Palkovics: industry-oriented higher education not a dream any more

AP: According to one of the most important messages of the government for the year 2015, the transformation of higher education has been finished, indicating the passage of an old and the beginning of a new era. Please, elaborate on this statement.

László Palkovics: In the last 25 years, Hungary's higher educational system has continuously evolved. This process has to come to an end in terms that we cannot keep carrying out systematic transformations all the time.

As the name of our strategy, "Changing gears in higher education", suggests, we do not need drastic reforms but changes that provide sustainability. We assessed how the structure of local higher education was in comparison with neighbouring countries, and we found no substantial differences compared to the frameworks of other Central European states.

Of course, there are differences in the details but all significant structural changes – the adoption of the Bologna Process and introduction of a two-level degree structure, adapting education and research to market demands – have been successfully implemented. We have yet to establish an institutional background necessary to accomplish the aforementioned targets, which entails discussion regarding the transformation of existing universities that are – in spite of the reaction of the press – not at all significant.

Thus, these transformation processes will be completed, and we must start executing tasks that ensure that the system is sustainable in the long run. The annex of the higher educational strategy includes a wide range of such tasks: we must examine carefully the transformation of the financing structure, amend doctorate programmes and basic research and we would also like to reduce the number of drop-outs.

László Palkovics, Secretary of State responsible for higher education

AP: One of the key terms of the strategy you have mentioned is sustainability. What is meant by this often-used term when it comes to higher education?

LP: First of all, to have students who also complete their studies. For the first time in many years, this higher educational strategy drafted a quota in terms of how many degree holders Hungary needs to be able to maintain its society and economy. Of course, as technologies are constantly changing, this figure has to be flexible, so it is possible that later on there will be a need for more skilled labourers or engineers.

AP: Our readers should not expect concrete figures, then.

LP: Instead of an exact number, we indicated a ratio. Our idea was that as the Hungarian society is part of a world that surrounds it, and taking into consideration the changes of the outside world, the proportion of degree holders should be near 30–35% of the entire population. Currently, this ratio is approximately 18% of the entire population and 22% of the working-age population, while according to a survey by the European Union's OECD, 34.1% of people in the age group of 30 to 34 years have a degree.

The EU target is 40%, while Hungary is targeting 35% by 2020, which means our prospects are very good in terms of accomplishing our goal. This index is even lower in Germany, even though they originally set a higher target. We may ask the question: if out of every 100,000 people, we want 35,000 to be a degree holder, how many students will need to be enrolled? 50,000, according to the latest data. However, demographic data shows that approximately 90,000 children are born every year. But if the majority go to university, are the rest able fulfil the necessary social and economic tasks? Ideally, we should eliminate early school-leaving so it would be enough to enrol 35,000 students in bachelor courses. The reality is somewhere in the middle.

By all means we would like to support university students whose application has been accepted in completing their studies and minimize drop-out rates. Never before had anything like that been written down and now we have done so. In time, we will have to assess whether the target can be met, but at least we have a quantified plan to start with. We must mention here the presence of international students in Hungarian higher education. Currently, there are 25,000 international students in Hungarian institutes, and we are looking to double this number in the short run. Adult training is another area where there is room for improvement. In that respect, Hungary is lagging behind. For this we need an infrastructure, educators and researchers – these all form part of the sustainability. We have a lot do.

AP: Let's move on to the so-called "industry-friendliness", the next target Hungarian higher education has set for itself. The necessity of collaboration and finding its pace is becoming more and more pronounced and placed increasingly firmly on the agenda of the industry's communication towards higher education. With what concrete measures do you respond to the requirements of the corporate sector?

LP: The government formed in 2010 already understood that we cannot ignore the needs of the industry. It doesn't matter if some say that we should have people with degrees in technical management and international studies with general knowledge, who will then fill in certain positions and learn there the know-how required for the job, when this way of thinking does not fit the country's economic structure. If we need mechanical engineers, we have to train mechanical engineers, because the same task cannot be performed by an industrial product designer or a technical manager the same way. We do not take into consideration the current requirements of the industry, as we cannot supply tomorrow what companies of a certain segment need today: there is a lead time of at least 3 to 5 years.

