofprofessionaihigher educationor a universitl.,rvhich standsat
The largestportion of Croatianlvorkfbrcehas seconclaryeducation(60?").
19.,19/o.
'fhere
aretr,vokei,differencesbetweenhighereducationin RC and OECD cotttttries:
'Ihe
1. lhe levelof completionsuccess is signi{icantlyhigherin OECD countriesand 2. ratitr
oistuclentsenrolledat universitiesand schools of higher
professior.ral education does r.tot
correlate.In OECD countriesaround70%of enrolledstr,rdents complete their education,
rvhilc in RC the percentageis betrveen35-400/o. This is not unexpectableif rvebearin mind
the secondkey dilference.In RC 70%of studentsenrol at universitiesand 300/o at schools
o1'professional highereducation(presumablyeasier).in OECD countriesthe ratio is the
other rvayaround,that is, more studentsenrol at polvtechnics.
Over last four vearsan averageof 15,000studentsgraduated(the averagein the
period from 1990to 2000r,vasaround 7,000).Out of that number,12,000graduatedfiorn
universitiesandthreethousar:rcl from schoolsof professionalhighereducation.The at'erage
length of study in RC is 7.5yearsand the estimateindicatesthat onll' 20-25o/o of students
graduateon time, while 65olo of studentsnevergraduate.Over lbur thousandgraduates are
olderthan 27,which is theconsequence stud,vperiod' but increasinglv
of a relativelylengthir
alsoof the ageof someof the enrolledstudents.
Despiterelativelyhigh ratesof enrolled studentsat higher educationrnstitutions
irr RC, tlre shareof voung people with a university (or a polvtechnic)degreeis 20-25oto,
primarilv becauseof a relativelyhigh numberof drop-outs.Only I 57oof the adultpopulation
in RC hasa universitl'degree.Having in mind a relativelyhigh nurnberof studentsamong
Croatiasyounger population,it could be said that if rve increasethe rate of cornpletittn
success, it will be possibleto improve significantlythe situationin RC in a relativelyshort-
term period.

During lastten yearsthe structureofgraduatesfrom higher educationinstitutiorrs

in RC hasundergonesignificantchar.rges. The period hasseena big increasein humanities
students(from 45% to 630/o), ancla relativelysignificantdecreasein studentsof techr.rici.rl
(fronr 3loloto 22o/o)and biotechnical(from 7% to 4%) sciences. This is primaril,vthc
consequence of changein the structureof enrolledstudentsrvhostronglypreferhumanities.
Studer.rts'
preferences havebeen greatlvinfluencedby changeson the job market,that is,
lirnited emplovmentopportunitiesfor thosewith a degreein technicallieids,and relatir.elv
low earningsin the sectoras well.

l.+l
 B.:financing
l,,5isek
Kovarevii
ZAGREB,
IZVRSNOST
PO5IOVNA BR.1
I (2007)
GOD.

tvere
highcr eclttcationit"tstttuttclt.ts
During the observecli2eriod activities.at
ancltnanagernentoi poh'techrlics
by n.rm..o.r. regulations.Establishmer.rt
acLnir.risterecl
higher education has been rcgulatedbt' r'ariottsprovrsrous'
anclschoolsof professional
cietertnine
statutes rnoredetaiiedcontlitiorrs
determinethe statusand iun.liug, lvhile
Lar,vs
of fir.rancing.
Research ActiYities
In 1996Act on Schools of HigherEducationanclAct o|rScientihc
framervtlrk for liigher education' tl.rrrtis'
iverepassed.The tlvo Acts setout an institutionai prol'isions
andhow theyoperate,ancltheyalso made ke,v
horvthe institutionsareestablished
unified into one
rverefinal11'
regr'llations
tbr scientiflcand researchactivities'Thesevarious
a c t ( A c t o n S c i e n t i f i c R e s e a r c h a n d H i g h e r E d u c a t i o n ) . T h e A c t r v a s p a s s e d o nof
23Jtrir',2
irtstittrtion as everl'institutio'
ariclamendedin Jul,v, zooi. it,lehnei highereclucotion
andoperateeclucational programmes in scientific'
hisirereducationauthorisecl to establish
of l-righer edttcirtion include universities'
highli,professional or artistictields.Institutions
poil't..nrli.., anclschooisof professional highereducatiotr'

IntheRepublicofCroatiathereareS5instittrti<lr-rsoihighereducation:
-intheZagrebareathereare4linstitutionsoflrigherecltrcation:Unir.ersitr'oiZagreb
oneteacheracadem)" and oneuniYersit)'coLlrse
lvith 28 faculties, threeartisticacademies'
clepartmentS;Social StudiesPolvtechnic
stud1,;TechnicaiPohtechnicirr Zagrebwith seven
in Karlovac$'ith trvo departrnents;Police
in Zagrebwith threea.p-t^.rrt.lpolytechnic
AcaderrryinZagreb;HealthStudiesPolvtechnicinZagreb,AgricrrlturalCclilegeinKri2er'
ancltrvclteacheiacademiesir.reakovec and Petrinja;
-intheSplitareatherearel6institutionsofhighereducation:Urriversitr'o|Split
one teacheracadelnv'and
with nine t-aculties, or,...u.1.*1,, Collegefor Nlaritime Studies,
poiytechiic in Dubrovnik rvith 3 departnrents'School lbr
two universit,vdepartments;
Tourism and lvlanagement in Sibenik;
-intheRijekaareatherearel4institutionsofhighereclucatiorr:.UniversitlofRijeka
in Rijekaivith 6 departments;
with l0 faculties,3 teacheracademies'Polltechnics
-inosijekareatherearel2institutionsofhighereducirtion:Unil'ersitl'ofOsijek
rvitl-r9 faculties,oneteacheracadem,v, oneuniversitvdepartmentand Poh'technicin P<l2ega
with 3 departments;
lor
- Univeristvof Zadar has 15 ut.riversitydepartmentsand one clepartr.nerlt
professionaleducation;
higher
- Universit-vof Dubrovnik and 14accreditedprirrateschoolsof professional
education.

