The article, based on policy analysis, institutional interviews and community fieldwork, looks at why children in prostitution and victims of trafficking remain practically without state support and institutional assistance. It also explores to what extent the decriminalisation of the system assisting child victims of prostitution and trafficking, or the shift from the ‘punishment’ to the ‘welfare model’, has taken place. The ethnic aspect of the problem is addressed as well given that the majority of victims are of Roma origin. While Hungary has ratified all important international conventions that oblige the country to protect child victims, neither its policies and legislation nor its institutions including child protection, law enforcement and the judiciary, seem to have adequate structural frameworks and institutional practices to attend to these children and prosecute offenders. Policy gaps, institutional procedures and practices are identified and it is concluded that the country is still much closer to the ‘punishment model’.