Pension reform in Austria: Experts demand immediate measures!

Pension reform in Austria: Experts demand immediate measures!

On Monday, a specialist forum on the reform of the pension system in Austria took place, initiated by Federal Council President Andrea Eder-Giftschthaler (ÖVP). This event critically examined the challenges that arise from the increasing life expectancy and growing inequalities in the pension system. Experts demanded an alignment of the retirement age to life expectancy to ensure the future sustainability of the system. In particular, the “pension gap” between women and men, which is still a central concern.

The work and social law expert Rudolf Mosler described the pension system as a fundamental socio-political topic. The discussion discussed solutions that could include an increase in contributions, state subsidies or an extension of employment. The Austrian pension system offers relatively high pensions in international comparison, and the contribution rates are stable. A false perception of necessary reforms is rejected by the experts, since early retirement has been restricted for several years and a change to a “life-design” model has taken place.

Need of reforms

From 2024, a gradual alignment of the retirement age of women and men is planned. Other planned reforms of the current federal government provide for an increase in insurance years for the corridor board and the introduction of a partial board. Christine Mayrhuber from WIFO emphasizes the need to promote longer employment and to operate an active labor market policy. The high risk of poverty in women over 65 and in one-parents households is particularly worrying.

In addition, the review of the past decades is considered in which only 10% of women no longer have their own pension entitlement. Monika Köppl-Turyna from Ecoaustria emphasizes that there is a correlation between social status and life expectancy. It suggests regulating social inequalities in the social system and not in the pension system in order to distribute the challenges more evenly.

international comparisons and perspectives

Austria's expenses for pensions are significantly above the EU average and continuously rise, while the performance ratios from the pension system decrease noticeably. A current study by Ecoaustria, which was carried out on behalf of the first foundation and the Vienna Insurance Group, shows concrete starting points for a pension reform in Austria. The goal is to increase the performance of the Austrian pension system and competitiveness.

The Austrian National Bank (OENB) reports that compared to countries such as Denmark and the Netherlands, the capital -covered pension systems use and thus relieve its state budgets, Austria has a lower relation of average pension to average wages. While this relation in Denmark is 61% and 67% in the Netherlands, it is only 56% in Austria. This could increase the risk of old -age poverty in the long term if reforms are not tackled in good time.