Hungary Minister for EU funds tries to "clarify" Erasmus issue with the EC

Navracsics has contacted Johannes Hahn, European Commissioner for Budget and Administrative Affairs, and Mariya Gabriel, European Commissioner for Innovation, Research, Culture, Education and Youth, to ask for more information on

what exactly their problems are and what solutions they propose for the Erasmus issue.

Let's help the minister, shall we?

On 15 December 2022, the Council has released its decision "on measures for the protection of the Union budget against breaches of the principles of the rule of law in Hungary." This document lists the problems with the public interest trusts and also proposes a solution to protect the EU budget, which - as a first step - is more like a penalty, e.g. the freezing of funds.

“[…] there are concerns regarding the non-application of public procurement and conflict of interest rules to ‘public interest trusts’ and the entities managed by them, and the lack of transparency with regard to the management of funds by those trusts.

“Hungary did not provide any evidence on the applicability (nor the application in practice) of conflict of interest rules relevant for the protection of the Union budget in relation to public interest trusts.

“The appropriate measures should also concern actions under Union programmes implemented under direct and indirect management, for which public interest trusts and the entities maintained by them, which are considered as government entities […], may be beneficiaries or implementing entities. As regards the identified breaches relevant to public interest trusts, all Union programmes implemented under direct and indirect management should be targeted by the appropriate measures.

“[…] the regulatory framework still does not prevent top-level officials, including senior political executives from the National Assembly and Hungary’s autonomous bodies, from sitting on boards of public interest asset management foundations, as repeatedly requested by the Commission.

“Moreover, Hungary has reintroduced as of 1November 2022 the possibility (by means of an exception from the general prohibition) for senior political executives to have other remunerated employment, including on boards of public interest asset management foundations.

“The Council considers that for these reasons as further set out in the Commission’s communication, the weaknesses of the regulatory framework combined with the new legislative developments aggravate the possible conflict of interest that the remedial measure was meant to address and therefore renders it inadequate to address the concerns originally raised by the Commission.

“Concerning the identified breaches in relation to public interest trusts, the regulatory framework in Hungary has weaknesses, as set out above, which have not remedied the risk of conflict of interest that the remedial measure was meant to address.

“In light of the inadequacy of the remedial measure, a serious risk for the Union budget remains and can best be addressed by a prohibition on entering into new legal commitments with any public interest trust and any entity maintained by them under any programme under direct or indirect management.

“Such a measure does not affect the overall allocations of funds from Union programmes under direct and indirect management which may still be used for other entities and is therefore sufficient to achieve the protection of the Union budget while being proportionate to what is strictly necessary to achieve that objective.”

As reported earlier by Portfolio, the rule of law case against Hungary has resulted in a ban on commitments of EU funds to higher education institutions managed by public interest asset management foundations. This also affects digitisation and research and development programmes in higher education planned with cohesion funds, Erasmus+ funds and Horizon Europe funds directly awarded in Brussels.

In the interview, Navracsics - who is also the chairman of the board of trustees of the Pannon University - said that it is not true that the boards of trustees have a manual override on the teaching and research work at universities, as the research activities of the institutions are independent of the operation of the boards of trustees.

The Minister said that in response to EU concerns, the government has amended the regulation on public interest foundations, bringing them under the Public Procurement Act, and imposing strict conflict of interest rules on trustees.

According to him, the EC has not indicated since then that it is not in favour of the correction.

On Wednesday, the National Conference of Student Unions issued a statement on the Erasmus+ programme, stressing that

higher education without Erasmus is "unimaginable".

As far as the HÖOK is aware, students who are currently on Erasmus or are preparing for Erasmus mobility this year will probably not be disadvantaged, but in order to ensure that this remains the case in 2024, the Hungarian government and the European Union must reach an agreement as soon as possible.

There is room for criticism regarding the change of model. The HÖOK has also made numerous proposals in recent years, but the debate on how to correct the mistakes should not be about student access to education or to certain services, such as exchange programmes,

the statement adds.

The HÖOK has contacted the leaders of the European Students' Union, which represents students at the European level, and will initiate discussions with the Delegation of the European Commission in Hungary.

Students' access to education and student services is an issue that transcends political positions, and all actors who can help must work to find a solution that is reassuring for students as soon as possible. We urge the decision-makers concerned to find a solution to this situation as soon as possible, before the spring application period starts

says the statement issued by the HÖOK's Press Officer Marcell Budai.

Cover photo: MTI/Zsolt Szigetváry