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Austrian Reform Programme for Growth and Employment

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					                                                                        (final)




                       Austrian Reform Programme
                                   for
                        Growth and Employment

                                          Part I




     Sustainability            Employment                Location




     Education             Research & Development          Innovation




    Infrastructure              Social Security     Public Finances




       Women                        Environment        Youth & Family




Vienna, October 2005
Contents




Part I:     Austrian Reform Programme for Growth and Employment

            1.   Introduction
            2.   Situation
            3.   The seven strategic key areas
            4.   Summary


Part II:    Manual: Integrated Guidelines


Part III:   Detailed Comments




                                                                  2
  1. INTRODUCTION

Austria is a small, open economy. As such it is particularly affected by interaction with the
world economy. Austria's decision ten years ago to join the European Union was a good
decision and the right decision. However, more still needs to be done and Austria must, of
course, be continually repositioning itself and defining its role in the international system
accordingly. Austria has to find solutions that are right for the times to meet the major
challenges of today. It therefore supports the European Union's growth and employment
initiative and shares the view that a large number of tailor-made national growth
programmes, backed up by a Community growth and employment programme, can give a
considerable boost to growth in Europe.

The concerns that drive the "partnership for growth and employment" are not actually new
and have long been part of the realities of economic policy in Austria. Very many of the
reform measures of recent years have been taken entirely with a view to growth and
employment and financial sustainability. The first National Reform Programme is being
drawn up in the final year of the current government’s term of office. In other words, many
of the measures presented here follow on from the reform initiatives launched in previous
years. The National Reform Programme’s watchwords are continuity and sustainability.

The reform process was launched in May 2005 as part of a dialogue on reform involving
not only the Federal Government, social partners and the opposition, but also
representatives of the Länder, science and industry. During a lengthy discussion, the core
areas were identified and the foundations laid for the actual drafting of the national reform
programme. It was expressly emphasised that framework conditions must be established
making it possible for business and industry to safeguard jobs or to expand their
workforce: in the infrastructure area, an additional EUR 300 million is being made
available. By 2010 the research action plan will receive an additional EUR 1 billion in
direct and EUR 0.3 billion in indirect research aid. To promote technology, the Federal
Government will be increasing the existing broadband initiative by EUR 10 million. The
programmes for skill enhancement and for combating youth unemployment will be
expanded substantially. In order to give a stimulus to the building and construction
industry, authorisation procedures are to be speeded up, particularly in the case of power
stations and networks. Measures to combat organised black labour are being stepped up
and the successful export strategy and internationalisation initiative continued.

The present National Reform Programme comprises three parts: Part I describes the
strategic orientation of the Austrian Reform Programme for Growth and Employment. Part
II gives an overview of new measures to be implemented, mainly in 2005 and 2006. Part
III provides detailed information on the individual measures.

Attention is also drawn to the following links, where more information and details of key
areas of policy and measures can be found:




                                                                                            3
National Action Plan for Innovation:
http://www.bmwa.gv.at/BMWA/Themen/Wirtschaftspolitik/Technologie/Innovationsp
olitik/111_plattform_innovation.htm

European Charter for Small and Medium Enterprises:
http://europa.eu.int/comm/enterprise/enterprise_policy/charter/charter2005.htm

National Action Plan for Social Inclusion: www.bmsg.gv.at (see chapter on
„Fachbereiche/Sozialpolitik/Soziale Eingliederung (NAP)“

Pension    Strategy   Report    2005:    www.bmsg.gv.at       (see   chapter     on
„Fachbereiche/Sozialversicherung/Strategieberichte“)

European Pact for Youth: www.jugend.bmsg.gv.at

Implementing Strategy „i2010“: http://www.bka.gv.at/informationsgesellschaft

Austrian Research and Technology Report
http://www.rat-fte.at/UserFiles/File/Strategie2010.pdf

Position Paper 2010 of the Council for Research and Technological Development
http://www.bmbwk.gv.at/medienpool/12586/ftb2005.pdf




                                                                                 4
  2. SITUATION

The Federal Government has in recent years - despite an unfavourable climate - managed
to achieve much in consolidating the economy and safeguarding prosperity. Even if
comparison with other EU Member States confirms Austria's success in these respects,
now is not the time to call it a day. Reforms under way must be systematically pursued
and, where necessary, adjusted and corrected to reflect any new policy shifts.