Thereis no doubt that sucha clisperseclstructureofhigher educationinstitutions

'I1.re
framelvorkshouldenable
requiresan adequatelegislativeand institutionalframervork'
at the sametime complyingrvith
the implementation.ri goalsin the educationsector,
activities,asrvellasrvith the prir.rciples
oieduc,rtionaland scier.rtific
specificcharacteristics
to the alreadymentioneciacts
on rvhichEuropeanhighereducationis based.ln addition
implenientationof objectivesin the
and regulations,the institutional framework for the
Educatior.r andSports'NationalCour.rcilfbr
educationsectorconsistso1:Nlinistryof Science,
HigherEclucation'NationalCouncilforScience,AgencyforScienceandHigherEducatio
fbr Science'HigherEducationanci
and NationalENIC/NARIC O1ice,NationalFoundation
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BR.1 Kovacevir
2,,5isek
B.:Financing

'fechnological
Development,and somebodiesof the University(Vice-Chancellol
Ofhcc,
selectcommitteesetc).
Senate,
The presentsystemis featuredby over-regulationand a high level ofbureaucrao'.
Fartoo manlz141a75 and regulationsexist.Differentconsentsand permissionsareconstantlv
requirecl,thus hindering smooth functioning of the lvhole svstent.Too much paperl'ork
points to the statet aspiration(Ministry of Science,Eductrtionand Sports)to manage
directly aff'airsin scienceand higher educationfielci.National Council for Science,and
NationalCouncilfor Higher Educationarealsoinstrumentalised as prof-essionalsertice
anclare subordinatedto the relatedministr,v. Thus,autonornl'of the based
universit.v, orl
the pointsbelow,is under threat:
- internal organisation
- establishmentof educational,scientific,artistic,and professionalprogramr"nes
- decisionson projectapprovalsand internationalco-operation
- establishmentof regulationsconcerningstudyingand enrolment
- electionof officialsand teachingstaff
managementof resourcesavailableto higher educationinstitutions
- linancialautonomyaccordingto the Laur ('Advtrnce2001'l Developmentstrategv
tbr tl-reUniversityof Zagreb,February2002,p.a).

One of the competentauthors,G. Flego(a former minister of science)sa1.s the

follorving about the autonomy of the university: "In terms of Croatia'slegislation,the
ar-rtonomy of universitiesdoesnot exist,that is,academicautonomvis nonexistent.Nantell',
legaland/orexecutiveauthoritiesplaya decisiverolein I . electionofollicials at universittcs'
institutions(administrativecouncils,rectors,deans);the,valsoplay a role in 2. creationo1'
educational programmes; 3. selectionof teachingstaff;4. enrolmentquotas"(Upbringing
and Education,Whitepaperon Croatianeducation,Zagreb, Septernber2002,p. 8l).

Successfulfunctioning of educationalsysterr-r requires an adequatequality'

managements,vstem. It includes:the quality of the managementof higher educatior.t
institutions;thequalityofscientificandresearchwork andprojects;thequalityofcurriculunr
and svllabus;the quality of the meciianismsof measuring,anal,vsing, and improvir.rg;the
qualitvofdevelopingteachers'expertise, and the qualityofinternal infrastructure.

One of the first studieswas done at the end of 200-5b,vthe Quality lrlanaging
ComrnitteeoftheUniversityofZagreb(Report,2006:p. l-i7). Ahalfofpublicir.rstitutions
of highereducationin Croatiairresituatedrvithinthe Universityof Zagreb,rvhichis allocated
7096of thebudgetfunds earmarkedfor all Croatianuniversities,and'"vhichernploys70%of
the total nurnberof employeesat Croatianuniversities.Headsof 23 constituentpartsof the
Universityof Zagrebtook part in the survey.Thesurveywasdominatedbv questionsabout
qualit,vmanagenlentsystem,its formalization,documentsrelatedto quality,and the rvavs
'fhe
of evaluatinga quality managementsystem. researchresultsshorvedthat the preserlt
levelof implementationof the qualitysystemis not satisfactorl'.Leadingpeopleat faculties
arenot lvell informed about the terminologyrelatedto quality The surve)'alsorevealeda
senseofvagueness regardingdefinitionanddocumentation ofbusinessprocesses athigher
educationinstitutions,and activitiesaimed at quality improventent as well.

143
 (ovacevic B.:Finanrinq
Z.,5isek
p05Lo\/NA G0D.
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lzvRsNOsT I (200i)BR.1

(internalatrdertertrrillof the qualitvmanagement

Theresultsconcerninge\raluation
paper.In thc lastthree,vears thererl'rrsno
svstemarevery interestrngfir th" topicof this
other al..rost
hancl' of
409''ir the co'stituent
the taculiies.On the
externalevaluationat 4:%o"of
the societv the
|reecls profile of students they
partsarenot concernedwith to lvhich extent
areeducating.

3. FINANCING OF HIGHER EDUCATION

AnadequateSystemofflnarrcingisavitalprerequisitetbrirnplementatiorroithe
croatia is currentlfin accession trrlks
retbrmprogrammeharmonizedwith EU'ssystem.
to education' Therefore' it is necessarl'
rviththe tu, and oneofthe openedchaptersis related
of the financing of public unir,ersitiesin tlre EU (,'Advarrce
to presentcommon features
2 0 0 1 . : p P 3 5 - 3 7 ) . D i r e c t s t a t e t i n a n c i n g i s t h e m o s t i r r - r p o r t a n t s o u r c e o f fand
undsatpub
of a lump sum'
universities (48-100%).universitiesreceivestatefunds ir.rthe tbrm
t h c l ' e n j o y a h i g h d e g r e e o f a u t o n o m y i n d i r e c t i n g t h e i r e x p e r r s e s . T h e a m o u t and
]toftirrlds
of enrolledstr,idents, both graduate
is subjectto change,u, iiJ.p.na. or-,th. nu-b.r
p o s t g r a d u a t e o n e s , a n d o n t h e n u m b e r o f e m p l o y e e s ' l t i s i r n p o r t a n t t o n o t e of thatstate
and teachingqualit1"The evaluatior]
financingis conditioned by the level of research
a,-,dexternalsupervision'The amount of
the q*ality combinesconsiant self-assessment
or studl'groups.Developmental funds
allocate6funcl,ain'.r, u..o.jing to the tlpe of studies
maintenance) are increasilgly
(crucialinvestmentin facititieslequipment,and investment
rvherebytheir responsibility
being integratedinto the total f.r,td. ullo.ut.d to universities,
anclclegreeof autonomyare increased'
Businessautonomyimplies the following:
-statefundssufficientforimplementationofestablishedgoals'intermsofboth
quiintity and qualitY'
- liberalizationof the managementof allocatedstateflrnds within the framelvork
of an independentlyplanned universitybudget'
- responsibilityfor the managementof allocatedstatef undsin accordancervith laws

