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Austria SOCIAL PARTNERSHIP
After World War II, the government, as well as industry and
the trade unions, realized that the country could not afford to
repeat the continuous social, political, and economic conflict
that marked the 1920s and 1930s, when the country moved from one
crisis to another until Adolf Hitler's Anschluss in 1938. They
wanted to avoid ruinous social and industrial conflict, strikes,
lock-outs, and the kind of persistent social battles that had
contributed to the paralysis of the Austrian economy and its body
politic during the interwar years.
To find a solution, the government and its political and
economic institutions reached back to earlier concepts that also
had an influence on Austrian thinking and Austrian history. One
was the papal encyclical Rerum Novarum of 1891, which had
envisaged a working class that would be gradually absorbed into a
property-owning class, not through social conflict but through
constructive social cooperation. Another was the Austrian
tradition of the Labor Advisory Council (Arbeitsbeirat), which
had functioned as a section of the Ministry of Commerce from 1898
to the outbreak World War I and which offered a model for the
pragmatic participation of the labor movement in the functions of
the state and the general direction of the economy.
After World War II, these concepts coincided with the
practical exigencies of the moment to force representatives of
social groups to work together to cope with the combination of
unemployment, inflation, and widespread poverty and misery. The
ÖGB and the reestablished business organizations of the three
main economic chambers played central roles in working out a
series of wage-price agreements between 1947 and 1951. Those
agreements, and the negotiations that led to them, were based on
a mutual recognition that no social group could benefit if it
imposed its demands at the expense of the collapse of the state
and its economy--a collapse that often seemed all too near in the
immediate postwar years.
The social partnership system works on the basis of a mutual
recognition of three principles. The first is that the three main
economic groups--industry, agriculture, and labor--will be
properly represented through four mutually recognized
organizations--the chambers of commerce, agriculture, and labor,
and the ÖGB--that represent their interests and that can take the
responsibility for decisions. The second is that economic
decisions can be legitimately made outside the ideologically
competitive political atmosphere of parliament, thus in effect
depoliticizing crucial matters related to the Austrian standard
of living. Third, the principle of consensus will function in
such a manner that no social group is ignored, and no social
group will prolong the struggle once an agreement has been
reached.
The core consultative instrument of the social partnership is
the Parity Commission. The commission consists of seven members
of the government--the chancellor, three ministers, and three
state secretaries--and two representatives each from the Federal
Chamber of the Economy, the Presidential Conference of the
Austrian Chambers of Agriculture, the Council of the Austrian
Chambers of Labor, and the ÖGB. This distribution of seats on the
commission gives the interest organizations a majority. Experts
in various areas attend the meetings in an advisory capacity. The
Party Commission's decisions must be unanimous, because the
commission is not based on law, and participation is completely
voluntary.
The Parity Commission began its work in 1957 on the basis of
an exchange of letters between the president of the Federal
Chamber of the Economy and the president of the ÖGB. Its original
purpose was to slow down a troubling wage-price spiral, but it
later expanded into much broader discussions on the general
trends of the European and Austrian economies and what would be
the best response to these trends. The commission has
subcommittees on wages and prices. In addition, the commission
includes the Advisory Committee for Economic and Social
Questions, which was established in 1963 to provide the basis for
an objective approach to economic policy and to conduct studies
required by the Parity Commission.
The Parity Commission, however, only deals with the central
questions of the economy. It establishes the general principles
for solving economic problems and disagreements. Below it, at the
industry level, the interest-group associations of the various
chambers or the trade unions negotiate the separate and legally
binding agreements governing employers or employees. The
agreements are reached on the basis of the broad principles and
criteria set by the Parity Commission.
Some forms of social partnership involve little or no
participation of government organs. The so-called selfadministration associations require the cooperation of interest
associations in such structures as social insurance institutions,
agricultural boards, labor-market bodies and tribunals, and in
other institutions where agreements between potentially
conflicting interest groups must be reached. Those institutions
more often deal with social than with economic questions, but the
participants in the negotiations usually evaluate the broad
economic situation and the policies agreed on in the Parity
Commission as they negotiate.
Beyond the mechanics of the Parity Commission and the bitter
memories of futile class conflict, however, other elements also
work to produce an atmosphere of cooperative consciousness. One
of these elements is the virtually universal recognition by all
Austrians that theirs is a small state and a small economy in a
world full of larger and potentially more competitive actors.
Austria cannot afford self-indulgence because it would
immediately risk its survival.
Another cause for cooperation rather than unbridled
competition is the large public and foreign ownership of Austrian
firms. At the beginning of the 1990s, state-owned firms
constituted a total of 32.8 percent of all Austrian companies,
and foreign-owned firms constituted an additional 25.1 percent,
leaving only about 35 percent in private hands, with an
additional 7 percent in scattered holdings.
The Austrian trade union movement is forced to moderate its
demands for wage increases because of the close affiliation
between the Austrian schilling and the German deutsche mark. The
stability policy of the German Bundesbank thus also has an effect
in Austria. Given this fact, the trade unions cannot usually
argue that runaway inflation threatens the standard of living of
the Austrian worker.
The social partnership has been successful in maintaining a
cooperative spirit and in avoiding industrial strife. After World
War II, for example, Austria had fewer strike-minutes lost per
worker than any major economy. In many years, there were no
strikes at all. However, there has been debate about whether the
social partnership and the work of the Parity Commission and
other bodies have impeded progress and if stability could become
stagnation. The danger exists that new production and
communications systems, as well as progressive organizational
structures, will not be introduced quickly and that the social
partners will find it convenient to protect established jobs and
processes rather than to revise or even revolutionize them.
Data as of December 1993
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