Hayek’s structural analysis initiates a reorganization
For his study, Hayek collected a significant amount of institutional data that was, at the time, fragmented among different sources or not accessible at all. The data included the university’s opaque financial flows and organizational processes, which were so cumbersome that they regularly provoked complaints. Hayek proposed a governance system based on a newly created University Council and a strengthened position of rector. The report recommended the withdrawal of direct state influence on political funding decisions via a global budget, and on the election of the University Council as the crucial link to politics and society. The Oversight Committee was to be replaced by the University Council, and the Education Council was to lose its jurisdiction over university matters. The university would remain divided into faculties, but Hayek proposed additionally forming more narrowly focused departments linking closely related academic subjects, with responsibilities limited to financial and organizational matters. It was these departments that provoked the most resistance in consultations with the university, while on all other issues the Hayek analysis was remarkably well received.

The fact that the structural analysis integrated a number of ideas for reform developed at the university itself led some observers to retrospectively estimate the benefit of the study as low: what Hayek ended up saying was, in essence, nothing new. But this perspective overlooks the political significance of the report, which was indispensable for winning the confidence of the canton of Basel-Land that true reforms would be enacted. Hayek was able to underscore the willingness of Basel-City to in fact relinquish direct control of the university. His analysis also produced a series of concrete, interlinked proposals requiring further work before fine-tuning made it possible to implement them in 1994/95. The report bolstered the reform-minded forces both inside and outside the university, even if not all of its proposals were fully fleshed out.

Working on implementation
From 1992 to 1994, several working groups took up the reform project. Hayek had indicated the general direction, yet many questions still needed to be clarified. Depending on the topic, the working groups were more dominated by representatives of the cantonal administration or by members of the university. Overall, the university participated in its own restructuring to a remarkable degree – and with a certain enthusiasm – which can be understood as an expression of trust extended by both governments to the university. The project-based working groups thus laid the foundation for the formulation of a new University Agreement between the two cantons and a new University Act to replace the 1937 law that was still in force.

Work on the reform progressed rapidly: faced with an overarching political will to succeed, differences or unresolved issues remained secondary, focused mainly on the new governance structures and issues of codetermination (which had played an important role in the failure of the 1980 University Act). The discussion in the Senate revealed some unease about whether the proposed University Council would be able to make strategic decisions independently or only in agreement with the university management bodies. It was evident that the governments were aiming to institute clear, hierarchical structures.

Yet what also became apparent was that no uniform concept of “autonomy” was shared by all. Many university members envisioned institutional autonomy as an extension of their individual autonomy within the framework of academic self-governance. What this perspective failed to see was that institutional autonomy also entailed new forms of governance and oversight, along with expanded accountability of the university to the public. These issues could not really be resolved at this stage, and they unmistakably held the potential to stoke conflict in the future.

Codifying the university’s renewal: Mission Statement, University Act, and University Statute
For the first time and as part of the ongoing process of change, the university adopted its own vision in 1993, expressing overarching goals in an idealistic cast and emphasizing a self-determined path into the future. The new governance structures relied on cooperation between the newly established University Council and a rector whose position had been strengthened. The University Council was intended to represent social and political interests at the university. And the enlarged administration – with numerous positions to be transferred from the canton to the university – was to be led by an administrative director in the future. Moreover, a university planning commission was envisaged.

The University Act outlining these organizational structures was considerably more concise than its predecessor, running to only twenty-nine paragraphs. It was a framework law, with detailed implementing provisions delegated to a statute yet to be written. The drafting of these statutes in 1994/95 proceeded relatively slowly. Divergent interests clashed over details, leading to an expansion in the document’s scope. Determining categories of staff also required significant effort. Consequently, the statue was still incomplete when the university was granted autonomy at the end of 1995. The final editing fell within the purview of the University Council, which sought to streamline and clarify the document, which was adopted in the spring of 1996.

The integration of the Faculty of Medicine, with its unique position at the university, also remained incomplete. First, it was not only deeply intertwined with cantonal hospitals, but also provided services and other contributions in areas of teaching and research. And second, it did not operate under the authority of the Department of Education but rather of the Health Department. Difficulties were also caused by its connection to regional health policy, which still lacked the necessary coordination between the two cantons. Despite protracted efforts, then, provisional solutions remained in place for the time being.

Steps toward political unification
Parallel to these efforts, steps toward political unification and the necessary bills to be passed in each canton moved ahead rapidly. By the end of 1991, the amount of the additional funds needed for the university from Basel-Land had been broadly determined: some thirty million francs. The amount would nearly double the canton’s total expenditures for the university, while at first still leaving the canton in the position of an expanded minority stake. Parliamentary approval was facilitated and accelerated by the early involvement of the committees holding jurisdiction, which also consulted with each other. Differences arose less between the cantons than within internal Basel-City politics, after members of the Grand Council realized that the government intended to keep control over appointments to the University Council, or was only willing to share this authority with the government of Basel-Land.

After the University Agreement was been signed by the two governments in the spring of 1994, the only choice left for each canton’s parliament was to vote it up or down. This broad exclusion of parliamentary influence in shaping the legal framework between the cantons that was becoming increasingly necessary for the new university structure caused discontent, yet also the predictable consequence of parochial political fragmentation in a region that was constantly growing closer together. The attempt to partially reestablish possibilities for each canton’s parliament to exert influence would continue to play a recurring role vis-à-vis the autonomous university. All in all, however, there was a strong consensus to successfully implement the reform; the expected – and for some, feared – referendum in Basel-Land proved unnecessary.

The years of institutional restructuring were burdened by increasing financial pressure, as the recession of the early 1990s produced record deficits in government budgets. Since 1987, Basel-City had temporarily provided certain additional support to create new – and urgently needed – positions at the university. Starting in 1992, this funding ceased; new austerity measures darkened the outlook and made the increased financial involvement of Basel-Land all the more urgent. At the same time, the number of students, which had grown only slowly in the 1980s, suddenly saw a marked increase. In the areas experiencing growth, such as psychology, the ratio of faculty to students deteriorated – in some cases dramatically.