Although it entails a complex planning process, "industry-friendliness" means that we must train professionals who are able to meet industry requirements as soon as possible, in the short term. In 2010, it was revealed that we need a massive supply of professionals in engineering, IT, natural sciences and pedagogy. This year, 40% of students whose application has been accepted will start their studies in these fields. There is a tangible progress, then, in terms of adapting to the needs of the industry, although this is not only up to us – there is certainly a way to progressing even quicker. However, what the government wants is only one element of whether young people decide to shift their focus to technical fields. In a few years, we have achieved a 12% improvement, a perceivable result, but we also need corporations to participate.

There has been a clear shift in the industry, one of the signs of which was the start of the dual educational programme. The fundamental intention is to have more and better-trained professionals in the shortest possible period of time. Dual education is not a unique albeit pronounced part of an industry-friendly higher education, in which not only are companies ready for popularizing themselves but also to take action, receive students and support universities for a more efficient collaboration. In September 2015, these trainings will begin with legal support with a number of students nearing a thousand.

AP: What is the role of the newly-formed Dual Training Committee in all this?

LP: While in the case of universities the launch of the dual educational programme will bring only a few changes, corporations will have to carry out rather a lot alterations to be able to adapt to the new system, as companies are not training centres. For conducting corporate management tasks we have asked professionals from the industry and higher education capable of assessing the viability of dual education in certain fields, and in addition to system development they also undertake accreditation tasks. Thus, it is up to their assessment whether a corporation is capable of joining the dual educational programme.

AP: Staying at the relationship between higher education and industry: what is the government's response to the criticism that although the auto industry is without a question a dominant force in the country, the lack of diversification could become a weakness in the future?

I suggest to those who say that Hungary is becoming a large assembly plant or that we are making ourselves vulnerable to look around in the world and see the auto industry's position in Europe, America and what the automotive industry means on the whole. Not only does this sector include car manufacturers but also their suppliers. However, these companies are not only suppliers to the auto industry.

The criticism mentioned in your question points to a lack of understanding of the industry, as I, for example, have not seen a country that became wound up in a difficult situation because it had had an excessively powerful automotive industry. I would like to add, though, that there are additional, similarly serious industries in Hungary. For example, if we took it seriously that we are an agricultural nation, we should not forget about this area either.

Just as representatives of the automotive industry often knock on our door and indicate what they expect from higher education – this does not only include technical but also legal, HR and economic positions and related educational programmes –, I would also be glad to see the agricultural sector doing the same and point out what they need from education. Instead of making less-than-reasonable statements, we should emphasize and consider the position of all industrial sectors.

AP: Is the country, then, not becoming and assembly plant?

Recently, I have also heard that allusion in Parliament that the government intends to turn Hungary into an assembly shop. Even though in this form this statement makes absolutely no sense, let's look at what kind of activities are performed in a typical Hungarian vehicle plant, and how an OEM such as this integrates into its environment.

A company of this nature employs semi-skilled labourers on the assembly line who have no qualifications but are trained to perform certain tasks. Its social impact is rather clear, as it decreases unemployment. It also employs skilled labourers who are qualified to operate existing technologies. Economists, logisticians, engineers also take part in the production process, who further develop the technologies and design an optimal flow of materials. We are still only at the level of manufacturing and yet we have covered much more than simple assembly. As automotive products are becoming increasingly complex, the level of qualification rises among blue-collar workers, too. Manufacturing firms are making considerable efforts to keep developing their domestic and Central Eastern European suppliers.

In procurement, an area which also includes supplier development, they also employ a whole range of engineers, logisticians and other professionals. At large businesses the development of human resources emerges, where they employ psychologists and educationalists. Although starting from the end of the last millennium, many foreign companies came to Hungary for its cheap labour force, today these firms have transformed and now they also engage in product development. Among suppliers I could mention the example of Bosch, a company that after Germany boasts its largest development operation in Hungary, placing us ahead of the U.S. or even China.

Thus, innovation activities have appeared, through which these corporations do not only exist on their own but along with their environments. From a product development point of view, Győr-based Audi Hungaria requires close ties with the local university, and this relationship works in both ways, as the German auto maker has even established its own faculty in Győr. There is also a Nemak Faculty and a Bosch Faculty in the country. These relationships render the debate about whether Hungary is becoming an assembly plant meaningless.