anciotherregulations,butalsowithuniversities.olvnstratcgics.

rvhileonly thebeststudents
t-ee,
Around 70%of studentsin the EU paytheir tuitior-r
payingthe fee.Tuition feesarenot an
and the most unclerprivilegedonesareexemptfrom
the EU (asa rule 2-77o)'By meansof
inrportantsourceof r.v.nies at stateuniversitiesin
which thereis demandon the market'
statesubsidiesstudentsaredirectedto the studiesfor
then-rselvesto cooperation
Due to a decreasein statefunding, universitiesare redirecting
through projects, and expertise'
cot.rsulting'
rvith economyand non-profit orlanizations
still not an important source of income at universities
Holvever,suchmarket ."u"n.r., aie
i n t h e E U c o u n t r i e (s3 - 4 u o f t o t a lr e v e n u e s ) '
of an activitysignificantl,vinlluencehorvthat activityis
Fundamentalcharacteristics
goirrgtobefinancedandinstitutionallysetuP.ItiSimportanttounderlinethateducationisa
hencecannotbe organisedexclusivelv
publicgoodthatasan activityhasspillovereffectsand

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2,,Sisek nq

on marketbasis.in manysociaiareasmarketis eitherinadecluate or insuficientregulator.

Silce inceptionof freemarketwehavehaclmarket firilures(con-rltetition
failures,production
of publicgoods,externalfactors,insr-ilicientmarketsand information).
inaclequirte In caseo1'
productionofpublic goodscompetitionis unsustainable (nionopolistic structure fornleci)
is
anclthere is a probiernof congrr.ritybetweenmaximum prtlfitsof privatecompaniesancl
meetingrviderpublic(social)requirernents. As therearemarketfailurestherearealsofailures
of the statean{ its activities(lirnitedinfonr-ration,Iimited controioverbureaucracl', political
lil.ritationsand limiteclcontroloverreactionsof privatesector).'fhisis the reasonrvhl'so
rrranl,public sectorinelicienciesemergeand are reflecteclir.rinsulhcientorgar.risirtional
incentives,limitationsrelateclto human resources, in proctlrenlent,budgct
limitatior-rs
restrains, bureaucracy andlacko[propensit,v to takerisks(Stiglitz,2000, p 200-204). Hence,
the organisationand financingof higher educationfacesthe problemof horvto selecttl.re
right combinationof market ftrrcesand stateadministratiorl'

So far financing of higher educationin Croatia has beencharacterisedb,vstrong

centralisation. Higher educationinstitutions(universities,tacultiesand institutes)are
directlyfundedthroughthe Ministr,vof science, educationand sport.Faculties and other
constituentpartsenjol'considerableautonomyin their relationto the universitiesbut are
still insufficientlyautonomousasregardsthe state,that is, respectiveministry Six existing
'fhe','
universitiesareformallv autonomousbut financiallythe,vdepenclon the statebudget.
areall formally autonomousand areuniversitiesdue to high numberof scientific,teaching,
artistic and other units that are characterisedby their legalentitir Due to that situation
there are many organisationaland financial irrationalitiesin the activitiesof universities
and theyareunableto undertakeresponsibilityfor deveiopn:rent of their highereducatior.ral
institutions.Thereis a need for more integrated universitl'rvhere decision-makingrvoulcl
hemore j o i n e d - u p a
t h u sa l l o r v i n g l l p a r t so f t h eu n i v e r s i t t
v o . r c r
t ri t h n r o r eh a r m o n vi t t t . l
co-operationso asto adequately respond to all challenges put betbre scientificand higher
educationactivities.How well relationship issues betrveen taculties and universitiesare
resolr,edwill significantlyimpact reform of higher education anci model of its financing.
'Ihere focus on the legai
are severalproposaishow to solvethis problem and all of them
entit,vfeaturesof the faculty.
One of the proposalsis to abolishlegalentity statusfor f iicultl,and to basethe model
of universityorganisationon the following three levels:
I ) activitieson thelevelof integrateduniversitv,2) activitiesthatwouldbeperformecl
ivithin regional institutions (accordingto scientific fields),ancl3) activitiesthat rvould
be performed within individual constituentparts of the university(faculties,institutes,
departmentsetc).The authorsof this proposalclaim ('Advance"2001,p l3) that this
new organisationalstructure wouldn't significantlyreducefinancialand administrative
autonomy of presentday constituentparts of the universit,vand their pro-activit,vand
creativity lvould be maintained.Fur.rdsfrom university allocationrvould be disbursed
graduallyto regionaleducationalinstitutionsand its parts (faculties,etc) aftertuition lbr
stucliesand other relevantfactorsr,vouldbe determined.Cor"rstituent parts of universities
would be able to independentlymanagetheir own earnedrevenues.Therewould be an
agreementfor a small portion of direct revenuesto go towardsactivitiesof the integratecl
university So far lve have had tlvo levels of university organisatiot.t: university and its

t45
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2.,5isek
Kovaievit
IZVRSNOSi
POSLOVNA 60D'I (2007)BR.1
ZAGRTB,