The economic packages 1 and 2 (December 2001 and September 2002) as well as the
2003 Growth and Business Location Act have each been in response to the gloomier
economic environment and include a wide range of fiscal and other – mainly long-term,
supply-side – measures that have had stabilising effects on the economy and on
employment. The two economic packages were centred on economic policy incentives
that strengthened in a sustained manner the competitiveness of Austrian firms and, in so
doing, helped to enhance the attraction of Austria as a business location.

The Federal Government's aim is to put public finances back on an even keel by pressing
ahead with the reform of functions and expenditure. To do this, it is employing a threefold
strategy:

   (i)     Achieving a balanced budget over the economic cycle

   (ii)    Reducing the total tax ratio to 40% by 2010

   (iii)   Increasing growth potential by stepping up future-oriented investment (in
           research, education and infrastructure)

The focus of macroeconomic policy is on creating a cyclically appropriate, transparent and
sustainable basic environment as a prerequisite and support for an effective growth and
employment strategy that also attaches the greatest importance to avoiding any policy that
would be at the expense of later generations. In the last five years, the Federal
Government has brought in comprehensive structural reforms, especially in the areas of
public budgets, privatisation, administration, pensions, health and taxation, the aim being
to make the economy as a whole more efficient and, at the same time, to ease the burden
on the Federal budget. As part of the spending reform, wide-ranging structural
improvements were made in public administration and a modern, citizen-friendly system of
administration was set up. While core tasks were defined, the administration had still to
give the lead. On the one hand, the public sector was made much more efficient and
effective while, on the other, costs were cut by reducing the number of established posts.
The 2004/05 tax reform is boosting private disposable income, thereby helping to increase
purchasing power and easing appreciably the burden on workers and families.

Compared with the rest of the EU, and despite the unexpectedly long period of economic
weakness in recent years, Austria is still in a very good position. In terms of per capita
GDP (at 2004 purchasing power parities), it is ranked third behind Luxembourg and
Ireland. The forecasts by the Austrian Institute for Economic Research (WIFO) assume
that economic growth in Austria in the short and medium term will be stronger than in
Germany and Italy but weaker than in the new Member States and the economic nucleus
of northern Europe. The medium-term growth forecast rate of 2.3% (2003-08) is alone not



                                                                                              5
sufficient to reduce unemployment significantly. Against this background, the Federal
Government has embarked on reforms that positively influence the growth dynamic.


Table 1: Key indicators for the Austrian economy

                                             2000 2001 2002 2003 2004 2005 2006
                                                   Change on previous year (in %)
GDP-growth                                     3.4  0.8   1.0   1.4    2.4    1.7 1.8
Employment                                     1.1  0.4 -0.5    0.2    0.7    0.9 0.9
Inflation (HCPI)                               2.0  2.3   1.7   1.3    2.0    2.3 2.0
Total wages/salaries                           3.4  1.9   1.8   2.2    2.5    3.4 3.7
                                                           in % of GDP
Budget deficit                                -1.5  0.1 -0.4 -1.2 -1.0 -1.9 -1.7
Current account balance                       -2.5 -1.9   0.3 -0.5     0.3    0.5 0.4
Export rate                                  45.4 47.8 48.7 48.4 51.0 51.9 53.1
Source: Statistik Austria, WIFO, Eurostat, BMF



Austria's initial position is a thoroughly healthy one: it occupies the middle ground in
Europe as regards labour productivity per employee. It is however particularly positive
here that a growth in productivity has been noted continuously since 1990 and that the
pace of productivity in the overall economy and particularly industry is above the average.