AP: Now that you've brought up the strengthening of development activities, higher educational institutes have a lot to do in that department.

LP: This is absolutely true. We have already talked about the relationship between industry and higher education – this relationship is extremely diverse, it is not restricted to training only. Some of the companies require research, development and innovation services, and they would like to purchase it somewhere. We have included this in our higher educational strategy and we also passed a law which enables us to promote such collaborations between universities and the industry. We must understand that sometimes the industry wants something that higher educational institutes do not yet understand – corporations are not necessarily in need of what a given university currently has to offer.

There is a dynamic in this relationship, and the government's aim is to lend a helping hand in that area as well. Instead of a rather unrealistic, centralized public procurement procedure, institutions will have the freedom of an entrepreneur. Centres for higher education and industrial cooperation will appear, through which universities will be able to procure the equipment necessary for corporate partnerships using public resources.

AP: After the organizational framework let's talk about the students. In addition to demographic effects, young people are now more open to mobility. An increasing proportion of the young generation considers it an option to enrol in foreign universities.

LP: I don't think this is a problem. There are of course several statistics but according to the latest survey by the research institute of the Hungarian Chamber of Industry and Commerce, only 5% of 700 students from the best secondary schools are considering studying abroad. I don't see this as worrying at all. Our task is to make sure that those who study abroad will eventually return home to work here. We have a wide range of plans to achieve this, but we are also working on allowing certain disciplines of ELTE to appear as a viable alternative to some of the courses at the University of London.

If the student only wants to go abroad because life is easier there, we must be able to offer an alternative, and I'm certain that we will achieve that. However, if students apply to a course abroad because they need the qualification that is offered there, why would we want to prevent them from doing so? Our task is to offer master's degrees which students can take after completing a bachelor's degree abroad. The situation is far from being drastic, even so certain voices do exaggerate the amount of students longing to go abroad.

According to data from the OECD, currently 2–2.5% of students in higher education study abroad, the same amount as two decades ago. In Germany this figure is 7–8%, which doesn't mean the German economy is not offering viable prospects or that the German higher educational system is bad. Mobility does exist, we have to live with that. What is more, only 10% of Hungarians study in a post-secondary course abroad, which is extremely low. I simply do not understand, when we were in university, we couldn't wait to study a semester in another country. Besides the intention and language barriers, these travels were hindered by other technical difficulties, which we were able to terminate this autumn.

AP: Finally, let's look at Hungary's higher educational map. Initially we spoke about the beginning of a new era, and a similar event is expected also in the transformation of the institutional and training structure. An engineering course has been launched in Szombathely, as a hub of automotive manufacturing Kecskemét could receive a university, a dual educational programme is about to begin in Miskolc, Székesfehérvár is also consolidating its engineer training programme. What is the fundamental principle of these transformations? Is it not a disadvantage to launch similar courses in too many places?

LP: If we want to meet the requirements of the industry, the economy, we need to meet them where the industry is present. The reason for establishing a mechanical engineering programme in Szombathely is not because Győr or Budapest would not be able to train capable professionals. If a student from Szombathely goes to study in Budapest, there is a huge possibility that he or she will not return to work in Szombathely. We must not underestimate the effect of networking that occurs during their studies. However, in the meantime we must assess the issue of cost effectiveness and the aspects of quality.

Regarding Szombathely, we can see that it is advisable to launch a mechanical engineering programme in the town because local companies are taking a serious part in maintaining the system. It is true to both corporations and universities that they should be aware of what they are good at, and they should never lose focus. Both groups must perform activities that are in demand, their professionals are good at and the conditions are provided for. Good practices in that regard are shown by Széchenyi István University of Győr and Kecskemét College. Not only do the automotive manufacturing plants in their vicinity support them financially but they also present a continued demand, which provides steady development in higher education as well.

Although it is not a training site for the automotive industry, I would also like to mention Eötvös József College in Baja. A few years ago, they were on the brink of bankruptcy, but with significant structural reforms they launched training programmes that were actually in demand. Although they did not turn into a large institution, they now offer valuable degrees. Here we can also mention Nyíregyháza, which has also started in that direction. In my view, the institutions have understood that they must change, as the world is also constantly changing.

Interviewer: István Gégény