The chapter investigates and discusses the impact of the political and administrative recentralisation process that has been going on in Hungary since 2011 on local government and urban governance, which has reduced the autonomy of both local and subnational self-governments. This chapter was written to confront the Hungarian urban policy with the challenges related to the new urban paradigm and the special principles of sustainable urban development defined in the New Urban Agenda, which was approved by the United Nations. The critical analysis identifies the tools of the state designed to penetrate more and more into the autonomy of local authorities and the impacts of these. Ist shines a light on the difficulties of the implementation of local governance by using the example of a post-socialist country. The chapter focuses on the role of large- and medium-sized Hungarian cities in the design and implementation of urban policy, based on the findings of an in-depth qualitative research made with city leaders. Throughout this, the analytical framework of the research is provided by multi-level governance and horizontal and vertical branches of cooperation and coordination. The findings point out that the operation of the Hungarian local governmental system has become fragmented in regard to urban and economic development. There are hardly any institutionalised arenas for horizontal cooperation, and unfortunately this is true for the cooperation among the governmental tiers. According to the conclusions drawn from the research, there is a tension between both the characteristics of the unitary nation state’s institutional structure and its urban policy and the elements of the New Urban Agenda. In the unitary state, the chances for the implementation of multi-level governance can be limited.

The goal of the paper is to search for the state environmental conditions for an effective urban governance by the analysis of the Hungarian processes of the last six years. The survey is focused, on the one hand, on Hungarian towns considered as small and medium-sized towns by European scales; on the other hand, the conditions for the birth of co-operations between these towns and their regions, and among the different sectors are also emphasised. This is the viewpoint from which the paper tries to grab the content and tools of Hungarian urban policy, and the special features of this policy. It is also crucial in this respect how the reform programme of public administration influences governance chances of cities both as regards the location of tasks and the organisational system; and also how much the cohesion policy of the EU and its urban dimension affects the public policy processes.