Early retirement for civil servants to cut public employment

Despite protests from the opposition, in November 2001, Austria's coalition government obtained parliamentary approval for an early retirement scheme for federal civil servants . The aim of the scheme is to cut expenditure in the public administration by reducing the number of public employees by a total of 15,000 by the end of 2003.

On 21 November 2001, a second amendment of the 1979 Career Public Service Regulations Act (Beamten-Dienstrechtsgesetz) was approved by the Austrian parliament, thereby introducing a new Civil Servants Social Plan Act (Bundesbediensteten-Sozialplangesetz, BB-SozPG). The new legislation establishes a 'social plan' for civil servants, which includes an early retirement scheme for public employees. It forms part of an administrative reform package put forward by the coalition government of the populist Freedom Party (Freiheitliche Partei Österreichs, FPÖ) and the conservative People's Party (Österreichische Volkspartei, ÖVP) (AT0002212F). The objective of the legislative amendment is to reduce government expenditure through cutting staff numbers in the civil service by 4,000 over the period 2002-3. Overall, the government is seeking to reduce the number of federal public employees by 15,000 (or about 7%) during the course of its administrative reform.

The introduction of a new early retirement scheme required an amendment of the Career Public Service Regulations Act. While early retirement schemes for civil servants were introduced with regard to the staff of former state agencies in 1997 (AT9711147N), the government wished to extend the regulation to include the whole public service, in order to facilitate staff reductions.

Federal public employees

In Austria's public service, the employment relationship may be governed by either public law or private law. Those public employees who are employed under a public-law relationship with central government are called 'federal career public servants' (Bundesbeamte) and their employment relationship is regulated by the abovementioned Career Public Service Regulations Act.

Employees of central government who are employed under a private-law employment relationship are called 'contract public employees' (Vertragsbedienstete) and their employment is regulated by the 1948 Contract Public Employees Act (Vertragsbedienstetengesetz). Unlike the latter, federal career public servants enjoy permanent tenure of appointment (Pragmatisierung), which means absolute protection against dismissal. When they reach pensionable age, career public servants do not leave the public service but are transferred into a 'retirement relationship' (Ruhestand). The normal retirement age is the same as in the private sector: 60 for women and 65 for men.

Social plan for federal public servants

In order to achieve the government's targeted employment reductions in the public service, career public servants need to be offered incentives to participate in an early retirement scheme. Hence, the reform plan consists of four measures, as follows:

  • federal career public servants and contract public servants of 55 years and over are now entitled to make use of the paid leave for older employees (Alterskarenz) scheme, if their posts are to be deleted in the course of the administrative reform. They receive 80% of their former earnings until retirement (Vorruhestand);
  • an additional early retirement scheme enables civil servants aged 55 years and over to retire early, with their pension entitlement reduced by 4% per year of early retirement;
  • if a civil servant, whose post is to be deleted, voluntarily leaves the public service, he or she will receive a lump-sum payment worth nine to 12 months' pay; and
  • public employees seeking a career outside the public service are entitled to temporary unpaid leave, which includes the right to return to their position. The duration of the leave is at least one year and must not exceed five years.

The reform measures are valid for both federal career public servants and contract public employees. They entered into force on 1 January 2002 and will be in effect until 31 December 2003.

The government expects that each of the four measures will be accepted by 500 civil servants every year, resulting in a total reduction of public employees by 4,000 by the end of 2003.

Reactions

While the Civil Service Trade Union (Gewerkschaft Öffentlicher Dienst, GÖD) welcomes the coalition government's social plan for employees leaving the federal public service, it met with harsh criticism from the parliamentary opposition of the Social Democratic Party (Sozialdemokratische Partei Österreichs, SPÖ) and the Greens (Die Grünen, GRÜNE). The SPÖ's leader, Alfred Gusenbauer, argued that 'the social plan for civil servants is a socio-political scandal and the most expensive early retirement campaign in Austria's history: steelworkers may not retire until 65 while civil servants are offered incentives to retire at the age of 55.'

Members of the ÖVP coalition party also state that staff reductions could have also been achieved through, for instance, a release of surplus personnel through 'natural wastage'. Josef Pühringer, the governor of Upper Austria and the leader of the ÖVP in this federal state, stated: 'I do not wish to advise the government on how to reduce its federal public servants, but in Upper Austria we have successfully introduced a 10-year programme to cut staff in the public sector. It might have been reasonable to start the administrative reform earlier.'

Commentary

The social plan for public employees somewhat contrasts with the governments' general announcement on coming to power in February 2000 that it would raise the actual retirement age of civil servants and make early retirement less attractive in order to cut expenditure. Only one and a half years ago, the government agreed a far-reaching pension reform, which increased the entry age for early retirement for private sector employees from 60 years for men and 55 years for women to 61.5 years and 56.5 years respectively (AT0008228F). This provoked controversial debates. Although the need for staff reductions and an administrative reform is widely accepted by all political parties, the appropriateness of the governments' measures is highly contentious. (Susanne Pernicka, University of Vienna)

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Yeni yorum ekle