The employment rate in Austria is higher than the average. With 67.8% in 2004, Austria is
well above the 63.3% average for the EU-25 but also the 64.8% average for the EU-15.
For overall employment, the "Lisbon target" of 67% was thus achieved in 2005 and the
goal of 70% in 2010 is in sight. The employment rate for female workers was 60.7% in
2004; here too the "Lisbon target" of increasing the employment rate for women to 60% by
2010 has already been achieved. In the case of employment of older workers, the EU has
set itself the goal of achieving an employment rate of 50% by 2010. In Austria, the
employment rate of older workers in 2004 was 28.8%. Measures have already been taken
to improve this situation, which is disappointing on an EU comparison; they include a
reduction in non-wage labour costs for older workers and the 2003 and 2005 pension
reforms.

The unemployment rate in Austria was 4.8% in 2004. This is quite far below the 8.0%
average for the EU-15.

In the case of Austria, the three indicators of social cohesion are particularly favourable.
The proportion of individuals with an equivalised disposable income below the poverty
threshold is comparatively low in Austria. The country ranks fifth among the 25 EU
Member States as regards the poverty risk rate. The employment ratio is balanced
between regions, while the long-term unemployment rate is 1,2% in Austria compared with
an EU-25 average of 4.1%.

Austria is also very well placed in the area of innovation and research. It has been
possible to continuously increase expenditure on research and development in recent
years. In 2003 it accounted for 2.19% of GDP, for 2004 it is expected to reach 2.27% and
in 2005 as much as 2.35% of GDP.




                                                                                              6
Table 2: Structural indicators


                                                              Austria   EU-25    Year

GDP per capita in PPS                                         122,0     100      2004
Productivity                                                  104,9     100      2004
Employment ratio*                                             67,8      63,3     2004
Employment ratio of older workers*                            28,8      41,0     2004
Highest level of education reached by young people (20-24)*   86,3      76,7     2004
Expenditure on research and development                       2,22      1,95     2003
Comparative price levels                                      107,2     100      2003
Enterprise investment                                         19,9      17,1     2004
At-risk-of-poverty rate*                                      13                 2003
Long-term unemployment rate*                                  1,3       4,0      2004
Spread of the regional employment rate*                       2,9       13,0     2003
Emissions of greenhouse gases                                 26,6               2003
Energy intensiveness of the economy                           150,53    209,94   2003
Volume of goods transport                                     118,5     99,7     2003
 Indicators broken down by sex
 Source: Eurostat, as at 30 September 2005



  3. THE SEVEN STRATEGIC CORE AREAS

Raising an economy’s growth path is a demanding and complex task. There are no quick
fixes. Only a strategy that has been designed for the long term and is pursued in a
consistent fashion can affect growth on a lasting basis. In addition, it should be borne in
mind that reform measures are all the more successful if they are carried out in association
with similarly dynamic countries.

Any measures designed to boost growth must not lose sight of the long-term consolidation
of public budgets that is needed. The sustainability of public finances is thus the backbone
of the Austrian growth strategy.

The macroeconomic context of the Austrian national economy has in recent years been
largely free of difficulties (see Table 1). GDP growth is above the average for the Euro-
area, the public deficit well below, the current account has since 2002 been more or less
balanced, inflation remains at the lower limit of 2%, wages per capita are evolving at a
moderate pace and the export rate is tending to rise.

