18 June 2003 • Occupational Pension Schemes in Austria • Thomas Url

Compared to Europe in general, occupational pension schemes are a relatively rare phenomenon in Austria. Whereas on a European average, every second worker is included in a form of occupational pension scheme, in Austria only one in six dependently employed workers can lay claims on a company pension. The WIFO study of schemes offered by participants of the regular WIFO business and investment surveys found that those companies that offer a pension scheme emphasise chiefly three motifs: improving the commitment of highly qualified employees, offering an incentive for better performance and meeting the desire of employees for a supplementary pension.

Altogether, some 31,000 companies (or 13 percent of Austrian enterprises) offered their staff an employee pension scheme in 2000. In the same year, about 430,000 employees (or 16 percent of all employees) had acquired a claim for a company pension, and 103,000 persons (or 11.5 percent of all old-age pensioners) received benefits from an employee pension scheme. In 2000, expenditure for contributions and net allocations to provisions was about Euro 745 million or 0.9 percent of the total wage bill. Benefits to retirees, i.e., payments from direct pension commitments, pension funds, group life insurance schemes and voluntary supplementary insurance within the public social security system, made up Euro 1,216 million, or 11 percent of the expenditure for old-age pensions paid by the social insurance system for employees. Provisions to cover direct pension commitments made up Euro 7.65 billion.

The incidence of employee pension schemes has surged since the last WIFO survey as of 1996. A change in the employment law for government employees of non-civil-servant status helped drive a development that is now spreading to provincial and local government levels. At the federal level, a pension fund is used to finance occupational pensions.

Vienna, 17 June 2003.

For further information, please refer to Mr. Thomas Url, phone (1) 798 26 01, ext. 279. For the full text of this article see the Internet under http://www.wifo.ac.at/