c o n s t i t u e n t p a r t s . F a c u l t i e s a r e l e g a l e n t i t i e s a n d . a r e g r e a t l y change
i n c l e p ethat
n d erapport
ntoftheurrir'er
ivlinistry.'fhere is necessitl'to
but insufficientlyso i., r.i",ion tJthe that lvould tl-ran
are transposedto the universities
so that some authoritiesof tiiculties
reinforcetheir autonomy t'isa vislvlinistry'
n o tb ec q t r l t t i olnn a r kb e t r v e einn t c g r ; i t l t t
O t h e rp r o p o s a lssu g g e st l|r' a t h e r es h o t r l d to rigid
ru.ntty und that rveshouidnot be slaves
of u'iversities and legal."1i' i;;;iin. the rvorlcl that
there are specialiseduniversitiesin
solutions.Namel,v,it is consiiereclthat Also there
to the existinguniversitiesin Croatia' -ihis
in terms of sizeanciq.tut'if tut'"tponcl
higher educationlnsdtutions lvith the sarneranking asuniversities'
are independent
p r o p o s a l a l s o u n d e r l i n e s t h a t t l r e a u t o n o m y o f u r r i v e r s i | , s hthe o u l d c o n t a i nrvoulcl
therig be htfor
legalentities.Therefore universit,v
universityto o.gu.,ir. itJi*ith or rvithout Ii'rited
legafentities,but that autonomywouldbe
the founder of faculties,which would be
fu'ctioning of the universit)''Son-re
in so far as it would u. n...rror1' for comirehensive
legalactsshouldclearlyd.nn.o.',,r,o,itiesofuniversit,vandlhculties(andatthesametime responsibilities
determineminimum autonomy)and after that establishfinancial
"fin.i.
o f t h e u n i v e r s i t y a n d i t s c o n s t i t u e n t p a r t s . T h i s d i s c u s s i o n i s t a k i ncome
g p l a cinto
e a t tefl'ect
hetirr-reof
university financing that should
expectedtransitronto u .,"r" svstemLf
universitiesrvill be financedfrom the state
as at 1 January 2x06.Fromthai clatecroatian
b u d g e t a l l o c a t i o n t h a t w o u l d g o t o t h e u n i v e r s i t i e s a n d n o t f a c u i t i e sfinancial
. T h e a l lpolicy
ocatedlrrmp
parts dependingon the agreed
sumwouid be dividedbetweenconstituent
o f r e s p e c t i v e u n i v e r s l t y ' t l r e r e i s f e a r t h a t s u c h f i n a n c i n g r v i l l l e a d t o o v e r a ltrvit]g
lreductionot
fiercecompetitionbetrveenuniversities
statefunding for higher .iu.ution and to
leadto market competitionof high education
to win their sliceof statezu"at"g. It will also
servicesasfinancialstandingofrespecttvecomponentwilldependontheamountofmonev
ability of the componentto earn as much
the stateallocatedto it, t"'iut"iti and on the
own revenueon the market as possibie'
Apartfromsolvingrelationshipuniversityvs.facultiesthefinancingmodelsinthe
factors('Advance2001'1p' 35):
near future will be un.tit? b,vthe folltwing
-country,spreciselvdetermine<lsocialandeconomicdevelopmentStrateg}.'
vertical educationdevelopmentstrategy'
- transparentand understandabie
-dynamicsofeconomicgrolvth-qualityeducationnrustbefirrancedbyeconolTlrc
groMh,
'absenceorpresenceofclilemmalvhethereducationisaninvestnelltOr
consumptton,
.acceptablelevelofsharingeducationcostsbetrveenthestateandindividu
citizen.
croatiaone
Therearetwo aspects to the analysisof highereducationfinancingin
and statebudget'Theother aspectis horv
relatesto shareof educnilon.*p.nditure in GDP
hnancingeducation'
financesaresPent,that is,rvhatis the rnodelfor
Forhighereducationandscience(inperiodfromi996to2005)froml.l3o/oto
1.36%of GDP wasused.
r46
POSLOVNA ZAGREB,
IZVRSNOST I {2007)8R.1
GOD. Kovacevic B.trnanc
Z, 5isek nq

.l
Table : Shareof scienceand higher educationin GDP anclstatebuclget

(70)
Description 1996. 1991. 1998, 1999 2000. 2004. 200s.

5hare andhigher
ofscience 1,19 1)9 1,29 r,35 1,16
1.11 1,09
inGDP
education

Share andhigher
ofs(ien(e 1.88 3,16 4,01 1,40 1 1)
3,88 ),87
instate
education budget

Source: Nlinistrv andtechnology

ofscience ofCroatia,200l'
oftheRepublic 2001
OficialGazette'3I1
ancll7ll2004;"Economic and2006;CentralBr-rreau
trends'lZagreb,'U2005 2006.
of Statistics'

Out of 1.35%of GDP allocated to highereducationandscience, the lbrmeraccounts

while the latter
for 0.9596, for 0.409b. This is among the lowestbudget allocationstbr
educationin Europe,particularlv in comparison with oECD countries.

The shareof expenses for all fbrms of educationis 4.'1%oiGDP. This figureincludes
Educationand Sports,allocationsfrom budgetsof
allocatiols by the Ministrl, of Scier.rce,
local communities,budgetfunds of other ministries,privatesectorand universities'orvn-
sourcerevenues.

Statehnancingis the most important sourceof iunding fbr public universities'

althoughthe shareoforvn-sourcerevenuesis on the increase.Statebudgetsecuresfunciing
for higher eclucationthat is disbursedvia the lvlinistry ofScience,Educationand Sports'
.Ihe
levelof funding dependson the number of studentsand estimatedreal costsper
studelt. Ministry allocatesfundsfor irctivitiesin particulareducationalprogramnles.Thcse
funds providefor the following: 1.ernplovees' salariesand col.rtributions,2. running costs,
3. a minimum level of scientilic,artistic and professionalactivity at a higher educatiorl
institution,4.operationofservicesthat guaranteecomprehensive and necessary standards
of highereducation(e.g.studentdormitories),5.scholarships and loansfor students,6.
lvorking and living standardo1en.rployees and students,7. financial aid for scholarships,
developrnent,and investment.

