Part I — Situation overview

On Sunday, 4 October 2026, Dávid Vitézy, Minister of Transport and Investment, announced on social media that the Budapest Public Development Council (FKT) had decided to restart the investment in the Budapest Diákváros (Student City). The FKT is a joint consultative and advisory body of the government and the capital. Preparing the development has become the task of the Ministry of Transport and Investment, and the state will coordinate the investment jointly with the capital and District IX. According to 24.hu’s report, the minister added that this will happen regardless of any other disputes (24.hu, HVG, Népszava). The basis is the winning design of the earlier international design competition, which was launched by the Budapest Development Centre, then headed by Vitézy. The project is linked to the government’s Wekerle Housing Construction Programme, and EU funds will also be drawn in. The goal is a mixed residential and student-hostel district along the Soroksár branch of the Danube, to ease the Budapest housing crisis. The site is free because, under a law adopted by Parliament, the non-higher-education public-interest asset-management foundations (KEKVAs) have ceased to exist. These were foundations to which the previous government had transferred state assets and public tasks. According to Népszava’s summary, the foundation preparing the Hungarian campus of Fudan University (from 2025 the Tudás-Tér Foundation) received HUF 600 million in capital, HUF 6 billion in development funds and a 17.8-hectare property portfolio recorded at almost HUF 13 billion in 2021. The foundation ceased to exist in August.

On the same day, András Tombor, founder of the Mathias Corvinus Collegium (MCC), announced in a statement that he is seeking redress before Hungarian and European courts. The foundation operating MCC ceased to exist on 31 July 2026, by decision of the Prime Minister’s Office acting on behalf of the state, which exercises the founder’s rights (Telex). According to Tombor, the foundation was ready to return the state assets and their yields, but continued operation was refused on unfounded legal grounds. He claims that MCC grew the HUF 485 billion state endowment to HUF 825 billion (Telex, HVG, 24.hu). This is his claim; no independent assessment supports it. Citing the Prime Minister’s Office, HVG wrote that with the abolition of the KEKVAs, public assets with a book value of at least HUF 1,284 billion return to direct state control. Book value is the value recorded in the accounting records, which may differ from market value. Also on 4 October, in a Facebook post, Finance Minister András Kármán listed the reclaiming of the assets of the non-higher-education KEKVAs among the deficit-reduction steps (Index).

MIAK has addressed the reclaiming of KEKVA assets in several analyses. On 3 August it called for an itemised inventory and a sales procedure, on 17 August for a statutory framework for asset settlement and legal remedy. On 29 August it proposed a uniform settlement protocol, and on 31 August a balance sheet for using assets as rental housing. The new element now is that with the Student City it becomes visible for the first time what the state will use the reclaimed assets for. MIAK’s reading: reclaiming on its own is not yet a result. The question is whether the assets are put to a measurable public purpose under better rules than before. Three things are missing for this: numerical housing targets, public rules of use and honest budget accounting. The lawsuit of MCC’s founder is an open matter, on which the court will decide.

Part II — Grounding in the literature

Three works provide an interpretive framework for the topic. Susan Rose-Ackerman, professor of law and economics at Yale University, writes in Corruption and Government that one-off, large-scale asset movements can be exploited in both directions: through sale and through nationalisation alike. A credible commitment is therefore needed that decisions are not made through individual bargains. The asset transfer must also be legitimate in the eyes of the public, and the condition for this is an independent court. Joseph E. Stiglitz, American economist, Nobel Memorial Prize laureate and former chief economist of the World Bank, analyses Eastern European privatisation in Globalization and Its Discontents. In his view, a change of owner on its own does not improve the use of assets if there is no institutional framework behind it. The argument also holds for reclaiming: the state as new owner is not automatically better either. And the methodological annex of the International Monetary Fund’s (IMF) World Economic Outlook 2025 report states that the balance showing the lasting state of the budget must be cleaned of one-off items. This is the framework for accounting for the deficit-reduction claim. The detailed discussion of the literature — author by author — is in section 6.4 Literature in detail.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable measures. The first concerns the housing targets of the Student City, the second the rules of use for the reclaimed assets and the legal dispute, and the third the budget accounting of the reclaiming.

