The education system of the Republic of Croatia comprises four levels: early childhood education and care, primary, secondary and higher education. The Croatian education system is supervised by the Ministry of Science, Education and sports (MSES), as well as other national bodies responsible for the development of the education system. The activity of secondary education is carried out in accordance with the Act on Education in primary and secondary school. Given that education generates human capital which has a major impact on the entire economy, adequate investment in the education system is very important. Secondary education in Croatia is financed primarily from the state budget, county budgets and the budget of the City of Zagreb. In doing so, the primary duty of county budgets is to open and maintain school institutions while the duty of state budgets is to finance salaries, capital stakes and to provide facilities for cities and counties to finance breaks. In other EU member States, the way in which the education system is financed is similar to that in Croatia. Secondary education is mainly financed and controlled by the regional government. In the EU countries, expenditure on education is the fourth most important component of public expenditure, in addition to health, social protection and general public services. They account for 10.2% of total general government expenditure and 4.6% of GDP. Unlike EU countries, in Croatia the share of expenditures for secondary education in total general government expenditures is about 20%, while the share of GDP is only 1%. Differences between Croatia and other countries are also reflected in the fact that most of these countries express social policies that play an important role in providing funding for students, as highlighted most in the system of scholarships, voucher financing and lending. It is precisely these ways of financing that can have many positive effects on the entire education system, which continues to spill over to the country's economy. Although the sources of funding in the EU vary from country to country, they are mainly tax-related in all these countries, and other sources of funding such as subsidies, grants from parents and economic organisations may also emerge depending on the type of school and economic. Although the situation in Croatia has improved significantly in recent years, there is still a significant number of empirical research that has shown that funding education in Croatia at all levels is inefficient. The results of various studies have shown that Croatian students have relatively poor results on standardized tests, which also indicates inefficiency of the educational system. Croatia tops the EU rankings according to the indicator of youth unemployment and education.