Fekter: "My aim is to create stability for a secure future"
Press Release, 19 October 2011
“As Minister of Finance, I have one aim: I want to create stability so that our money keeps its value. We need stable finances for a secure future,” declared Dr. Maria Fekter, Minister of Finance, opening her first budget speech, adding that the upheavals and uncertainty of the past few years and months have “made people afraid that in future their savings may no longer have any value.”
Austria’s measures to combat the financial and economic crisis have secured jobs, purchasing power and the status of Austria, as well as savings deposits. In addition, new growth has been generated. “However, these measures have cost a lot of money, and from 2008 to 2010 increased the deficit by EUR 25 billion. This increase could only be sustained through a prudent budget policy on the part of the Austrian federal government, and successfully managed due to a sound economic basis,” stressed Fekter.
“I don’t want to be against something, but rather I want to fight for something”
In the coming weeks and months too, many European countries will be confronted with drastic measures due to the debt crisis. According to Fekter, these developments will bring populists from both the left and right into the arena, eager to blame the wealthy, the banks and above all the overall European project. “For me personally, it is not enough only to be against something, but rather I want to fight for something, and that is to secure our currency and the savings of all Austrians, to secure our prosperity as well as reduce the deficit. In so doing, we must always keep solid growth in mind; that is what we need for stable finances to ensure a secure future.”
“ Despite the economic downturn, we will keep on course and not leave the path of consolidation we have embarked upon,” stressed Fekter.
The Minister added that the situation in the employment market remained positive. “ At the end of September 2011, 3.48 million people were employed in Austria, an all-time high,” said Fekter, taking the opportunity to thank companies, employees, as well as employee and employer federations, for the positive employment climate. Fekter: “Austria currently has the lowest unemployment rate in the whole of Europe, at 3.7%. In 2012 too, consumer demand will remain stable and indeed grow slightly. Inflation will fall from 3.1% to 2.1%.”
Fekter believes that clear economic policy priorities are needed, based on an efficient government, a competitive economy, stable finances, a functioning capital market and an innovative, self-reliant society.
Guaranteeing stability and reliability
Stability and reliability are the most important premises as regards the work of the federal government. “We guarantee stability and reliability by ensuring that we discipline our expenditure through saving while at the same time reducing the deficit. The duty to ensure debt reduction would be enhanced if we created a constitutional provision for this and introduced the debt brake I have called for.”
The challenges faced when preparing the 2012 budget were already clear during negotiations over the Medium-Term Expenditure Framework for the years 2012 to 2015: through a solid and sustained budget policy, we aim to secure Austria over the long time as a financial and economic centre as well as meet EU targets. This is the only way, on the one hand, to reduce debts and open up future room for manoeuvre. On the other hand, the task is also to secure Austria’s positive position to date on the capital markets and thus to remain fit for the future. Maintaining our triple-A rating is not an end in itself, but rather, Austria’s sound credit standing gives us low interest rates. And it should remain that way, declared Fekter in her budget speech.
“ Expenditure for the sake of our children is the best investment in all our futures. There will not be a new austerity package for families. Education, academia and research will have a high priority over the coming year,” announced Fekter.
Fekter: “This year already, the aggregate government Maastricht deficit, at 3.6% of GDP, will be significantly lower than anticipated in the spring of 2011, when the forecast was for 3.9% of GDP. Likewise, the aggregate government debt ratio is better than expected; in 2011 it will be 72.4% of GDP, whereas originally we had expected it to be 73.6% of GDP. In the coming year, the aggregate government deficit for 2012 will fall to around 3.2% of GDP. The aggregate government debt ratio will be 74.6% of GDP.”
Offensive measures and future investment of EUR 400 million per year
Besides continuation of the consolidation path, the 2012 budget will also rely on offensive measures and future investment in the sum of EUR 400 million per year in the environment, research, universities, full-day school care provision and healthcare services.
Fekter added that it was important to make savings with regard to tough issues such as early retirement. “The measures already put in place in this regard and the proposals by employer and employee federations are heading in the right direction and must now be implemented with greater urgency,” she declares, referring to the reorganization of the so-called “ Hackler” rule (“ Hackler” being an Austrian slang term for a hard manual labourer; the rule regulates the pension settlement for certain categories of manual and long-term employees), the gradual increase in the pension age or the increase in additional payments for time spent in education in order to qualify for pension entitlement.
“I have a clear picture of how our country should be. I imagine a country with social peace, a high standard of living and a country of liberty in which people can be in charge of their own lives. This is what my financial policy is based upon – it creates stability, and is making Austria fit for the future,” concluded Fekter at the end of her budget speech.