On 13th February, the European Commission published the 2009 'Joint Report on Social Protection and Social Inclusion'. Last Monday, the Report was examined by the EU Labour and Social Ministers; it will also serve as a basis for discussion at the Spring European Council taking place on 19th and 20th March. The core statement is that socio-political measures are a key instrument in combating the economic crisis.
Against the background of the tense labour market situation, the Report points out that social policy cannot only help to cushion the negative consequences of the economic crisis, but that it can also significantly contribute to the recovery of the economy. Social protection has an anticyclic effect and is regarded as an important automatic stabilisator. Good socio-political systems can contribute to stabilizing overall demand, strengthen consumer confidence and create jobs. In spite of the significance of social policy, the Commission restricts itself to coordinating national social policies within the scope of the “Open Method of Coordination”, which should enable Member States to learn from each other. The Report analyses the national strategies with regard to social inclusion, pensions, healthcare and long-term care.

Poverty and social exclusion
Data collected in 2007 shows that on average 16 % of Europeans are living below the poverty line, i.e. on an income, which is 60 % below the median income. An increased risk of poverty exists for children and older people (19 %). Even if a good job is still the best protection against poverty, the fact that on average 8 % of Europeans are poor in spite of having a job (“working poor”) is extremely problematic.

The poverty line in Austria lies at € 911. In 2006, 12 % of the Austrian population had to live on this or an even smaller amount. The highest risk of poverty in Austria concerns the unemployed (42 %), single parents (31 %), migrants from Non-EU/EFTA States (26 %), pensioners in one-person households (24 %) and disabled people (18 %). The rate of children and young people at risk of poverty in Austria lies at 15 %. In addition, 6 % of Austrians are at risk of poverty in spite of having a job. Austria needs above all measures to counteract the intergenerational transmission of poverty. Hereby, the improvement of educational and training opportunities of deprived young people is of vital importance.

The Report criticizes that differences still exist between socio-economic groups and regions concerning the state of health und life expectancy. The Member States are asked to use finances allocated to healthcare more efficiently, to reduce inequalities and to concentrate more on primary care, prevention and health promotion.
With regard to personnel and technical equipment, the Austrian health system has been rated as very good. As compared to international standards, Austria also shows a very high hospital density. The Commission, however, criticized that Austria belongs to the countries with the highest health expenditure in the EU. The total healthcare expenditure as a share of GDP was 10.1 % in 2006.

Retirement pension
In order to guarantee the sustainability of the pension systems, the Report demands that general working life will be extended and that the employment rate for older employees will be increased. The aimed at Lisbon target for 2010 is an employment rate of older employees of 50 %. A significant socio-economic divide was ascertained concerning the degree of coverage and the amount of the contributions with respect to private voluntary pension schemes. In other words, a private pension scheme is only affordable for a small part of society. It was also - if only briefly - mentioned that in view of the current financial and economic crisis the structure of a funded pension scheme system has to be examined.

In Austria, older people (65+) have on average a higher risk of poverty (14 %) than the overall population. This applies in particular to older women (18 %). The report rates the planned need-oriented minimum protection in Austria as positive, as this would significantly improve the situation of older people without pension entitlement.

Further Information:

Press release from the Commission

Proposal for the Joint Report on Social Protection and Social Inclusion 2009

Country specefic chapter about Austria (only in German available)