For the purpose of ensuring an efficient system of funding higher education establishments favourable for developing and improving the standard of life of students, with special regard to the social dimension of studying, in addition to the traditional method of funding, which relies primarily on public funding from the state budget, in 2008 the idea of financing the higher education system based on programme contracts started to develop when the Ministry began concluding contracts with public higher education establishments for the purpose of subsidising tuition fees for full-time students under a special Decision of the Government of the Republic of Croatia.
In 2010 and 2011, in cooperation with the World Bank and public universities, the Ministry started to develop the concept of programme contracts, and in 2012, in agreement with the Ministry of Finance, the Ministry established financial requirements for signing three-year agreements with higher education establishments for fully subsidising the costs of carrying out regular study programmes. The intention was to define financial resources and development objectives of public higher education establishments and to establish indicators for monitoring their activity.
On 17 May 2012 the Government of the Republic of Croatia adopted a Decision on subsidising tuition fees for full-time first-year students at public higher education establishments in the Republic of Croatia in academic year 2012/2013. On 2 August 2012, the Government adopted a Decision on fully subsidising tuition fees for full-time students at public higher education establishments in the Republic of Croatia for academic years 2012/2013, 2013/2014 and 2014/2015. On 23 July 2015, it adopted a Decision on establishing funds to fully subsidise tuition fees for full-time students and co-finance material costs incurred by public higher education establishments in the Republic of Croatia in academic years 2015/2016 -2017/2018.
The adoption of these decisions created the basis for the beginning of negotiations aimed at concluding individual financing agreements (so-called ‘pilot programme contracts’).
A new Decision of the Government of the Republic of Croatia on programme funding for public higher education establishments in the Republic of Croatia in academic years 2018/2019 - 2021/2022 (Narodne novine No 87/2018.) established a four-year scheme and resources for programme funding for public higher education establishments with the necessary resources to co-finance the material costs of teaching, scientific and artistic activities of public universities, as well as the teaching activities of polytechnics and colleges of higher education in the Republic of Croatia. The programme funding for teaching, scientific and artistic activities shall consist of basic funding and performance-based funding.