3.1 A public target-figure sheet for the Student City (before the design contract and the EU funding application, by 31 March 2027 at the latest)

MIAK proposes that, as the first step in preparing the investment, the Ministry of Transport and Investment publish a target-figure sheet. It should have five elements. First: the number of student hostel places and rental flats per phase, with the planned year of handover. Today the public knows only that a “mixed residential and student-hostel district” will be built, without any numbers. Second: the fee structure. It must be set down for what share of the places and flats there will be a fee cap, and by what formula the cap changes. The formula should be tied to a public benchmark, for example the rent statistics of the Hungarian Central Statistical Office (KSH). Third: the allocation rule, that is, the public weighting of need-based and academic criteria. Fourth: the total cost envelope by source, separately for the EU and the domestic part. Fifth: a written cooperation agreement with the capital and District IX. On the Student City site, adopting the urban planning and local building rules is, as a general rule, a local-government competence. The FKT’s decision and the ministry’s coordinating role do not override this, so the rules of joint work must be set down in writing. This is needed because the history of the site is precisely one of uncertainty about roles. According to Népszava, in December 2024 the previous government expropriated the capital’s and the district’s properties through an omnibus law, paying HUF 3.5 billion for 22 marketable properties of Ferencváros. According to Stiglitz’s argument (see 6.4.2), a change of owner does not guarantee a better outcome. The target-figure sheet makes it measurable whether state ownership now gives more to the community. This is an application of the SZ3 housing data platform and the EP2 housing construction data platform, and, for the construction work, of the EP4 construction-industry transparency programme point.

MIAK’s earlier proposals concerned the inventory and the sale. The Student City now raises a different question: who decides which public purpose a reclaimed property serves? A student hostel, rental housing, a school, a cultural institution or sale? MIAK proposes that the Government lay down in a decree the rules of use for reclaimed KEKVA assets, with four elements. First: the decision on the fate of each property should be based on a prior, public analysis of alternatives. The analysis should compare at least own public-purpose use, letting and sale, with costs and expected social benefit. Second: if a property is used by a non-state body, for example a local government, a university or a housing cooperative, the selection should take place through a public tender with evaluation criteria published in advance. Third: the decisions of the FKT and the Government on the use of assets should be published in full text and with reasons, within 15 days of the decision, in the asset-by-asset register of the A1 public-money dashboard. Fourth: asset items affected by court proceedings should receive a separate marking in the inventory. No irreversible decision — neither sale nor encumbrance — should be made on them until a final court ruling. The outcome of the lawsuit announced by MCC’s former founder is open. The Government should therefore not communicate the reclaiming as a decided, closed matter, but should indicate that it will implement the court’s decision. According to Rose-Ackerman (see 6.4.1), a large asset movement is legitimate if it takes place according to rules, and the independent court is its guarantee. A judgment handed down in a legal dispute and respected by the government itself strengthens the credibility of the reclaiming. This is an application of the A6 checks-and-balances programme point to asset settlement.

3.3 Separating the one-off and the lasting effect in the 2027 budget bill (at the same time as its submission)

The Finance Minister mentioned the reclaiming of KEKVA assets among the deficit-reduction steps. The post described in the press, however, does not reveal by what amount and under what item the reclaiming appears in this year’s or next year’s deficit. MIAK proposes that the explanatory memorandum of the 2027 budget bill contain a separate table on the reclaimed assets. The bill is submitted by the Government and adopted by Parliament. The table should answer four questions. First: what is the book value and the estimated market value of the reclaimed assets, by asset type (property, shareholding, securities). Second: which items are one-off, for example revenue from selling a property or a block of shares. Third: which items are lasting, for example annual budget payments that cease, or the regular yield of the assets. Fourth: how the individual items are accounted for under the EU statistical methodology, that is, which improves the deficit and which only the debt. The Fiscal Council should also give an opinion on the table. According to the IMF’s methodology (see 6.4.3), the lasting state of the budget is shown by the structural balance. This is the balance cleaned of the effect of the economic cycle and of one-off items. If money from selling the reclaimed assets appears as lasting deficit reduction, the same gap reopens the following year. This is an application of the G1 data-driven budget and the G23 debt-sustainability programme points.

The three proposals are linked by one principle: the reclaimed assets are in better hands only if their use is measurable, the decisions are reasoned, and the accounting does not embellish. For the Student City the yardstick is the housing target, for the other asset items the public decision on use, and in the budget the separation of the one-off and the lasting effect. Rose-Ackerman’s and Stiglitz’s frameworks lead to the same place: it is not the identity of the owner but the quality of the rules that decides whether a large asset movement will serve the public good.