Researchshows(Bajo,2003,p.4,74,140)thatthefunctioningofhighereducation
institutionsis heavilycentralised.On the other hand there areno developedbenchmarks
rvhich the Ministry usesrvhen giving budget beneficiarystatusto a higher educationor
scientificinstitution.Ministry'.sbudgetlackstransparenc)rThis is clearin hnancialrePorts
as they do not provideinformationon financialstatusof individual beneliciaries. It is
not possibleto determinethe structureof expenditure or numerous transtersfor science
anclhigher educationas well as individual allocations.The lVlinistrydoes not have clear
control over its bu<lget,as there is no co-ordinatedplan of its distribution. Horvever,tl're
biggestproblemis that the Ministry allocatesfundsto financeactivitiesof highereducation
institutionsratherthan their concreteeducationalprogrammes.Therefore,statefinancing
shouldtlependon specificprogrammesand their quaiity,that is, on the quality of a higher
eclucationinstitution that shouldbe assessed by the institution itself and an indeper-rdent
oualitv control bodr,'.

t41
 B.:Frnancinq
2.,Srsek
Kovacevtt
IZVRSNOS]
POSLOVNA 6OD.I (2007)BR.1
ZAGREB,

therearosea neeclto lncreLlse

l)ue to a lack of funding b1,the N{inistryof F.ducation,
provi4esourcesof fundi'g rvhich rvo'lcl be
overallallocatio.s for t-righ..iaucation, and
much lessdependenton the public service'
S c i e n c e ,H i g h e r E d u c a t i o r ra n c l
F o r t h a t r e a s o n ,N a t i o n a l F o u n d a t i o n f o r
'l'echnological founded'envisagedasthe nlain
Developmetrtof tl-reRepublicof CroatiarVas
educational, ancltecl-rnological prcljects'
sourceof funding fbr scientific,clevelopmental, its
of the strategic Plan out of lvhich
The Foundationwill nnun.. the projectson the basis o'l'v
It ispossibleto drarv the foundation's fina^cial support
programmehu. u..r-ra..r.iopet1. '11're
through its own prog.o-m.r. programmesof the foundation are intendedto hnance
n" j,o iund conferences rvhichht into the prioritiesof each
projects,to awardscholarrr-ripr,
p . o g . u - n l . a n d m e e t h i g h c r i t e r i a o f e x c e l l e n c e ' T h e r e f b r e , t h e f o u n d a t i o n h a sfbr
setttpa
proceclure ofthe evaluatiJr-r ol,proirosedprojects(StrategicPlanof NationalFoundation
Development2004- 2008,Zagreb,200'1).
Science,Higher e.Iucation.ni t .hnotogical
of the developmentof its educatior.t
croatia devotesmuchattentionto the planning
Pian 2005 - 2010 is a strategicdevelopment
sector.1he Education sectorDevelopntent -fhe
on 9, 200.5. plarr is basedor-ra
document adopteclby the Croatian Government June
and was discussed by numeroussociiri
comprehensivesystemlceducationalframework
the past ferv years. The strong point of the
experts,scientistsuna otn". partnersover
needed irnprovements during the period
clocurnentlies in its ,.unrfrt.n.y regardingthe
of its implementation.
TheaimoftheDeve}opnentPlanistodirecteducatiorralpoliciestowardsthe
includelegalaspects, humanresources'
improvementofthe educationalsystemwhich would
The educationaisystemshouldprovide
{inancialmatters,screntihcaspectsan<lexpertise.
who are participatingin it, as rvell as to societl'
eclucationthat rvould bring benefitto all
asawhole.Thisco]Iectir,..tib.tshoulilincreasethequalitvofeducationthatrvillcatert
or.rknowledgeand democratic
the needsof local culture,econol'nyand the societybased
for all.The point is to definethe content
startir.rg
principles,and ensurethe right to eiucation
development of a higherdegreeof qualit1"oi
ar.rdactivitieswhich would"contributeto the
flexibleancleffectiveeducational system that rvould make intellectual
a more accessible,
of Croatia'
and working human capitalthe kei' assetof the Republic
the largestlinancialsupport
TheMinistry of science,Educationand Sportsprovides
ministries and local governr.nent
to the eclucationsector.In addition to MOSES,other
Thus, when estimating the share of public education
aiso allocatefunds lor education'
to indicate all sourcesof linancing in order
expendituresin GDP terms, it is important
the total budget of the Nlinistry.of Science,Education
to havea full picture.For example,
'1' of the GDP in 2001' ff rve add the expendituresof
and Sportsaccountedfor l percent
theMinistryofScience,EducationandSportstoexpendituresmadebyothercentra
amounted to 4.3 percentof
ministries and at local levels,public educaiionexpenditures
the GDP in 2004.
of
to establisha new sYstetlr
In the courseofthe next planningperiod,it is necessary
the existing,inherited systemof
the financingof higher education.This systemwill replace
ofthe university system' Financial
directstateadministration6f financialsupportfor a part
by the direct allocatio' oi fu'ds io facultieswill be replacedby the allocationof
support
148
 IZVRSNOST
POSIOVNA ZA6REB,
6OD,I (2007)
BR.I (ovacevi( B,:Financlng
2.,5isek ..

lump sumsto universities'management startingon |anuarv1,2007.'lhischangetvill give

unil'ersitiesthe chanceto ciirrl'out tlieir clevelopment strategiesin accordance rvith nirtional
prioritiesand strategies, and the principleof polircentricdevelopment.Effortsn'ill be
lnadeto increasetotal statebuclgetprovisionsfor higher educatiot.t, basedon allbrdabilitr'.
A nrirjoreftbrt wiil be made to increasefinancingfrorl other sollrces,particularlvthe
privirtesector.This particularlyappliesto programmesthat can ostensibl,v nleetthe rreecls
of staffrvhile receivingfunding fror.n sources other than the statebudget. Croatia's highcr
edtrcationinstitutior.rswill be encouraged to compete fbr financial support intended fbr
scientilicresearchprojectsand studi'programmes provided by national and international
(European) bodies.Duringthe2005to 2010period,a studentscholarship rnodelappropriate
to the needsofstudentsand society needs to be developed. This scholarship prograrnlr'ill
targetspecificoccupationsand hur.nan resources throughout the Republic of Croatia.
Developmentobjectives:a) beginning in 2006, a unified model for fit.rancing universities
will be introduced,b) by 2010,the budgetexpenditures on highereducationand science
rvill be increased(EducationSector Development PIan 2005 - 201(.), Nlinistrl'of Science
Educationand Sports,Zagreb,September 2005,pp 37 -38).

