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The Chancellor’s interview with the Napló

The University of Debrecen has balanced its books: its debt decreased by billions in 2015 - said the chancellor, Zoltan Bács, in his interview with the Hajdú-Bihar Napló.

Debrecen. The ministerial committee set up a year ago to investigate the activities of university chancelleries reported – among other things – that the management of the University of Debrecen has developed, mainly over the past year; in this period it has managed to reduce its debt and increase its revenue. Prior to his appointment Zoltan Bács worked for many years in the University of Debrecen as director general in charge of economic affairs, but whereas previously the rector was his direct superior, this time the prime minister appointed him to the post of chancellor on the recommendation of the minister of human resources.
The Chancellor’s interview with the Napló 
How is your current work different from what you did as Director-General?
Zoltán Bács: The Director-General was subordinate to the rector, while the chancellor plays a co-ordinated role at his side. The rector directs the educational and research aspects and the academic life of the university, and he is the university's primary leader. The chancellor is responsible for the management and operation of the institution. This double role forces them to cooperate in harmony, at least, this is the only way to achieve success. Note that I did not start my work with the rector at the chancellery from scratch, since I had been Director General of Economic Affairs for the preceding three years. So the opportunity was there for seamless integration, which has become a reality with the Rector. We are continuing our earlier work, with only a slightly different legal status. I do not feel that it alters significantly the daily operation of the university, however, it has brought a major change in my responsibilities, because everything that involves money and operational affairs is the chancellor's responsibility.
The University of Debrecen is in a good financial state. What is the key to this stability?
Zoltán Bács: The economic indicators were good in previous years, perhaps they’re even better now. However, while elsewhere university faculties operate within the framework of the so-called cross-subsidies, so that the resources of the stronger are passed on to their weaker partners and the accompanying arguments go on for months, we set our budget on a base level, and adjust it to the performance indicators. The truth is that over the last 15 years the financing of the university has not depended on any particular methodology, but on the state budget figures. During our operations we have to do the same year after year. So, if we have to accommodate to the methods which have developed in the interim, we change the internal numbers administratively, while the daily activities remained unchanged. From the year 2000 to 2013 the three major units at the university, namely the Medical Centre, the Agricultural Centre and the science and humanities faculties, received money. The centres decided what they would operate from, which would do what and to what extent and how they would contribute to the common interest. This period of historical development was necessary, otherwise we could not have created a workable balanced structure, which we will now carry over to the de facto unified university; but organised around other principles - the faculty structure and the three business areas (education, patient care, agricultural activity). Our common principle is that the university should be a functioning unit, and for that all activities are necessary. If financial support for the institution from the state does not fundamentally change, the amount of state funding for the various faculties cannot vary by more than 5 percent, regardless of their actual performance. This gives a certain stability, at least in the short term. The question of who can bring something extra from the market and how much, depends on the performance of the given unit. The opportunity is open to everyone in both education and research.
What are the expectations of the funding body?
Zoltán Bács: The key is that there is a much closer relationship between the Chancellor and the Department of Human Resources, than in the time of the Director-General. Led by the State Secretary László Palkovics, the State Secretariat for Higher Education is carrying out systematic work on the country’s higher education strategy, which also acts as a reference point for the institutions. The main expectations are to follow the strict requirements of the budget, to ensure the proper functioning of the institution, to comply with budgetary and procurement rules and to integrate new business strategic thinking. All this does not surprise me, because before it was also my job; together with colleagues we try to meet the very diverse requirements, which is not always easy. After all, the state universities, as budgetary bodies, are governed by official rules, but at the same time we should find our place in an environment of flexible international market competition and move up the international rankings. Around the world there are about 18,000 universities, and to be among the first 500 – in several rankings – is really something; but of course, we always want to improve our position.
How, and at what price did the University of Debrecen manage to reduce its 5 billion debt to half a billion?
Zoltán Bács: The university operates with a budget of approximately 90 billion. The 4.5 billion debt reduction is a large amount - about 5 percent of the budget. We streamlined the operating system of the university, indeed we have centralized everything as part of one systematic process. A significant proportion of the internal deficit was controlled through administrative measures. There were grant proposals which we financed previously but which received their [external] finance last year. We always plan a reserve in the budget. Basically, with stricter management we shaved off the deficit. I do not feel that they were large scale cuts, but rather rationalization, and there were no attendant jobs losses. Outside support was provided to cover deficits in medical care.
The full interview reveals what the Chancellor thinks the teachers and students might have felt about the transformation and his reaction to the prime minister’s statement that in the longer term the universities must be self-financing.