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Pensionskassen could be reformed

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  • Pensionskassen could be reformed

AUSTRIA - The new Austrian government coalition has signed a working paper which contains plans to discuss reform of the Pensionskassen system in Austria.

The new government - which is in fact a continuation of the old coalition between the centre-left Social Democrats (SPÖ) and the centre-right People's Party (ÖVP) - has included the second pillar in its agenda of things to tackle over the next legislative period

The paper stated minimum buffers, transparency and whether people should have more choices will be looked at in particular.

No details have been given as the so-called government programme - which is signed by every coalition as part of the agreement to work together - only contains ideas and topics.

However, representatives of the Pensioners' Council (Seniorenrat) are excited about the government's commitment to talk about the issue

Andreas Khol, president of the multi-party organisation and former ÖVP parliamentary leader, has called on the government to set up a reform commission "immediately - if possible before Christmas".

"We demand a guarantee on the value of occupational pensions and a rescue fund guaranteeing the asset value (as per year end-2007, ed.)," said Khol.

The council has suggested Pensionskassen members be allowed to decide in the future whether they want their money to be invested with or without guarantees

He stressed Pensionskassen are important "for the whole economic system" therefore the second pillar had to be secured "just like banks and the capital market".

"The errors made by those who invented the Pensionskassen, which are now burdening people who receive pension payments, have to be rectified. This part of the capital market also has to be safe," argued Khol, referring to high conversion rates negotiated in the early 1990s when the system was set up.

No mention was made in the government programme, however, about the pension deal for the first pillar and how to deal with pensioner longevity.

This agreement was one of the reasons why the last coalition between ÖVP and SPÖ broke down earlier this year. (See earlier IPE-story: Pension deal dies along with coalition)

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