Economic Policy in Austria

Accession to the European Union, the introduction of the Euro, the increasing internationalisation of economic relations and a rapid economic structural change have characterised and fundamentally changed the basic framework and limited the scope of Austrian economic policy during the last few years. However, the instruments remaining in the individual states’ responsibility (fiscal policy, structural policy) are of crucial importance for safeguarding growth and competitiveness.

The Stability and Growth Pact represents the European framework for Austria’s fiscal policy. The Austrian government is committed to pursuing a sustainable budgetary and financial policy with a balanced budget over the business cycle, ensuring the possibility to react to cyclical fluctuations in an appropriate manner. The central government pays attention to the joint budgetary responsibility of all regional authorities within the terms of the Austrian stability pact.

A number of structural reforms, e.g. in the areas of energy supply, telecommunications, the promotion of research and development, in financial services or concerning improvements in competition policy, have strengthened Austria’s competitiveness in recent years. The Federal Government intends to further improve the structural framework within the next few years.
Long-term demographic trends pose new challenges to the sustainability of public finances. In light of an ageing population, safeguarding the financial stability of the pension and healthcare system is a challenge that has to be tackled now. The Federal Government has already taken important steps towards reform in the last few years (i.e. pension safeguarding reform 2003, promotion of private pension stock plans, renewed clearance). Further measures can be linked to these efforts.

• Stability Programme
• Structural Policy
• Sustainability of Public Finances

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