Against this background, the Austrian Federal Government has identified in its national
reform programme the following seven strategic core areas, not only for promoting growth
and employment but also for improving competitiveness:

1. Sustainability of public finances

2. Labour market and employment

3. Research and development, Innovation

4. Infrastructure (including broadband)




                                                                                            7
5. Competition and SME action plan

6. Education and further training

7. Environmental technologies and efficient management of resources


As regards the detailed formulation of the seven core areas, the national reform
programme sets out to incorporate the contents of the 24 guidelines and to ensure that the
three areas (macro policy, micro policy and employment policy) closely dovetail with one
another so as to maximise the synergistic effects. Part II of the national reform programme
gives a rough outline of new measures (which will become effective mainly in 2005 and
2006) as well as of the linkage between the individual guidelines. In addition, it attempts to
demonstrate how the guidelines interact.

Account will be taken of the specific regional characteristics at provincial level, of
differences between urban and rural areas and of special characteristics in the border
regions. Depending on the resources available and the tests to be met for receiving
assistance, the EU Structural Funds already help to finance measures by the Federal
Government, the provincial authorities, the municipalities and the social partners (see
Guidelines 7, 8, 10, 11 and 15). In the EU financing period 2007-13 the degree of
consistency between cohesion policy and the Lisbon Process (at EU level) and between
the programmes under the Structural Funds and the national reform programme (in
Austria) is to be further improved. The present reform programme is, therefore, tailored to
the national strategic framework plan for Austria (STRAT.AT) for the period 2007-13 that is
now being drawn up and will be formally adopted once the legal bases at EU level have
been determined.

Table 3: EU-Structural Funds in Austria 2000 – 2006 – Regional programmes of
        Objectives 1 und 2. Expenditure of the European Regional Development
        Fund (ERDF) according to the categories in the Integrated Guidelines

Guideline                           Plan entire period         Payments 2000 to 08/2005

                              in Mio. Euro        in %         in Mio. Euro    in %
Guideline 7                           123,9               14            56,2           13
Guideline 8                            15,7                2             3,2            1
Guideline 9                            15,6                2             1,9            0
Guideline 10                          386,9               44           219,4           50
Guideline 11                           97,0               11            46,6           11
Guideline 15                          224,3               26           108,3           25
Guideline 16                            7,6                1             0,7            0
Guideline 24                            5,0                1             0,3            0
                                      875,9              100           436,6          100
Source: BKA, IV/4



CORE AREA 1: SUSTAINABILITY OF PUBLIC FINANCES
Since 1995, public expenditure has been reduced from over 57% of Gross Domestic
Product to less than 50% through reforms in the social networks and new public
management. Starting with a balanced budget in 2001 and a debt ratio of 67% of Gross
Domestic Product, several growth, employment and business location packages as well


                                                                                             8
as, in 2004-2005, the most extensive tax reform since 1945 have been implemented. This
resulted in a temporary rise in the budget deficit while the debt ratio fell to less than 64%.
It is expected to fall further as a result of additional spending cuts and an improvement in
the quality of public finances in terms of future-oriented expenditure.


Figure 1: Expenditure rate and budget balance since 1995




   2                                                                                        60


   0                                                                                             Right scale:
                                                                                            55   Public spending
                                                                                                 in % of GDP

  -2

                                                                                            50   Left scale:
  -4                                                                                             Maastricht balance
                                                                                                 in % of GDP


  -6                                                                                        45
        1995

               1996

                      1997

                             1998

                                    1999

                                           2000

                                                  2001

                                                         2002

                                                                2003

                                                                       2004

                                                                              2005

                                                                                     2006




Source: Statistik Austria, BMF



CORE AREA 2: LABOUR MARKET AND EMPLOYMENT
A major contribution to improving the employment situation and to reducing the
unemployment rate is being made by stepping up the rate of sustainable growth in the
economy. In addition, measures with a direct impact on the labour market are necessary in
order to improve the swift and effective matching of job seekers and job vacancies. These
include measures involving the Public Employment Service (placement and training),
measures to enhance flexibility and security, support for older active workers and
vocational reintegration aid. In implementing the measures, account is taken of regional
problems and the needs of functional – and overlapping – labour market regions.

