"Krone" commentary

New recipe for pension reform

Taking stock for the "Krone": Head of Economics Georg Wailand(Bild: Krone KREATIV)

Whenever the word "pension" appears, even in connection with a "reform", there is sure to be an outcry from the public: politicians are allowed to do many things, but not one in Austria: "tamper" with pensions.

The reflex response is a prompt rejection that such a thing is highly antisocial and therefore cannot be done. And anyway: this generation has worked for decades and helped create today's prosperity, so nothing should be taken away from them in old age.

Therefore: no reforms at all, and it should therefore come as no surprise that the pension system in Austria is more expensive than in other countries. To put it plainly: public spending on pensions in Austria is the fourth highest in the OECD and well above the EU average. This will become a problem in the long term.

However, pensions could be even higher if the state were prepared to invest in securities. As many countries have been doing for a long time (e.g. Denmark and Sweden). This would make pensions more secure (especially in the long term) and more profitable.

However, to ensure that not every reform idea is immediately shot down, former minister Löger and former bank boss Treichl are serving up their reform proposal with a new recipe: an open evaluation of all alternatives. Courageous to propose something like this just before an election. But it would be necessary . . .