Part IV — Expected effects and risks

Dimension Expected effect Risk
Housing and education The Student City provides a measurable number of affordable student hostel places and rental flats, and the fee cap is predictable The binding nature of the target-figure sheet reduces planning flexibility; if EU funding slips, the committed figures cannot be kept
Public assets The reclaimed properties are put to the public purpose with the greatest social benefit, by reasoned decision The analysis of alternatives and the tender slow down use; meanwhile an empty property keeps generating costs
Rule of law Holding back the asset items involved in the lawsuit preserves the meaning of the court’s decision and strengthens the credibility of the reclaiming A protracted lawsuit may freeze some asset items for years; the government may come under political pressure to move faster
Budget Separating the one-off and the lasting effect makes the deficit path more credible to markets and EU institutions The table may show that the lasting deficit-reducing effect of the reclaiming is smaller than communicated, which is politically uncomfortable
Government and capital The written cooperation agreement reduces disputes over competences on the Student City site If the agreement is not concluded, the joint body’s decision and local-government regulation may clash, and the project stalls again

The most important trade-off is the relationship between speed and regulation. The housing crisis is pressing, and every month a reclaimed property stands empty is a lost opportunity. The tender, the analysis of alternatives and holding back the elements involved in the lawsuit slow things down. Experience shows, however, that asset decisions made quickly, through individual bargains, become more expensive later. The Student City itself is the example: from the student hostel plan through the Fudan campus to the expropriation, the site changed owner and purpose several times, and according to Népszava it was for a time even stripped of its student hostel function. Pre-set rules of use take a few months, but at the next change of government everything does not have to start again.

In budget accounting, the risk is political discomfort. If the table shows that the deficit-reducing effect of the reclaiming is largely one-off, the government’s deficit-reduction narrative weakens. According to MIAK, this is an acceptable price. Before the Fiscal Council and the EU institutions, the credible deficit path is the one that shows one-off items separately, not the one that paints the most favourable picture.

Part V — Measurability and summary

5.1 What is worth following? (suggested KPIs)

MIAK suggests the following key performance indicators (KPIs). These are suggested indicators, not government commitments.

  • Publication of the Student City’s target-figure sheet. Target: by 31 March 2027, the number of places and rental flats per phase, the formula of the fee cap and the total cost envelope by source are public.
  • The share of decisions on use published with reasons. Target: 100% of the decisions on the use of reclaimed KEKVA assets made after 1 January 2027 are public in full text and with reasons within 15 days.
  • The number of irreversible decisions made on asset items affected by court proceedings before a final judgment. Target: zero.
  • A table separating the one-off and the lasting effect in the 2027 budget bill. It is worth following whether the table is produced and whether the Fiscal Council’s opinion addresses it.

5.2 Summary

MIAK’s request is addressed to the Government and the Ministry of Transport and Investment, with three deadlines. At the same time as the submission of the 2027 budget bill: a separate table on the one-off and the lasting budget effect of the reclaimed assets. By 31 December 2026: a government decree on tender-based rules of use for the reclaimed KEKVA assets, with the asset items involved in the lawsuit kept separate. By 31 March 2027: the Student City’s target-figure sheet with places, fee cap and cost envelope. In the legal dispute over the dissolution of MCC the court will decide, and MIAK asks that the Government not communicate the matter as closed until then.

Of MIAK’s foundational values, transparency and data-drivenness are at stake here. Transparency, because the reclaimed assets are the common property of citizens, and the reasons for decisions on their use cannot remain an internal matter. Data-drivenness, because the success of the Student City is shown not by the announcement but by the places actually handed over and the fee level. And in the budget, only the deficit reduction that remains the following year is credible.

Part VI — Reasoning and further sources

6.1 Press framing by spectrum

In the left-liberal band, Népszava gave the most detailed background on the Student City. With a strong value judgement, the paper wrote about a project “derailed” by the Orbán government, and recalled the assets given to the Fudan foundation, the 2024 expropriation, the sum paid for the Ferencváros properties, and the master plan of the Oslo architecture firm Snøhetta, winner of the international design competition. HVG reported briefly on the Student City, following the ministerial announcement. In the MCC case, however, it provided context: the Prime Minister’s Office’s figure of HUF 1,284 billion in book value, and the fact that not a single KEKVA submitted an application for registration of changes to the Budapest-Capital Regional Court, so they ceased to exist without a legal successor. Telex reported on András Tombor’s statement and presented MCC as an “elite-training institution with strong Fidesz ties”. It also recalled that the foundation was set up in 2020 by András Tombor’s father with HUF 2 million. In the processed source list there was no article on the topic from 444.hu.

In the public-affairs band, 24.hu covered both strands factually, building on the statements of the actors. The article on the Student City highlighted the easing of the housing crisis, the one on MCC reported the main claims of the statement. Index published the Finance Minister’s Facebook post without its own assessment. In it, the reclaiming of KEKVA assets appeared as a deficit-reduction step alongside the unlocking of EU funds. In the economic press, Portfolio did not include the topic among its featured topics on the processed day. In the conservative band, Magyar Nemzet foregrounded the viewpoint of MCC’s founder: according to the headline, the Tisza government “destroyed thirty years of work”. The article presented Tombor’s claims — the cost of cancelling programmes, the violation of fundamental rights — as statements of fact, without a counter-view. The paper published no article on the restart of the Student City on the processed day. No fresh content from Mandiner was available on that day.