An effective safety net encourages individuals to be more flexible – greater flexibility is the
key to exploiting growth potential – faster growth creates more jobs. Measures taken
recently to modernise the basic labour market arrangements and the Public Employment
Service in Austria enhance labour market flexibility. Measures to strengthen social
cohesion, such as initiatives to make family life and working life more compatible, add to
the necessary degree of flexibility, resulting ultimately in “Flexicurity”. The social partners
in Austria will be fully committed to promoting more flexible working time.

A comprehensive pension reform for older active workers was launched in 2004. A
selective programme covering the period 2005-07 for employees over 40 and job seekers



                                                                                                                      9
over 50 is designed to provide increased support for vocational reintegration and
(re)training and to promote age-related job placement and work organisation.


Table 4: Resources allocated to persons aged 45+ (active and activating labour-
         market policy)

                                            2001              2002              2003      2004

                                                          in Mio. €

Qualification                               72,4               70,1              84,2     57,1

Employment                                  77,2               51,5              65,6     65,1

Support                                       8,5               7,1              10,8       8,9

Activating AIV benefits*                    31,6               36,4              44,7     58,1

Funds for part-time working                 69,4             230,3              417,3    563,5
by older workers

TOTAL                                      259,1             395,4              622,6    752,7

Change in %                                                  + 52,6             + 57,5   + 20,9
* Excluding social security contributions; calculation: recipients x daily ratet
Sources: BMWA, AMS DWH

The measures to combat bogus self-employment and black labour are being stepped up.
On 28 September 2005 the Austrian Parliament adopted the Employment Promotion Act
with the support of all parties represented. The package offers training and employment for
more than 60 000 additional individuals, an increase of 20% over 2004. Overall, the
Government is investing an extra EUR 285 million under this training initiative in an active
labour market policy, thereby increasing the budgetary resources of the Public
Employment Service (AMS) by more than 30%. The key objectives of the training initiative
are measures to promote training in the care and health professions, the youth training
programme (Jobs for You(th)), the bonus for increasing the number of apprenticeships, the
possibility for those who have left school to take the school-leaving examination at a later
date (secondary stage I), a training action plan for women, the reintegration allowance for
women returning to the labour market and the “combi-wage”(a state-subsidised wage -
Kombilohn).


The measures taken under the European Social Fund (ESF) and the Community EQUAL
initiative provide back-up for the labour market objectives. For the period 2000-06 ESF
resources totalling EUR 761 million are available to Austria: they are allocated to three
programme objectives and to the Community EQUAL initiative.




                                                                                                  10
Table 5: ESF programmes 2000 to 2004 – Progress of implementation

Target programme/             Overall budget              Expenditure        in %
Community initiative            2000 – 2006               2000 – 2004
Target-1-Burgenland                    85.028.589               45.235.156   53%
Target-2-Kärnten                        8.800.892                3.203.573   36%
Target-2-Steiermark                    54.755.762               22.857.259   42%
Target-3-Austria                    1.306.129.673              832.133.284   64%
EQUAL-Austria1                        207.602.486               87.938.658   42%
TOTAL                               1.670.317.402              983.023.289   60%
Expenditure covers only the first round of applications
Source: BMWA




CORE AREA 3: RESEARCH AND DEVELOPMENT, INNOVATION

For growth in advanced industrial countries, innovations, not only technical but also social
and organisational innovations, play a key role. For Austria, reinforcing research and
innovation is particularly important since, until now, the share of value added accounted for
by technology- and knowledge-intensive products and services has been relatively small
for a high-income country. Such products and services are not only the best basis for
creating long-lasting competitive advantages but are also associated with above-average
growth potential and give impetus to productivity trends in other areas of the economy.

