Wolfgang Schüssel: Encyclopedia II - Wolfgang Schüssel - Policies

Wolfgang Schüssel - Policies

The government's attempts at achieving a balanced budget (called "Nulldefizit") — while being more successful than similar attempts in some other European countries — have failed. Some of the effect was reached by raising taxes and fees, but quite significant cost-cutting measures were undertaken, many of which caused significant criticism. For example, the Austrian education system has suffered considerably, as is shown by the PISA study released in 2004. Costs are being cut at universities, even though the government proclaims that it will bring teaching and research to a "world-class" level. Cost-cutting in the security sector is blamed for an increase in crime.

At the same time, Schüssel's government increased public spending in certain areas. For example, the new "Kindergeld" (children money) to help families replaced the old "Karenzgeld", which was dependent on the recipient standing in employment. This change was a nod to a Freedom Party, which had campaigned for this measure.

The decision to replace the old Draken fighter planes of the Bundesheer with 18 Eurofighters (originally 24 were ordered, this number was reduced after the 2002 floods) was seen as waste of money by the opposition, most of all because of the attempts to save money in almost every area of the public administration. The government's arguments for this was that the Austrian State Treaty, according to which Austria needs to be able to defend herself, is to be read to imply that Austria must be in complete control of her air space. The opposition argued that this goal could have been reached in a much cheaper way.

Starting from around 2030, the unfavorable structure of the population pyramid will create a ratio of active to retired workers of 1:1. Schüssel's pension reform has led to reduction of future pensions and at the same time a raising of the retirement age. Schüssel's reform of the Austrian pension system is more broad-sweeping and thus more likely to be effective than all previous reforms in this area combined. However, experts insist that it should have been still more ambitious, but despite of this fact the SPÖ and the Austrian Federation of Trade Unions (ÖGB) protested heavily and argued that the pension losses, limited by Schüssel to 10% and later reduced to 5%, were excessive.

Recent efforts to reform the military and to create a uniform pension system are proceeding. One result of the military reform is by many hoped to be a reduction of the mandatory military service to six months, or even an abolition of military service. From 2005 onwards, corporate tax will be reduced to 25%, which is hoped to stimulate investment and economic growth. The measure is thought to be necessary, as neighboring countries which recently entered the EU, such as Slovakia, have even lower tax rates. However, critics sometimes argue that such a tax advantage for firms is unfair to other tax payers (the highest tax bracket for personal income tax is 50%) and may even be unconstitutional.

Adapted from the Wikipedia article "Policies", under the G.N U Free Docmentation License. Please also see http://en.wikipedia.org/wiki