Adult educationis an especiallvimportant arearvithoutn'hich the future sociiil

der.eloprnent rvouldbe impossible:competition,increasingeniplol-nrent opporttlnitie\,
social cohesion,activecitizenship,developmentof dernocracl-ancicivil societl',as rvell
as the consistentdevelopmentof all regions.At the end of 200.1,the governmentof the
Republicof Croatiade{inedthedeveloprnent of adulteducationin thefollorvingdocuments:
'A Planfor Implementingthe Strategvfor Adult
Strategyfor Adult Learning" and'Action
Learning'l In the meantime,Drafi Act on Adult Educatior.rhas beer.rintroduced.It is of
centralimportanceto recognise adulteducationasan integralpart ofthe educationsvsterll.
Thisis basedon the conceptoflifelonglearningand the principlesofopennessand equal
access, creativityand flexibilitl'of fbrrns,methodsand content.
Here we presentonly the most important provisior.rs of the above-mentioned
documents.Links betweenpoiicy',theorl' and practicein adult educationrvill be created
by establishingpartnershipsthroughtheparticipationofadultsin the processofdefining,
-Ihe
monitoringand developinglifelonglearning. Ministrv of Science,
Educationand Sports
will havethe leadingrole in coordinatingand implementingthe abovetasks:increase
investmentfrom the businesssectorand the statebudget in adult educationat all levels;
developparticipation and responsibilitvof socialpartners;defineactivitiesand measures
for assertingthe right to educationfbr all citizensduring their lif-etime,especiallvlbr
targetgroups(the unemplo)'ed,war veterans,the illiterate,young peoplei.r'ithinadcquate
education,etc.);conductcontinuousprofessional training ofteacherswho participatein
'Ihe
aclulteducation and training programnles. use of informatiou and cot.nmunicatiot"t
technologies in educationand learningrvillbe encouraged. The improvementof citizens'
educationwill be achievedb1':clecreasing the cost of educationand trainir.rg,l-hile
introducing sorlrcesand mechar.risms for stablefinancing;refbrrningthe traditional
educationalsystemand introducing flexibleeducationalprogrammes;hirrrnonizing
educationalopportunitieswith labor niarket demands,and increasingthe availabilitl'of
offer;recognizingthe knorvledgeand skills
information regardingthe existingeclucatior.ral
acquiredin differentforms of inforrnaleducation;adaptingthe educirtionsystenrto meet

t49
 B.:Financtng
c2.,Sisek
Kovaiev
GOD.
ZAGREE,
IZVRSNOsT
POSLOVNA I (2007)
BR'1

t h e n e e d s a n d c a p a b i l i t i e s o f a d u l t s a s p u p i l s ; s t r e n g t h e n i n g a d t r l tand
. e dclevelopi'g
ucationinstittrtior
educatlonscie'ce; establishing
b' ercouragirg th. a.,r.iof,-,'.rrt or.a"lt
a systemofcluality control in adult eclucation'
Tlrestate,localauthorities,socialpartners,educationalinstitutior-rsandcir'
s o c i e t l ' i n s t i t u t i o n s w i l l c o n t r i b u t e t o t h e i m p r o r , e m e n t o f c i t i z e n s ' m o t i v a trvill
i o nbe
tolearn,
on kno$4edge'Suchmotivation
ar.rclto Croatiat developmentinto a societybised the
encouraginga learningcultureand sensitizing
createclin a partnershipenvironmentbv by 2010'
t:d t:iT*ities' Development objectives:
publicto eclucational organizations
fbr
eclucatior.r expenditures ivill be raisecl to 4.9o/oofGDP; by 2010,regularexpendittlres
a propclrtion of pubiic expenditure
qualitv edr"rcation, salariesexcluded,will increaseas
from the current rateof 9.60/0 to l3o/oof total pubiic spending
for pre-tertiary education
tirr edr"rcation.
own revettues' TheUniversityof Zagreb
Highereducationinstitutionsalsoearntheir
to illustratethe ratio betrveenbudgetand ou't.t-
and Ftrcultyof E.orro-y in Zugr.Utill ,.rve
7070of the in'linistry's budgetearmarked
sourcerevenues.Theuniversi,vof Zagrebreceives Croatia
workforce at uni'ersities throughout
fbr all its universities,anJit employs7d%of all of
-
27.5voand state funding lor 72.5%of the total br'rdget
orvn-sourcerevenues u..nu,-,, f<-tr
betrveenindividual faculties/constituent
thc university of zagreb.Thedistributiondiffers
partsoftheUniversity.Accordingtosomeresearch(Bajo'p'120'123)thelargestallocation
'ou*
of Natural Sciencesand Nlathen-ratics
gir=n to the Facultyof Nlediline (102o),Faculty
(8%)' Facultyof NlechanicalEngineering
(sligiltl,vlessthan l0%j, Facultyof Philosophy
(57o) and \reterinaryFaculty'
and NavalArchitecture(6%),Facultyof Agronomy
Forexarnple,duringaperiodoftime50o/oofailbudgetaryfundsl'vereallocated
onlt'to 6 thculties'
some facultiesearn 5070or nlore
As far as own-sourcerevenuesare concerned,
- Facultyof Economy (60?o),Facult,vof
of their total budget through their own revenues (47olo)'
of Lar'v(50%)and Facuitl'of Kinesiolog,v Some
TralficEngineering(57%),"Faculty
Most of orvn-source levenues colne
faculties*r. u, little as l% of their own revenues. (47o/o),
and professionalactivities
frorn scientific and educationalactivities,publishing
studies fees (99%), hiring of facilitiesirncl
undergraduatetuitions (32.60/0),postgraduate
expenditures arerelatedto the
equipment(2.7vo)donations(t.iv").The most important
perfbrrnanceof the aboveactivities'
revenuesaccordingto legal
Higher eclucationinstitutionsmust use their own
regulations.Thevare,inthefirstplace,regulationsonbasic6r-rancingofhighereduca
on criteria and rval'sof using orvn-
at public higher educationinstituiionsand regulations
pubiic researchins-titutes' Depending
sourcerevenuesat highereducationinstitutionsand
(tuition fees'scientificand professional
on tl-reactivity which is the sourceof orvnrevenues
from 107o-609/o must
projects,hiring of facilities, a
clor.rations) Percentageof revenues
This also relates the
to
be eirrmarkedfor the i-p.o,r.^.ttt of the educationalactivities'
However,irregularitieshave
acquisitionof equipmentandiiteratureaswell asinvestments'
(Bajo,p. 123-125).Interms
beerrspotteda, iegardso*n-sourcerevenuesand expenditures
and postgraduatestudies'
of reyenue,there are problernsrelatedto feesfor professiolal
regarding the distribution oforvn-source revenues'and
Facultiesdo uot observeregulations
150
 (ovacevii B.:Financing
2.,Sisek
60D.| (2007)
ZAGREB,
|ZVRSN05T
P05L0VNA BRI