Devoting 2.5% of GDP to research in 2006 and 3% in 2010 is a quantitative objective that
performs an enormously important signalling function for the status of Austria as a
business location. The launch by the Federal Government of the Research billion
initiative (Forschungsmilliarde) in the spring of 2005 underscores the determination of
economic policymakers to further develop Austria as a location for innovation. The focus of
research and innovation policy is generally on improving research and innovation
performance and increasing the effectiveness of the overall national research and
innovation system. The aim is to step up research and innovation activities in the university
and non-university research sector and in the business sector, to extend technology and
know-how transfers, to promote national and international research, technology and
innovation cooperation, to increase the number of technology-oriented start-ups, to
improve innovation output and to exploit firms' development and growth potential.




                                                                                          11
Figure 3: Research expenditure in % of GDP


                                 2.50



                                 2.00
   Research ratios as % of GDP




                                 1.50



                                 1.00



                                 0.50



                                 0.00
                                        1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

                                              Fed. state & regions   Business sector   Foreign investments   Other




Source: Statistik Austria

CORE AREA 4: INFRASTRUCTURE
Measures to boost infrastructure investments have a twofold effect: first, they raise
demand in the economy as a whole, a welcome development particularly at a time of
insufficient private investment demand. Second, they improve competitiveness and
increase growth potential. An effective and flexible supply of transport services acts as a
major competitive factor, especially at international level. The Federal Government thus
adopted in May 2005 a further infrastructure initiative (Intrastrukturoffensive) with
additional funds of EUR 300 million.

However, despite these additional resources, the limits to public financing are clear to see
here too. The development of further PPP (public-private partnership) models can
contribute to faster completion of transport infrastructure projects. Given Austria's
geographical location, the main emphasis is on building up and extending transport links to
Central and Eastern Europe and constructing the Brenner base tunnels.




                                                                                                                     12
Figure 4: Increasing investment in rail and road infrastructure

  45
                                               40,5
  40

  35
                                +96%
  30                                          19,6
  25               20,7                                          Schiene
  20                                                             Asfinag & B-Netz

  15
                   12,5
  10                                          20,9
   5
                    8,2
   0
                1985 bis 1999              2000 bis 2014


Source: BMVIT



Information and communication technologies with innovative services and applications
have greatly affected and improved daily life. This means that ever increasing amounts of
data have to be transmitted more and more quickly. Broadband infrastructure enables
the knowledge-based society to keep up with this increasing need for information in an
easier, more convenient, and cheaper way. The use of modern information and
communication technology accounts for 40% of the increase in productivity. The
continuation of the broadband initiative (Infrastrukturinitiative) decided on in May aims
above all to improve the provision of broadband in areas where it is underprovided or
absent.


CORE AREA 5: COMPETITIVENESS AND SME ACTION PLAN
Promoting economic growth by improving competitiveness includes measures to foster
business start-ups and to attract new firms (e.g. procedural initiative;
Verfahrensoffensive – to speed up administrative procedures), to attract or to expand
business headquarters, and to improve business financing. An essential feature here is
the Regional Employment and Growth Initiative 2005/2006 (Regionale Beschäftigungs-
und Wachstumsoffensive) , which was adopted only in the summer of 2005 and has a total
budget of EUR 1.18 billion (i.e. equivalent to some 0.5% of GDP) for areas eligible for
regional assistance and for SMEs. By the end of the EU assistance period, which is
approaching, this initiative will offer firms incentives to invest and to create jobs.

Another keystone for promoting competitiveness is undoubtedly the 2004/2005 tax reform.
In addition, measures such as the internationalisation campaign "Go International" or the
package of measures under the "Entrepreneurship Initiative" are helping to further
secure Austria’s position as a global player.




                                                                                        13
Alongside the start-up initiative (Gründungsoffensive), the main element in the
sustainable increase in competitiveness is national measures in the area of better
regulation.

