Pension insurance in Austria is a branch of social insurance. It covers risks related to old age, reduced working capacity and death. In addition to pension payments, pension insurance also covers rehabilitation and health care. Under the Allgemeines Sozialversicherungsgesetz (General Social Insurance Act) for employees there are three different types of pension insurance, the pension insurance for blue-collar workers, the pension insurance for salaried employees and the miners' pension insurance. Self-employed persons are also covered by insurance schemes, which are set out in a series of pension systems: GSVG (social insurance for business people), FSVG (social insurance for free-lance self-employed persons), NVG (insurance for notaries) and BSVG (social insurance for farmers).
The insurance relationship is established ex lege or, in the case of voluntary membership, by application for membership and/or contribution payments. This insurance is financed from contribution payments collected from the beneficiaries and employers and by a further contribution on the part of the Government. In order to secure long-term financing of this scheme a net adjustment scheme was introduced in 1993. Under the scheme the index-linked pensions are adjusted in line with the development of working incomes as far as this is economically feasible; measures included restricted qualification for early retirement pensions, new calculation of working years and incentives for later retirement, gradual increase of working years needed in order to qualify, inclusion of freelance and self-employed persons into the mandatory insurance scheme and accompanying measures on the job market in 1996 and 1997.
Old-age insurance covers old-age pensions, early retirement in the case of reduced working capacity, early retirement pensions in the case of unemployment, early retirement pensions in the case of long-term insurance and part-time retirement pensions. In cases of reduced working capacity the scheme covers disablement pensions, occupational disability pension and in the case of death, survivors' benefits.
Men can benefit from their old-age pension upon completion of the 65th year, women upon completion of the 60th year. Retirement ages are to be harmonised gradually by 2033.
In 1997 3,038,070 insurance relationships existed in Austria (2,603,181 employees and 434,889 self employed); this number showed an increase of 10.1% as compared to 1987. The number of pensioners increased by 1,894,025 (14.1.%) from 1987-1997 (1,549,731 employees and 344,294 self employed recipients).
Civil servants in Austria are not included in the pension scheme as their employment relationship is not terminated when they retire but is merely changed.