there are irregularities with the hiring of facilities and bank deposits of unspent budgetarl
allocatiols. In terms of expenditure, there are problems witli pavroll irr.rdits level, violatiorl
of regulations regarding public procurement, capital investnle nts etc.

Table 2: Total revenuesofthe FacultyofEconomics,Zagrctr,(structurein 96)

Description 2000 2001 )002 2003 2004 2005

allocation
1.Budget 43,1 40,0 18,8 )1,9 J1,7 30,5

revenues
2.Own 56,3 60,0 61,2 68,1 68,3 69,5

3.Totalrevenues 100,0 100,0 100,0 100,0 100,0 100,0

Libraryofrecords,
Source: fune2006
FacultyofEconomv,

Here we presentthe strr.rctureof revenuesand expensesaccordingto the main

points.

III. - BASIC SOURCES(RESOURCES)AND CASH FLOWSIN PERIOD FRONI

2000TILL 2004

A. REVENUES
I. BUDGET OF REPUBI,ICCROAI'IA
l. Resourcesfor grosssalarieswith contributionsand remunerations
2. Expensesfor ordinarv activities
3. Expensesfor capitalinvestments

II. OWN INCOME RESOURCES

l. Incomefrom ordinarv activities
2. Donations/ liquid and capitalinvestments
'Iiansfers
3. with other f-aculties/schools
4. Incomesfrom sold aPartments
5. Incomesfrom creditsfor activity developments

EXPENSES

I. ORDINARY/LIQUID EXPENSES
I . Expensesfor grosssrtlaries
2. Ordinaryand extraorclinary businessexpenses
3. Studentsinsurances

II. CAPITAL EXPENSES

1.Licenceand usagerights
2. Equipmentby the structureallotment
3. Literaturefor library and Postgraduatestudies
4. Informaticsprograms
5. E,xtrainvestmentsin buildings

t5l
 2.,5isekB.:Financlng
Kovaievic
GOD.
ZAGRIB,
IIVRsNO5T
P05LOVNA I (2007)
BR'1

of their linancing (9'o)in 200-1

Table 3: Facultyof Economicsexpendituresarndstructure

in2004
Finances
expenditure
Total
Des(ription {%o) 0wnresources
B u d g eatl l o c a t i o n

70,4 41,3 58,1

andcontributions
l. Salaries
I 5,6 11,6 86,4
costs
2.Running
0,s \ t. 7 82,3
standard
l. Student
13,5 2,4 91,6
4.Investments
expenditure
5.Total 100,0 31,1 68,3
(1+2+3+4)
Facultyof EconomyZagreb
Source:Library o.fRecords'

oftheir llnancing(9o)in 2005

Table 4: FacultyofEconomicsexpenditureand structure

5.Totalexpenditure
(1+2+3+4)

Facultyof EconomyZagreb
Library LtfRecords,
S<rurce:

'Ihbles orientationof the Facultvof Economicsto earnits orvtr

indicateever-presel.rt
statereduction
revenues.This approachruu, initiut.d in mid 90s not only becauseof the
(ir.rrelativet..-ri of budgetallocationsfor higher education but also because the Faculty
o\vn re\renues and budget
decideclto open itself torirardsthe market. The ratio between
in2004and 69,5:30,5 (in 2005)is the best illustration of the shift
allocationof 687ovs.32o/o
86% of running
torvardsthe rnarket.The fact that the Facultycovers59% of salarycosts'
costsand 9g7oof investmentsspeaksin itselfabout financialindeper.rdence of the Facultl'.
per student and
Horveverthere are problemsin calculatingthe real price of eciucation
calculatingrealcostper studentrespectingthe necessarystandardsto perftrrm educational
'fhis
programme. is bestillustratedin Table5'

t52
p05LOvNA G0D.
ZACREB,
rz\/R5N0ST BR.1
| {2007) Kovaievic B.rFinanc
1.,5isek ng

Table 5: Studentsenrolleclin trcademic,vears200'1/2005(all vears)

(allbutdegree)
Undergraduates Iotal

Financial Financial
lnterna- lnterna
supp0rt Regular Extramural support Regular [xstram
ural
tt0nal Total tional Total
fromthe students students fromthe 5tudent student
students student
l,4ininry Ministry

334 405 0 632 1371 1766 t256 7 1001 8030

65 t0 0 t3 8B 281 30 0 ia
156

28 42 0 136 )06 65 119 0 419 603

0 0 0 t6 16 0 0 0 9i 91

0 0 0 0 0 155 40) 1 1837 2383

0 0 0 t4t 141 0 0 0 t4t 141

0 0

0 0

0 0

421 451 0 918 I822 2267 lB07 8 5514 11616

FacultyofEconornicsin Zagreb
Library oJ Records,
Scrurce:

