The ÖVP and the Greens spoke today Budget Committee for the postponement of its motion for a resolution regarding budgetary resources for Austria’s participation in the European Sky Shield air defense initiative. Specifically, according to the motion for a resolution, budgetary authorization should be created to justify the prior charges for the necessary purchases of air defense systems (4145/A(E)).
The ÖVP and the Greens stated that, from their point of view, joining Sky Shield, contrary to the FPÖ’s criticism, did not represent any military alliance and did not see this as a contradiction to Austria’s neutrality. The Greens justified the postponement by saying that they did not want to anticipate these far-reaching budgetary measures on this issue so close to the election.
Debate about compatibility with neutrality
Jakob Schwarz (Greens) was convinced that monitoring European airspace for defense purposes was only possible together with European partners. Joining Sky Shield does not lead to operational activities. Nevertheless, justifying previous charges so shortly before the election would look too far into the future, said Schwarz. In any case, Friedrich Ofenauer (ÖVP) did not see the defense initiative as a military alliance, but as a procurement initiative. It is a fact that Austria’s accession does not contradict Austria’s neutrality. The purchases are important to protect Austria and its population.
In contrast, Volker Reifenberger (FPÖ) presented reports to the meeting that would say that accession would not be compatible with Austria’s neutrality. He called for an immediate stop to Austria’s participation and the continuation of Austria’s independent defense. He interpreted the postponement to mean that the FPÖ’s political pressure on this issue was having an effect. Reifenberger and Christoph Matznetter (SPÖ) agreed that the defense minister was missing documents and information. Matznetter took the position that the matter had to be prepared with great care and that all facts had to be on the table. Only then could a report be drawn up as to whether there had been a violation of neutrality, he said in the direction of the FPÖ. From his point of view, it is currently “a good decision not to make one”.
According to the application, in July 2023 Austria signed a declaration of intent to participate in the European Sky Shield Initiative. The aim is to strengthen the air defense of the participating European states against attacks from the air by projectiles, missiles or aircraft. The project to build a coordinated air defense system for European countries arose against the background of Russia’s war of aggression against Ukraine.
According to the motion for a resolution, 19 states have currently signed a declaration of intent to participate in this European initiative. Austria intends to participate in joint procurement and training measures, but not in operational measures. Measures that could be viewed as participation in a military alliance or as allowing bases on Austrian territory are expressly excluded. Overall, the declaration explicitly excludes any measures that would conflict with Austrian neutrality.
Continued high budgetary burden due to crisis measures
In addition, the MPs in the budget committee dealt with the ongoing implementation of the budget. According to the Parliament’s Budget Service, this is characterized by a persistently difficult economic environment and a declining but still high budgetary burden due to crisis measures. The delayed effect of high inflation on some areas of expenditure, such as pensions and personnel expenses, as well as the priorities set in the context of budget preparation and the new financial equalization, lead to a sharp increase in payments. On the deposit side, the higher wage bill does result in additional deposits, but overall the economic environment is dampening the development of deposits.
At the end of July 2024, the federal government’s net financing balance (deficit) stood at -15.8 billion Ꞓ. This is 7.4 billion Ꞓ more negative than in the previous year, reports the Ministry of Finance in its monthly updates to the Budget Committee. As far as the budget path according to the federal estimate is concerned, Finance Minister Magnus Brunner stated in the committee that this would be adhered to despite the challenging economic situation.
The majority of the ÖVP and Greens took note of the monthly successes for May to July 2024 (168/BA, 167/BA, 163/BA), as well as the report on overuse of funds and previous charges in the 2nd quarter of 2024 (164/BA). The majority of ÖVP and Greens also acknowledged reports for the second quarter of 2024 on the measures taken within the framework of the European Stability Mechanism (ESM) (165/BA) and on the measures to stabilize the balance of payments (166/BA). (Continuation of the Budget Committee) mbu
NOTE: The Parliamentary Budget Service offers economic analyzes of budget policy and templates from the Federal Ministry of Finance. All current data on budget implementation (monthly reports) can be found on the Ministry of Finance website.