Austria’s unfair pension system: women get 41 percent less pension
Women receive 41 percent less pension than men - the difference in Austria is greater than almost anywhere else. The reasons for this: lower salaries, too few childcare places and consequently childcare times that are not counted.
In Austria, women receive around 41 percent less pensions than men. On average across OECD countries, women have 26 percent less pensions, with the difference being smallest in Estonia at less than 5 percent.
In numbers, this means that women’s pensions average EUR 1,239 and men EUR 2,103 gross. The difference is 41.06% or 150 days. In 2022, Equal Pension Day falls on August 3rd, the day on which men have already received as much pension as women will only receive by the end of the year.
The reason for this imbalance is the wage gap, because the wage is the basis for the pension amount. In addition, if mothers (or fathers) work part-time after the birth, this also brings less income, but it really only becomes important when you retire.
The pension gap is twice as wide as the income gap – despite the minimum pension and compensatory allowance.
Against the background of record inflation, this situation is particularly dramatic. "Especially now, with the enormous increase in prices, an average pension of just over 1,200 euros is a sheer mockery when you consider what women are still doing unpaid," says women’s spokeswoman Eva-Maria Holzleitner.
In addition, the Corona crisis hit women in particular: 85 percent of the Corona unemployed were women and the failure of kindergarten and school also hit women in particular .
POVERTY IN OLD AGE AFFECTS WOMEN IN PARTICULAR
Women often have such a small pension that they cannot live on it. Either they still have to work in old age, or – if this is no longer physically possible – they are stuck in poverty. The poverty line for a one-person household in Austria is 1,371 euros - and thus well above the typical women’s pension. The risk of poverty in old age is highest among single pensioners. In 2021, out of 232,000 people living in poverty in old age, 157,000 were women . AIn percentage terms, women are also more frequently affected: 178 percent of all women over 65 are at risk of poverty, for men it is 11 percent. Overall, there is a significant increase in pensioners living in poverty compared to 2020, with the increase in the risk of poverty among women being particularly large at 7.6%.
ONE REASON: THE PENSION CUTS BY THE ÖVP AND FPÖ IN 2003
But why is the difference between women and men when it comes to pensions in Austria so big, even compared to the OECD average? A major reason for the divergence of pensions is the ÖVP-FPÖ pension reform of 2003. Until then, the best 15 years were used as the basis for calculating the amount of pension. Since then, the entire working life has been taken into account for the amount of the pension - and years of childcare and part-time work have a particularly hard impact on women.
The black and blue pension reform was the second republic’s biggest pension cut, but it was primarily a cut in women’s pensions.
Women earn less for their work, but the difference only becomes really big when they retire.
Both the level of income and the number of years of contributions are relevant for the amount of the pension. Women fare worse on both factors. Because women have around 10 years less that are included as contribution years.
And: Last year, 4 out of 5 part-time positions were held by women. In other words, almost every second woman works part-time. This has consequences when women reach retirement age and is also reflected in the minimum pension and compensatory allowance.
WOMEN ARE PAID LESS – THAT TOO HAS CONSEQUENCES
But not only part-time jobs are the reason for the low pensions. Overall, it is the lower wages and salaries that women are paid.
Even when women work full-time, they are paid 20 percent less than men for the same work.
In addition, sectors in which many women work - such as social, educational and commercial sectors - are particularly badly paid. “In many cases, these are the crisis heroes who did so much in the Corona crisis!” says Holzleitner.
This means that the average gross annual salary for men is EUR 50,400, while that for women is only EUR 38,800. Incidentally, if women working part-time were also included, the salary difference would be as much as 40 percent .
FAR TOO FEW CHILDCARE PLACES
In addition, in many regions of Austria there is a lack of kindergartens and schools whose opening hours can be reconciled with the working hours of working parents.
But for many children under the age of 6 there is no childcare place in Austria that is compatible with a full-time job. One parent then has to work part-time or stay at home all the time - and these are mostly women because they earn less or because it corresponds to the role model. There is still no legal entitlement to all-day, nationwide children’s education.
It is largely women who do the unpaid work at home – also in 2022. This has to change in order for pensions to be adjusted.
"Men have to do half of the unpaid work, there’s no question about it. Men have to take on their part of the responsibility, be it in raising children, in the household or when elderly relatives have to be cared for," says Thomas Weninger, General Secretary of the Association of Cities .
SINCE 2019, WAITING PERIODS HAVE BEEN TAKEN INTO ACCOUNT IN THE JOB
But there are also improvements: For example, since August 2019 , maternity leave has also been fully recognized at work . This brings mothers faster salary increases and ultimately higher pensions. Eva-Maria Holzleitner from the SPÖ calls for better consideration here: There should be 50 euros per month on top of the employment pension if women have taken maternity leave and childcare periods. Holzleitner also calls for a general “big pension increase” so that everyone in Austria can still afford groceries given the current rise in prices. In addition, all-day childcare places throughout Austria should be free of charge, and the nursing profession should be classified as hard work, a legal entitlement to switch between full-time and part-time work and genuine income transparency.
https://kontrast.at/pension-frauen-weniger/