Hungary – The financial decline of the most popular club

The long decline of the mighty Magyars is reflected in club football, too, as the country's only European club competition winners descend into financial chaos. Jonathan Wilson reports

When things in Hungary are really bad, they are said to a béka segge alatt – under the belly of a frog. Football was generally held to have reached that point about 15 years ago. Since then, it has kept falling. Every summer the league descends into chaos, as clubs merge, move towns looking for sponsors, change names and go out of business. Matters seemed to have hit rock-bottom in 1999 with the farce that surrounded a bomb hoax at second division Dunakeszi. The hoaxers were foiled by a recorded message, advising them that Dunakeszi’s phone had been disconnected, but they could leave a message at the factory next door. And then came this summer.

This time, surely it is true: things can’t get worse. Not only were Ujpest knocked out of the UEFA Cup by Vaduz of Liechtenstein, beaten 4-0 in Budapest, but Ferencváros – 28 times champions, Fairs Cup winners in 1965, Cup-Winners Cup finalists in 1975 – have been relegated for failing to satisfy the licensing authority that they could balance their budget. For the first time in its 105-year history, the Hungarian first division begins without its most popular club.

This being Hungary, nothing is entirely clear. The president of the football federation (the MLSZ), István Kisteleki, has said that he has interpreted the regulations as leniently as he could, which is generally taken to mean that Ferencváros have failed to proved “reliable documentary evidence” that they can fulfil 75 per cent of their budget for the season. Given that their debt is reckoned to be more than one billion forints (£2.5 million), that’s hardly surprising.

Only a last-minute loan of around £600,000 from OTP, Hungary’s biggest bank, had saved the club the previous year. The government, though, did its best to help, devising a scheme whereby any investor wishing to lease the four hectares of wasteland next to Ferencváros’s ground – an area ripe for development – also had to lease the two hectares on which the club’s stadium stands and undertake to modernise it.

So in May, the licensing authority – whose members are theoretically anonymous – granted Ferencváros a licence, on condition they kept the MLSZ informed about potential investors. A second licensing committee, though, overturned that judgment, only for certain members to convene – in the ab-sence of the chairman and two others – to reverse that verdict. That decision was annulled by the MLSZ, who insisted the chairman had to be present, and on July 25 a third committee confirmed that Ferencváros would not be granted a licence.

Ferencváros protested, pointing out that the main beneficiaries were Vasas, whose relegation to the second division was cancelled. They had just appointed their former player Géza Mészöly as coach, so what a coincidence it was, Ferencváros sneered, that on one of the committees had sat Kálmán Mészöly, a former Hungary international and Géza’s father.

Few neutrals have much sympathy, with the general feeling being that it’s about time some decisions went against Ferencváros. Ferencváros’s poverty is hardly in question: they pulled out of a friendly against Felcút in July because they could not afford to hire a bus. But it is suggested that if Hungary were not bidding to host Euro 2012 (jointly, with Croatia), the MLSZ would not interpret UEFA’s licensing rules quite so strictly.

Some believe that the relegation of the nation’s biggest club will force Hungarian football to take a more responsible attitude to money, with Ferencváros captain Peter Lipcsei calling on the board to resign. Others, though, suggest the situation is impossible. “We can’t afford players and we lose any good young players immediately,” admitted István Sálloi, the former sporting director of Ujpest. “A lot of young players go to the sixth division in Austria and get better money than they would here. Sponsors are difficult to find, because they think it’s not a good level. If the level rises the money will come, but without money we cannot raise the level.”

Ferencváros are trapped in a similar cycle: without top-flight football it will be impossible for them to pay off their debts, and so, even if they finish in a promotion spot – as, given their squad, they should – they will not be permitted to go up. The whole situation seems hopeless.

From WSC 235 September 2006. What was happening this month