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09. 02. 12. - 18:00

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09. 02. 12. - 18:00

WKO boss wants pension age hike incentives

Federal Economy Chamber (WKO) President Christoph Leitl has identified attempts to raise the average retirement age as the key issue regarding Austria’s budget.

Leitl told radio station Ö1 yesterday (Weds) the Austrian government of Social Democrats (SPÖ) and the People’s Party (ÖVP) must create a new system which encourages people to work longer. Leitl said men’s average retirement age must rise by four years to 62 soon. Such a step would mean Austrians are getting closer to fulfilling labour laws which say men must work until aged 65. Work regulations also have it that women should not retire before turning 60. However, the country’s average retirement age for women is 57.5 years at the moment.

The WKO boss rejected fears that the economy was not prepared for employees. He underlined the urgent demand for high-skilled workers and trainees. Leitl said the labour market would manage to create circumstances which allowed people to work longer than before. He appealed to the government to create a political frame which guaranteed that later retirement was financially more attractive than an early farewell to work. Leitl said those interested in working longer than others must also be rewarded sufficiently after retirement while people quitting before the regular retirement age should accept lower pensions.

Austria has the lowest unemployment rate in Europe at 4.1 per cent but statistics also show that only 42 per cent of Austrians aged between 55 and 65 have a job. Sweden is the European Union’s (EU) role model in this regard at 70 per cent with Germany in second place (58 per cent). Leitl stressed yesterday that any kind of reform of the pension system must consider people’s individual lifestyles and preferences. Experts suggest to concentrate on providing health checks and sports courses to employees of all ages to help them stay in the labour market as long as possible. Some researchers think elderly people should be allowed to work only three or four days a week.

The WKO has a strong influence on decision-making procedures in the ÖVP while the policies of the Labour Chamber (AK) and the Federal Trade Union (ÖGB) are normally not ignored by the SPÖ board. ÖGB President Erich Foglar suggested laws should force firms to employ older people. Foglar claimed a legal measure may be needed to raise the number of older employees since most enterprises would ignore recommendations and initiatives focusing on voluntary participation.

Speaking about the current austerity package negotiations between SPÖ and ÖVP, Foglar criticised that new claims about how much money must be saved in the coming years were leaking every day. He called on the coalition for precise information – and warned from increasing the tax burden on workers and the middle class. The political leaders of Austria’s nine provinces are also demanding further facts. Reports have it that talks between the federal government and regional lawmakers about how strongly the provinces must tighten their belts in the next years will take more time than initially scheduled by SPÖ and ÖVP.

Only on Monday, ÖVP pensioners' association head Andreas Khol revealed that ÖVP chairman and Vice Chancellor Michael Spindelegger summoned the federal board of the party for the same evening. Khol explained that Spindelegger hoped having finalised the negotiations with SPÖ, ÖGB and the provincial governors by then. The ex-ÖVP whip said the savings package would probably be presented "in six to seven days’ time".

Austria's debts have soared to 215 billion Euros. The country is forced to offer increasing interest rates to investors interested in buying government bonds because of these developments. The pressure on the coalition to act rose dramatically last month when Standard & Poor’s (S&P) downgraded Austria from the best possible estimation of AAA by one grade to AA+. Moody’s and Fitch, the world’s other leading rating agencies, confirmed their AAA rating for the country.

Austrian Times

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