Austria considers civil service pension fund
AUSTRIA - The Austrian pension market could be boosted by up to 100,000 new pension scheme members with the cabinet poised to consider a draft to set up a pension fund for civil servants.
The plan to start a pension fund for civil servants comes within the government’s broader scope of pension harmonisation, explained Hermann Feiner of the Gewerkschaft Öffentlicher Dienst, the public service union.
Feiner explained that “Beamte”, civil servants, have not yet been allowed to join the developing pension market, while a part of the public employees, with fewer privileges, has joined the Bundespensionskasse, BPK.
The framework of regulations to start the civil service pension fund is still to be established, Feiner explained. “This is an aspect of many aspects in the pension fund question.”
The Cabinet could start working on the plan in early October, but it could be months before a draft is presented to parliament.
“The questions at the moment is - how the parliament sees this, when the pension fund would be allowed and how the civil servants would like it,” he said.
“There are still so many questions to be dealt with,” he said.
Paul Kocher, head of the BPK, agreed it was still early days to gauge the effect the new pension arrangement would have on the market. But he added that if the system changed, between 50,000 and 100,000 people would be joining a pension fund, possibly the BPK.
At the moment the BPK has a capital value of about 30 million euros and about 40,000 members.
Robert Hau, head of continental Europe at Bank of Ireland Asset Management, said a new fund for civil servants was “a big challenge” for asset managers.
“This process will not happen overnight. I think public employees funds could come into existence in two, three years and there will be a big opportunity.