Expert Opinion – Officials Curb Rise in Pension Costs

It is true that everything is dwarfed by the pandemic. But in the run-up to the meeting of the old-age pension commission, which will discuss new pension reports next Tuesday, the debate about further interventions in the pension system has reignited. As the “Wiener Zeitung” reported in advance, the new reports forecast a significant increase in expenses from the budget for pensions by 2026 – by almost seven to 31 billion euros in 2026 for the statutory pension insurance for employees, self-employed, farmers and civil servants .

The Chamber of Labor and the Federation of Trade Unions see no need for further pension cuts and reject a statutory retirement age above 65 years. The liberal research institute Agenda Austria, on the other hand, calls for an automatic increase in the retirement age linked to life expectancy.

The trigger for the new conflict are the reports up to 2026 and, in the long term, up to 2070. The budget funds for pension insurance have risen by more than five to 16.4 billion euros. In the case of civil servants’ pensions, they rise from 13 to 14.6 billion euros. Measured against economic output, however, the expenses for civil servants cushion those for statutory pension insurance. In the case of civil servants’ pensions, they even go down from 3.2 to 2.9 percent of the gross domestic product. In the case of statutory pension insurance, on the other hand, the share of pension costs will increase from 3 percent to 3.26 percent of gross domestic product in 2026

The AK experts Erik Türk and Wolfgang Panhölzl as well as their ÖGB colleague Dinah Djalinous-Glatz do not see the sustainable financing of pensions in jeopardy, in contrast to economists and the Neos. One reason they cite is that the Schüssel era reforms are still ongoing. This applies above all to the extension of the calculation period until 2028 to ultimately 40 years. As a rule, this reduces the amount of pensions paid out, especially for women with fewer years of work or part-time jobs, but also for high earners, for whom the 15 “best” years were once used and for whom it will be 40 years in 2028.

AK against raising the retirement age

In the Chamber of Labor, however, it is argued that pensions for young people will no longer be financially viable in the future. The increase in the actual retirement age can already be seen through stricter rules, a higher statutory retirement age is rejected, also because many are currently unemployed before they can retire. In addition, for women born in 1963 or later, this will be gradually increased from 60 to 65 years from 2024 to 2033.

Agenda Austria boss Franz Schellhorn not only warns of the “pension hole” in the budget. He also reiterated the proposal to automatically increase the retirement age. This should be linked to increasing life expectancy.

Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *