CAREER PUBLIC SERVICE PENSION
|CAREER PUBLIC SERVICE PENSION
In Austria, career public servants possessing permanent tenure of appointment (Pragmatisierung) in central, Land and local government have their own form of pension which is called Ruhegenuss (retirement pay) and regulated separately under the 1965 Pensions Act (Pensionsgesetz), outside the statutory pension scheme provided for under the General Social Insurance Act (ASVG). After 35 years' service, this retirement pay amounts to 80% of their final salary. In contrast to other public employees, who are covered by the general ASVG pension scheme, in the case of career public servants there is no earnings limit for chargeable contributions and hence no maximum pensionable earnings. Consequently, they pay contributions at the rate of 11.75% of their gross salary right up to the highest point on their salary scale, while under the ASVG scheme employees pay 10.25% only up to the chargeable income limit and their employers pay 12.55%. Allowing for notional ASVG-equivalent employers' contributions from the central, Land or local government authorities as their public employers, this means that in the special case of career public servants the coverage of pension costs from contributions (with the shortfall needing to be covered from the national budget) is 60%, as against 80% in the case of the ASVG scheme.
As a result of the fact that there is no pensionable earnings limit and that this “retirement pay” is calculated on the basis of final salary, together with substantial differences in the grading structure and greater influence on pay of the seniority principle, career public service pensions are, on average, almost three times as high as those received under the ASVG scheme. In the 1997 pensions reform it was decided that, as a move towards the harmonization of pension systems, pension provision for career public servants should gradually be brought into line with that for employees covered by the general ASVG system. Over the years up to 2018, the calculation basis for their “retirement pay” is to be changed, in stages, from the final salary level to the period used in the ASVG pension system (the best, i.e. with highest earnings, 15 years, extendible to the best 18 years in cases of early retirement). See also occupational pension scheme.))