ABSTRACT

Retrenchment or restructuring are attributes widely used in Europe to describe current welfare state developments. Austria is no exception. The Austrian welfare state is comparatively generous concerning social protection expenditure. In relative terms [28.8 per cent of gross domestic product (GDP) in 2005], it ranks sixth in the EU27. In absolute terms (€8573.4 per inhabitant), it even ranks fifth. Together with challenges arising from demographic changes and from the broader politico-economic context, this high level of statutory expenditure is at the core of current debates about the future of the Austrian welfare state. This chapter presents the Austrian welfare system by studying historical developments, identifying its major characteristics and discussing current trends. The first section of this chapter illustrates its roots, locates the Austrian system in the comparative welfare state literature, and introduces the role of public and private actors. Major welfare sectors are then described in more detail in the second section leading to an analysis of key features of the contemporary Austrian welfare system. Finally, the third section provides a brief conclusion and discusses future perspectives.