Out of the total of 11,616studentsonly 2,267are excnlpt tionr the tuition fee
("snpportedbythe Ministry") while the remaining9,649pav tuitiorlt'ees. Thereare3'815
of regularstudents,and they pay the tuition feeof 685 euros,\\rhile5,534areextramtlral
studentsand pay the tuition feeof 4ll euros.It shouldbe noted that the N'lir.ristn'sets
tuition feesand facultieshaveno sti)rover it. It is clearthat tr-ritiont'eeslag behind services
that studelts receiveduring the schoolyear,as far asthe regularstucientsrvhoareexemPt
from the tuitiol fee are concerned.If we divide the total funds allocatedto the Faculty
(around5.4 million eurosin 2004)bv the number of thosestudents(2,267)the costof
studyingper regularstudentturns out tobe2.362 eurosa year.That is a far nore realistic
costofedllcationper student,but it needsto be reiterated that Facultvsbudgetallocation
must coversalariesand contributions, running costs, student standardand investtnent.
Facultiesarein dill'erenteconomicsituationsassorne of thent eartrotrlr' 1%and some60(l/o
of orvn-source revenues. circumstances
Under tl-rese there rvill be difterent attitudestorvarcis
the irnplen.rentation in
of reforrns,organisationalcriteria and finalrcing accordance'witir
the BolognaDeclaration.DifFerer.rt facultieswill fight for lurnp sums.N{anvfacultieshavea
high leveloffinancial independence, and rvith uncertaintyanticipatetheir firturefinancial
star-rdingand their role in general.Nanrely,the questionthat en-rerges is horvto colnpensate
faculties'acquiredrights when the right to be a legal entiti' gets abolished.

In any case,our analysisof higher educationl.rnancingshou'sthat :ill institutional

shortcomilgs of the educationalsector(analysedin chapter2) u'ill beconlee\rengreater

153
 B.:Financing
1.,Sisek
Kovacevit
GOD,
ZAGREB,
IZVR5NOST
POSTOVNA I (2007)
BR.1

rvith EU'seducationalsysterl has

under the existingsystemof financing.Harmonisation
of ilstitutio's
and cleterminationof reallinancialstar.rdir-rg
linalll,leadto prof .i e,ralrration
anclprogrammesof higher educatitlt.l'

4. CONCLUSION
problemsput pressure
croatia is a transitionalcountr,vrvhoseeconomicand social
higher than rvhat can realisticalll' be provicled'A
on buclgetdemandsthat are usually
policy is more orientated towards irnport and trade thal to export
current"econornic
educated rvo_rkfbrce; hence,the
and production. There is ,ro req,.rirementfor a highl,v
for higher educationis treatedas a budgetary burclen' Other shortcomings
exper-rcliture
corne into the pictureas well: the absenceof a cleareconomicand socialdevelopment
education;the
strateg,v;growth ratesare still too low to proviclefunds fbr qualitYhigher
le'els (primary' secclndarl"
.br.,ri" oiun adequatedevelopmentstrategyfor all educatio'al
a high leYel of centralisation,
tertiar,v).The presentmodel of financingis characterizedby
respectiveinstitutio's rather
and the Minisiry of Science,Educationand Sportslinances
s,Ystem resultingfrom
than their educationalprogrammes.Thereis no quality assurance
universities'self-assessmen] supervisionof the qualitr'.Hence,the financingof
and extert.ral
studentand the quaiitv
higher eclucationinstitutionsis not clependenton the realcostspcr
As the result, the funds that are thetnselves scarceare used
of educationalprogrammes.
We may aswell acldthat the use of own resources is marked by irreguiarities
irresponsibly.
Hence the {inancing of higiler education institutions
und .i.i.-.t.pping of legalregulatiorrs.
education sector' Our ar.ralysis of higher education
is the cruciaip.obl.* of tlie rvhole
shortcomings of the educational sector rvill become
financingshowsthat all institutional
evengreaterunder the existingsystem of linancing'

REFERENCES:
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IZVRSNOSI
PO5IOVNA I (2007)
GOD. BR.1

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FINANCIRANJE VISOKO G OBRAZOVANJA U

REPUBLICI HRVATSKOJ

Zoran Kovaievii3 &. Boris Sisek'

Saietak
osnot'niizvor gosPotlttrskograzt'oja"la tinjenit:a
LIdanainjemsvijetuznanjeje postnlo
sustava visokog obrttzttt'ttnja u svakom modernom
tftjeiena potrebi utinkovitogdjekn,anja
poloioj
tlruitvu. Llsporedba Hrvatskis istalint OECDi EU zemljamttclajentundodatniuvid u
tranzicijskom procesLt' Ot'aj rad u srediite stavljo
i ulogu uisikogobrazovanjau hrt,tttskont
u Hrvatskoj, teobjalniota odnosinnedufnanciranjo
sustivJinancilanlavisokogobrozovanja
toga,zanitnajunaskriteri.ii
iz proraiuna te itastitihpiihodo visoioikolskihirtstitucijtt.Osirn
vlastitih prihodn, te kurokteristike prikazivania
zi ,lo,l1rlu,rrdstavaizproratuna,pribavljanje
sveuiiliita. poclaci dobive'ni iz analizesmo s
usporedilipo2elinom ulogomJtnanciranjtt
rashorJa
v i sokolk oIskih inst itucija u p r ovedbi r efor me v isokog obr azottttt t-itt'
Kljutnerijeii: yisokoobrazovanje, sveuiiliite,fnanciranJe, linLlnciranjeizproraiuna,
vlastitiprihodi.

rDr. sc.Zoran Kovaievii, Izvanredniprot-esor'Lkonomski fakultet'Zagreb'! nrril: zoran.kovacgl,ic@gtig.h r

tI)r. sc.Boris Sisek,lzt'anredniprofesor'Fkonornskifakultet'Zagreb'E rlail b o r i s .s i s e k ( r e f z g . h r

l5-5