In the new Austrian Government, the Minister of Social Affairs from the Freedom Party of Austria (FPÖ) is trying to make fundamental changes to the social welfare state.

GD – 05/2018

In addition to de facto spinning off general accident insurance as a separate entity, which is supposed to cut costs, there is a basic move to abolish the system of self-governance. As if this is not enough, the ‘contribution collection’ refinancing system is to be converted into a tax model. As reported by the Wiener Zeitung and Kurier newspapers, there is considerable public opposition to this unfounded interference in a proven structure that functions well.  

In the Austrian self-governing committees, employers and employees are represented by their state chambers of commerce and chambers of labour respectively. According to numerous experts, the success of the Austrian social system is due to the social partners working together on important strategic decisions, a high degree of independence from short-term political interests, and a focus on the real interests of the social security system and the circle of persons protected by it.  

Critics see the attack on the deeply embedded system of self-governance as more of a reaction by newly elected far-right politicians to the fact that they have hardly any representation on the self-governing committees compared to the other political parties. The many arguments in favour of maintaining, and even strengthening, self-governance can be seen by looking at the social security systems of EU countries that do not have self-governance and instead operate purely on tax-based models. For years, there has not been a single tax-financed health model in the EU without long waiting lists, serious deficiencies or even reliance on the shadow economy to access healthcare.  

Falling tax revenues and serious debt problems in the Member States have paralysed the strategic financial planning capacity of social security funds. In France, the general public has just become aware of this. The history of social security shows that structural changes of a massive nature in well-functioning social security systems often deal with dismantlement, but subsequently falter. Why one of the best social security models in Europe should be restructured to be more like a system that one would rather not have remains the secret of those who are currently trying to do this in Austria.  

Experts have observed that the Austrian People’s Party (ÖVP), the stronger coalition partner of the Federal Chancellor, has been relatively quiet in this sensitive discussion. There is evidence that suggests it is well known how important a properly functioning social system is and how little one can gain through systemic change.