6.2 Facts and data

The Student City and the assets of the Fudan foundation:

Data Value Source
FKT decision on restarting the Student City 4 October 2026; preparation at the Ministry of Transport and Investment 24.hu, HVG, Népszava
Design basis the winning design of the earlier international design competition (Snøhetta) 24.hu, Népszava
Financing linked to the Wekerle Housing Construction Programme, with EU funds drawn in 24.hu, HVG, Népszava
Assets given in 2021 to the Fudan foundation (from 2025 the Tudás-Tér Foundation) HUF 600 million capital, HUF 6 billion development funds, a 17.8-hectare property portfolio recorded at almost HUF 13 billion Népszava
Expropriation in the development area under an omnibus law of December 2024; a total of HUF 3.5 billion for 22 marketable properties of Ferencváros Népszava
Dissolution of the Tudás-Tér Foundation August 2026 Népszava

The reclaiming of KEKVA assets and MCC:

Data Value Source
Assets coming under direct state control with the abolition of the KEKVAs at least HUF 1,284 billion in book value (statement of the Prime Minister’s Office) HVG
Completion of the abolition of the non-higher-education KEKVAs 31 August 2026; no application for registration of changes was received, dissolution without a legal successor HVG
Dissolution of the foundation operating MCC 31 July 2026; by decision of the Prime Minister’s Office Telex
State assets given to MCC and their claimed growth from HUF 485 billion to HUF 825 billion (András Tombor’s claim, without independent assessment) Telex, HVG, 24.hu
Earlier data: assets returned from four foundations to the Ministry of Transport and Investment HUF 100 billion (30 August 2026) MIAK, analysis of 31 August 2026

The Finance Minister’s deficit claim: According to András Kármán’s Facebook post, the previous government planned for a deficit of 3.7% of gross domestic product (GDP) this year, but without measures the deficit would have been 8.3%. The listed deficit-reduction steps include the reclaiming of the assets of the non-higher-education KEKVAs (Index, 4 October 2026). This is a political assessment, not KSH or Eurostat data. The post does not quantify how much deficit reduction can be attributed to the reclaiming of the assets.

6.3 Policy dimensions

  • Transparency and anti-corruption policy (programme points) — asset-by-asset publicity of decisions on the use of the reclaimed assets (programme point ID: A1); respecting the judicial route and keeping separate the asset items involved in the lawsuit (programme point ID: A6);
  • Construction (programme points) — the Student City’s numbers of flats and places, and their phasing (programme point ID: EP2); publicity of the procurement and cost data of the construction work (programme point ID: EP4);
  • Social policy (programme points) — the fee cap and the allocation rule as tools of affordable housing, a public benchmark for rents (programme point ID: SZ3);
  • Education (background material) — the shortage of student hostel places as a barrier to access to higher education; restoring the student hostel function of the Student City;
  • Economy (programme points) — separating the one-off and the lasting budget effect (programme point ID: G1, G23);
  • Legal foundations (background material) — the FKT is a consultative body; its decision does not override the local-government competences of the capital and District IX; in the MCC case the court decides.

6.4 Literature in detail

6.4.1 Susan Rose-Ackerman: Corruption and Government

In the part on high-level corruption, Rose-Ackerman describes how corrupt power can profit not only from continuous state intervention but also from one-off, large changes. It may therefore simultaneously support the privatisation of some companies and the nationalisation of others. According to the author, in such an environment private investors are cautious unless there is a credible commitment that the state will not make further individual, one-off decisions. In the chapter on the credibility of privatisation, she analyses the Eastern European transition. In her view, in large-scale asset transfers speed must be weighed against the long-term value of clear legal rules and against whether the public accepts the asset movement as legitimate. The process must ensure the widest possible participation, and must be transparent, especially in asset valuation. In the part on judicial independence, she stresses that when the state acts as buyer, seller or grantor of concessions, an independent court is a necessary guarantee of impartiality. She also gives an example of a supreme court delaying privatisation because of its review of challenged sales. Applied to the Hungarian KEKVA reclaiming: the reclaiming, too, is a one-off, large-scale asset movement, and its credibility depends on whether the assets are passed on according to rules, competitively and by reasoned decision (3.2). The lawsuit of MCC’s former founder is not an obstacle to the legitimacy of the reclaiming but precisely its test: if the government respects the court’s decision, the reclaiming will stand as an act of the rule of law, not a political one.