Figure 5: Enterprises set up from 1994 to 2004
   35000
                                                                                                29740
   30000                                                                                28322
                                                                        26035   25828
                                                                23762
   25000                                21706           21954
                                19843           19772
   20000
           14306       14161
   15000

   10000

    5000

       0
               1994    1995      1996    1997   1998    1999    2000    2001    2002    2003    2004


Source: WKÖ



Austria is also making energetic efforts to attract foreign direct investment. It the Austrian
Business Agency (ABA), the Republic of Austria has a consultative body that advises firms
investing on a transnational basis on labour-law and tax-law matters and provides
information on Austria as a business location.


Figure 6: Businesses implanted from 2000 to 2004, number of projects carried out
          through the ABA


    140          132
                               120
    120                                                     107
    100
                                                  82
      80                                 74
                                                                         Number of projects
                                                                         carried out
      60
      40
      20
       0
                2000          2001      2002    2003       2004
Source : ABA




                                                                                                        14
CORE AREA 6: EDUCATION AND FURTHER TRAINING

The quality of human capital has a direct influence on competitiveness and is also the
basis for the ability to carry out technical, social and organisational innovations.
Knowledge, qualifications and innovative action are - together with research and
development and infrastructure - the most essential factors in achieving a long-term
dynamically growing economy.

In addition to initial training, further vocational training is becoming increasingly important
for Austrian competitiveness. Technical know-how and the skill required in an economy
are rapidly changing. Austria is attempting to tackle these challenges by way of a very
diverse set of measures to improve the quantity and quality of training and further training.

As for developing a consistent strategy for Lifelong Learning by 2010, an internal expert
working party has produced a working paper as a contribution to the policy preparations
for this strategy. The best ways of preventing unemployment is to train and constantly
retrain the Austrian labour force. To this end, the principle of “Lifelong Learning” is being
made an integral part and institutionalised in as many areas as possible.

The Public Employment Service, schools and non-school educational and training
institutions will provide the training modules needed. Special importance should be paid to
the possibility for school leavers to take the school-leaving examination at a later date. The
modularisation of vocational training adopted by Parliament in July 2005 is designed to
make it possible for more firms to take on apprentices. It should also create in the field of
vocational training the conditions necessary for closer integration between initial training
and further training. The apprenticeship initiative (Lehrlingsoffensive) addresses this
very point.

With the 2002 higher education reform, which entered into force on 1 January 2004, a
major impetus was given to modernisation of higher education, with special attention being
paid to university independence. Alongside this, study courses at technical colleges were
set up as independent back-up and alternative to existing courses available at universities.
The vocational and practical training offered by higher education attaches special
importance to the adacemia/business interface.




                                                                                            15
Figure 7: Number of pupils leaving school early without any subsequent further
          training 2004 (in %)
  %
  50

  45

  40

  35

  30

  25

  20

  15

  10
                                                          14,2

                                                                   14,9

                                                                            12,9

                                                                                       22,3

                                                                                                 15,6




                                                                                                                                           14,5




                                                                                                                                                                                39,4
                                                                                                                     17,0




                                                                                                                                                                                                                              31,1



                                                                                                                                                                                                                                                             12,6

                                                                                                                                                                                                                                                                       16,8

                                                                                                                                                                                                                                                                                18,4
   5
       11,9



                              12,1

                                       13,7




                                                                                                         9,5




                                                                                                                                                           8,7

                                                                                                                                                                      5,7



                                                                                                                                                                                              8,6

                                                                                                                                                                                                       7,1
                                                8,7




                                                                                                                                                                                                                  4,2



                                                                                                                                                                                                                                        Czech Republic 6,1
                 8,1




                                                                                                                                   45
   0

                                                                                                                     Luxembourg*




                                                                                                                                            Nietherlands
                            Germany




                                                                                                         Lithuania
                  Denmark




                                                                                                                                                                                                                   Slovenia
                                                                                                                                                                                                       Slovakia




                                                                                                                                                                                                                                                             Hungary
                                                                                                                                                                                   Portugal
       Belgium




