Abstract
This article is targeted at university managers and people involved in the field of university (de)regulation. The focus is on autonomy for state-funded universities (hereinafter simply called ‘universities’) and their financial steering through performance agreements and global budgets, bearing in mind the fact that contract management and multi-year global budgets have been playing a key role as instruments of university funding and control for 10 years now. After so many years of testing and experience, the time has come to assess the current situation and the sustainability of these developments. In particular, this paper examines the long-term potential of economic thinking and the use of business management tools for and at universities in comparison with political rationality in this field.
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Notes
- 1.
An assessment of such a complex subject as the development of financial autonomy in a changing legal framework and in practice is needed, and the universities deserve to have their—sometimes contradictory and sometimes mutually complementary—steering mechanisms made the object of scientific review and explicit evaluation. This paper was written in August 2009. There were no relevant changes of the framework until publication.
- 2.
Berka (2007):2, on the logic of the autonomous university: “Autonomy can never be an end in itself; the power of self-government is given to an institution to enable it to reach the set goals to the best possible extent.”
- 3.
For the relevant legal texts and ordinances, cf. “Universitätsrecht 2009”.
- 4.
Autonomy at the level of personnel, for example, is defined in the relevant employment laws for civil servants, limited-term contract staff and salaried staffs, and also—for the latter—in a collective bargaining agreement that was not signed until 2009 after a long process of negotiation and review with regard to the available finance. In the case of their study programmes, the universities enjoy autonomy with regard to content, but autonomy does not extend to the question of university admission or the amount of student fees, nor did it include the length of the Bachelor programmes until URÄG (2009) came into force.
- 5.
Cf. Footnote 32 to the 2007–2010 performance agreement. In the preparations for the 2010–2012 performance agreement, the Ministry went to the opposite extreme, providing the universities with highly detailed specifications for their drafts. As explained below, however, Austria still lacks an overall university policy concept in which such requirements could be embedded.
- 6.
This regime is often underestimated: Any quantitative, structural or price changes which have been incurred in the meantime, i.e. since 31 December 2003, and relate to personnel that was not employed by the universities at the cut-off date must be financed by the universities themselves. The effect of this rule is becoming increasingly burdensome as the (semi-)autonomous universities are confronted with a growing workload (resulting from higher student numbers and improved staffing ratios as well as the implementation of UG 2002 and URÄG (2009)) and the need for better qualified administrative personnel. The fact that new professors now sign private-sector employment contracts with the universities instead of receiving civil servant status from the federal authority makes them much more expensive for the universities, also because of their pensions, which now have to be agreed with the universities, too.
- 7.
University funding in Austria can be broken down as follows (figures for total spending in 2007): 77 % global budget, 9 % other income and reimbursements, 7 % research and artistic work, 6 % student fees and 1 % artistic training (BMWF 2008:74). Part of the funding for research work and related reimbursements is ultimately paid by the federal authority, too, while student fees are subject to political decision-making. It can therefore be said that, on average, well over 90 % of the university budgets derives from the federal budget and legislative decisions at the federal level.
- 8.
Unlike the universities, the Ministry was aware of the outcome of the formula budget when financial resources were being allocated on the basis of the performance agreement and obviously ensured that this promise was kept.
- 9.
A maximum reduction of approx. 12 % per performance agreement period and university applies.
- 10.
What these special funding requirements are meant to be is not specified in the law. It merely includes one example, which offers great freedom of interpretation and hence scope for interference on the part of the Ministry: ‘for certain projects for the creation or support of a national university space’. In the notes on Art. 12 paras. 3–5 and Art. 12 paras. 12 and 13 of URÄG (2009), a number of uses are listed “for the targeted improvement of the current situation of the universities”.
- 11.
Cf. examples of comparable universities outside of Austria and the repeated statements made on the subject and evidence provided by the Austrian Science Board and Universities Austria.
- 12.
Savings can be made, for example, by postponing appointments or procurement and capital spending items, and through the unexpected departure of personnel. Such options can hardly be expected to improve the quality of a university’s offering and are in any case neutralised by additional expenditures relating, for example, to increasing student numbers, price increases and rising costs, additional research projects without adequate overhead financing, and new and additional requirements imposed by the Ministry (e.g. legislative changes, annual special funding requirements).
- 13.
Recent examples: “Research Infrastructure IV” and “Anticipatory Chairs 2007/08”.
- 14.
The Austrian Science Board (2007):6, makes the point very clear: ‘Only if the universities have a secure financial basis that permits them to properly fulfill their normal functions in research, teaching and the training of the next generation of scholars can it make sense to embark on a competitive process such as the performance agreements are meant to initiate.’
- 15.
Cf. special section of the notes on URÄG (2009), no. 8 (Art. 12 paras. 12 and 13).
- 16.
General provisions for the performance agreements are to be found in Art. 13 UG 2002 and URÄG (2009).
- 17.
Pursuant to URÄG (2009) the University Council approves not only the draft of the performance agreement but also that of the annual special funding requirement. The University Council also has the right to issue an opinion on the performance agreement before it is finalised by the Reactor but not on the special funding requirement.
- 18.
‘Far too often the impression cannot be avoided that the universities merely compiled the wishes of the various university units (e.g. departments and faculties).” What was intended as a sustainable focus-setting and profile-building exercise is revealed as a mixture of more-of-same and wishes for the future’ (Austrian Science Board 2007:4).
- 19.
- 20.
According to the report, the Ministry’s priorities for university funding were the innovative developments already launched, reorganization projects and the priorities listed in the development plans, improved staff-student ratios, implementation of the Bologna Declaration, support for young scientists, and an increase in the number of chairs awarded to women (BMWF 2008:79).
- 21.
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Gantner, M. (2012). Universities Between Politics and Economics: Autonomy, Performance Agreements and Global Budgets at Austrian Universities. In: Altmann, A., Ebersberger, B. (eds) Universities in Change. Innovation, Technology, and Knowledge Management. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-4590-6_6
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