📖 Source: Susan Rose-Ackerman: Corruption and Government — Causes, Consequences, and Reform

6.4.2 Joseph E. Stiglitz: Globalization and Its Discontents

Analysing the transition of the former socialist countries, Stiglitz writes that those urging rapid privatisation wrongly assumed that if property rights are clear, the new owner will manage the assets efficiently. Without adequate legal and market institutions, however, the new owners had more of an interest in stripping the assets than in increasing them. The author cites a World Bank review according to which privatisation without an institutional background had no demonstrable positive effect on growth. In his view, what matters is not the speed of the ownership change but the sequence: first the regulatory and supervisory framework, then the change of ownership. The idea is valid in the opposite direction too. The fact that the KEKVA assets have returned to the state does not on its own guarantee better use. The state as owner can leave the assets unused or pass them on through individual bargains just as the foundations could before. The Student City will therefore be a success not because of the announcement, but if it is built according to pre-set, measurable housing targets (3.1).

📖 Source: Joseph E. Stiglitz: Globalization and Its Discontents

6.4.3 International Monetary Fund: World Economic Outlook 2025

The methodological annex of the IMF’s world economic report defines the structural balance. According to the annex, “The structural balance is the actual net lending/borrowing minus the effects of cyclical output from potential output, corrected for one-time and other factors, such as asset and commodity prices and output composition effects.” In other words, the lasting state of the budget is described by the indicator from which the effect of the economic cycle and one-off items have been filtered out. A country-specific methodological note also states that, in estimating the fiscal balance, the IMF — in line with the international manual of government finance statistics (GFSM 2014) — does not count privatisation operations, even if the given country’s own methodology treats them as revenue. Applied to the Hungarian deficit-reduction claim: money from selling the reclaimed assets is at most a one-off item, and under the international methodology part of it does not affect the deficit at all, only the debt. A lasting effect arises where a recurring expenditure ceases or the assets generate a regular yield. This is the difference the 2027 budget bill must show item by item (3.3).

📖 Source: International Monetary Fund: World Economic Outlook — Global Economy in Flux (2025)

6.5 International comparison

The European model of large-scale state asset movements is Germany’s Treuhandanstalt, which carried out the privatisation of East German state enterprises between 1990 and 1994. Its operation remains controversial to this day; the Bundestag set up a committee of inquiry into its activities. The lesson for the Hungarian situation is that the legitimacy dispute over asset decisions made quickly and centrally can drag on for decades. It is therefore worth providing public reasoning and a route of legal remedy at the very moment of the decision. Rose-Ackerman cites a comparative study of the same period. According to it, the slow, highly discretionary and poorly transparent forms of transfer were the most vulnerable, while public procedures run independently represented a middle ground between speed and transparency.

In budget accounting, the IMF’s practice shows the risk of divergent accounting: in its own estimates the IMF filters privatisation revenue out of the fiscal balance even if the given country’s official figures treat it as revenue. If the Hungarian government does not break down the effect of the reclaimed assets item by item, domestic and international institutions may work with different deficit figures. This would weaken precisely the trust that deficit reduction aims to build. Showing the lasting effect is therefore also in the government’s own interest.

Transparency and anti-corruption policy

  • A1 — Public-money dashboard
  • A6 — Strengthening checks and balances

Construction

  • EP2 — Housing construction data platform
  • EP4 — Construction-industry transparency

Social policy

  • SZ3 — Housing data platform

Economy

  • G1 — Data-driven budget
  • G23 — Public-debt sustainability framework

Proposed new programme point: Tender-based rules of use for reclaimed public assets — analysis of alternatives, public tender, reasoned decision, separation of the asset items involved in lawsuits — for the Transparency and anti-corruption policy area.

Proposed new programme point: Housing target-figure sheet for state housing and student hostel construction — number of places, fee-cap formula, allocation rule, cost envelope before design — for the Social policy area.

6.7 List of sources

Press sources (MIAK press monitor, 5 October 2026 — topic 2):

Knowledge base references (books):

  • 📖 Susan Rose-Ackerman: Corruption and Government — Causes, Consequences, and Reform
  • 📖 Joseph E. Stiglitz: Globalization and Its Discontents
  • 📖 International Monetary Fund: World Economic Outlook — Global Economy in Flux (2025)

MIAK internal materials:

Supplementary public data sources:

  • Register and reports of civil society organisations (data of the dissolved foundations) — https://birosag.hu/
  • Opinions of the Fiscal Council on the 2027 budget bill
  • KSH housing market and rent statistics — https://www.ksh.hu/

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