                                                                                                                                                                                              Sweden
                                      Estonia




                                                                   Greece
                                                Finland




                                                                                                                                                                                                                                                                              Cyprus
                                                          France




                                                                                                                                                            Austria

                                                                                                                                                                       Poland
                                                                             Ireland



                                                                                                Latvia




                                                                                                                                                                                                                                Spain
                                                                                                                                   Malta
                                                                                        Italy




                                                                                                                                                                                                                                                                       UK
Source: Eurostat



CORE AREA 7: ENVIRONMENTAL TECHNOLOGIES                                                                                                                                  AND EFFICIENT                                               MANAGEMENT                                        OF
             RESOURCES
Austria is a world leader when it comes to its policy on the environment and sustainability.
This high environmental standard brings with it enormous growth and export potential.

The promotion of renewable energies and the improvement of energy efficiency are
important goals of the Federal Government of Austria.

Environmental technologies play a key role in ensuring sustainable development. The
potential they offer should be exploited more intensively in order, on the one hand, to meet
ecological challenges and, on the other, to improve competitiveness and growth. With the
Environmental Technology Action Plan (ETAP), the most important conditions were set in
place for the further development and dissemination of environmentally friendly
technologies, products and services. The ETAP comprises a series of quite practical
measures such as the creation of a data bank for environmental technologies, a tendering
procedure for pilot projects to set up technology platforms, participation in the setting of
performance target for production processes and services, the carrying out of studies on
promoting sustainable production and consumption patterns, and assistance in promoting
the ETAP at international level.

A dialogue between business, academia and civil society is set to define reduction and
decoupling targets for promoting resource efficiency and to design guideline measures for
achieving those objectives. Appropriate monitoring measures are also to be spelt out in an
Action Plan for improving resource efficiency.

As regards attainment of the Kyoto target for Austria, it should be mentioned that
emissions trading began on 1 January 2005 on a modern, smoothly functioning certificate
exchange.

                                                                                                                                                                                                                                                                                       16
Figure 8: Share of gross domestic consumption accounted for by renewable forms
          of energy in 2002

   50
   45
   40
   35
   30
   25
   20
   15
   10
    5
    0
                                                                                                                                                                                                                         Luxembourg
        OECD-Total




                                                                                                                                                                                                           Netherlands
                                             Switzerland




                                                                                                                                                                                                                                                                                         Germany
                                                                                                                                                Lithuania




                                                                                                                                                                                                                                                                                                   Denmark
                                                                                                         Slovenia
                                                                                                                    Slovakia
                                                                                     Hungary




                                                                                                                                                                                                Portugal




                                                                                                                                                                                                                                                                                                             Belgium
                                                                                               Czechia




                                                                                                                                                                                       Sweden
                                                           Norway




                                                                                                                                                                     Estonia




                                                                                                                                                                                                                                                                               Finland
                                                                                                                                                                                                                                                             Greece
                                                                            Cyprus
                             Austria




                                                                                                                               Poland




                                                                                                                                                                                                                                                                      France
                                                                                                                                                                                                                                              Ireland
                     EU-15




                                                                    Japan




                                                                                                                                                            Latvia


                                                                                                                                                                               Spain
                                                                                                                                        Malta
                                       USA




                                                                                                                                                                                                                                      Italy


                                                                                                                                                                                                                                                        UK
Source: IEA

  4. SUMMMARY

The National Reform Programme for Growth and Employment defines seven strategic
core areas in the economic policy sphere. The measures specified in those core areas are
assigned to the 24 guidelines. No single measure can on its own raise the growth path in a
sustainable and appreciable manner. Only through the combining and logical interlinking of
sets of measures can synergies be achieved which are powerful enough to trigger effects
that are positive for growth policy and strengthen confidence in growth and
competitiveness. The measures in the National Reform Programme, their implementation
and their impact will be regularly monitored in order to reap the full benefits of the growth
strategy in term of effectiveness.




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