Austria budget deficit unites parties

ADRIAN BRIDGE

Central Europe Correspondent

After a row lasting more than six months - and one election later - Austria's two main parties kissed and made up yesterday with the announcement that, for the fourth time in succession, they would renew their left-right coalition government.

A relieved Franz Vranitzky, who remains chancellor, hailed the agreement between his Social Democrats (SPO) and the conservative People's Party (OVP) as a triumph for common sense and compromise. Wolfgang Schussel, the OVP leader and deputy chancellor, described it as "good news for Austria".

At the centre of the new agreement is a tough package of austerity measures designed to cut 100 billion schillings (pounds 6.5bn) from the country's spiralling budget deficit over the next two years.

In a bid to show they mean business, the coalition partners said they planned to cut two ministerial posts and reduce the number of state secretaries.

It was disagreement over how to reduce the budget deficit that caused the break-up last autumn of the last SPO-OVP coalition after less than one year in office. Although the SPO emerged strengthened from the December election that followed, the new cost-cutting economic policy bears the firm imprint of the OVP, which even flirted with the idea of throwing in its lot with Jorg Haider's extreme-right Freedom Party to ensure it got its way.

As part of the austerity package, designed to bring Austria into line with the Maastricht criteria for joining the single European currency, 10,000 civil service posts are to be axed by the end of next year, generous maternity leave payments are to be slashed and students up to the age of 27 will no longer be able to travel for free on public transport.

In a country that has got used to an astonishing degree of welfare cushioning, the prospect of the cuts has already provoked protests from trade unions, pensioners and students, thousands of whom this week teamed up with their university professors in declaring an indefinite strike.

Many Austrians, however, have recognised that, with the opening of the Iron Curtain in 1989 and entry into the European Union last year, the days of jobs for life and early retirement were destined to come to an end. "We have no option but blood, sweat and tears," said Anneliese Rohrer, political editor of the daily Die Presse.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Property Negotiator - OTE £20,000+

£16000 - £25000 per annum: Recruitment Genius: This family owned, independent ...

Recruitment Genius: Sales Administrator - Spanish Speaking

£17000 - £21000 per annum: Recruitment Genius: This is a fantastic opportunity...

Recruitment Genius: Sales Administrator - German Speaking

£17000 - £23000 per annum: Recruitment Genius: This is a fantastic opportunity...

Recruitment Genius: Sales Administrator - Japanese Speaking

£17000 - £23000 per annum: Recruitment Genius: If you are fluent in Japanese a...

Day In a Page

The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

Gaping hole at the heart of the European Union

Treatment of Greece has shown up a lack of genuine legitimacy
Number of young homeless in Britain 'more than three times the official figures'

'Everything changed when I went to the hostel'

Number of young homeless people in Britain is 'more than three times the official figures'
Compton Cricket Club

Compton Cricket Club

Portraits of LA cricketers from notorious suburb to be displayed in London
London now the global money-laundering centre for the drug trade, says crime expert

Wlecome to London, drug money-laundering centre for the world

'Mexico is its heart and London is its head'
The Buddhist temple minutes from Centre Court that helps a winner keep on winning

The Buddhist temple minutes from Centre Court

It helps a winner keep on winning
Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'