Local Government in Austria: Sharing Responsibilities

Local Government in Austria:
Sharing Responsibilities
A N D R E A S K I E F E R / F R A N Z S C H A U S B E R G E R
Municipalities are the smallest self-governed political entities, administrative
units, and autonomous economic actors of Austria’s eight Länder.
Vienna is an exception, as it is both a Land and a municipality. The average
size of Austrian municipalities, at 3,400 inhabitants, is rather small. About
half of the municipalities count less than 2,500 inhabitants. Nevertheless,
the number of municipalities has risen from 2,300 in 1976 by 2.5 percent
to 2,358 in 2006. The strength of municipalities is seen as essential for high
levels of involvement and participation by citizens and for strong, democratic
accountability of politicians.
The political actors of a municipality are the mayor, the municipal or city
council, and the executive board. The municipal council is elected directly
by the local population. Since the 1990s, six Länder adopted constitutional
provisions that allow for direct election of the mayor. In general the combination
of elements of a presidential system with a parliamentary one is not
widely appreciated, although politically irreversible.
The strong legal position and the important role of the municipalities
in public life in Austria date back to 1849, when the free municipality
was proclaimed the basis of the free state created by the revolution of
Austria 13
March 1848. Already then, provisions stipulated that the municipalities
were free to cooperate with each other, both in their autonomous and
delegated jurisdictions.
The federal constitution acknowledges a functional division of tasks
between federation, Länder and municipalities. Based on the principle of
subsidiarity, the municipalities enjoy a high degree of autonomy enhanced by
a constitutional amendment in 1962 and mirrored
in the constitutions of the Länder: the jurisdiction
of a municipality comprises everything that exclusively
or mostly concerns the local community that
can be performed by the community within its
local boundaries. This also reflects the principles
of subsidiarity and democracy.
The Austrian Association of Municipalities –
Österreichischer Gemeindebund, and the Austrian
Association of Cities and Towns – Österreichischer
Städtebund, and their respective Länder organizations
represent the interests of the member municipalities
vis-à-vis the federation and the Länder,
and are acknowledged by the federal constitution.
The financial equalization scheme, a federal law
adopted for four to five years, following negotiations
of the federal government with the Länder and municipalities,
was often undermined by subsequent unilaterally-imposed responsibilities
unaccompanied by funding. This led to new and unforeseen administrative
and financial burdens for the Länder and municipalities.
A federal constitutional law of 1998 gave the two Associations a mandate
to conclude agreements with the federation and the Länder on behalf of
the municipalities in order to establish a consultation mechanism for new
legislation and to sign stability pacts. An agreement followed in 1999 that
obliged both the federal and the Länder governments to inform the other
partners about draft legislation and its expected administrative and financial
impact on other governments. After they are informed, a consensus must
be reached in negotiations. Without consensus or if the consultation process
is not properly followed, the offending government, whether federation or
Land, must bear the cost of the legislation.
Austria’s membership in the European Union (EU) in 1995 significantly
changed the legal environment for municipalities in the areas of services
of general interest, contracts, budgetary restrictions, etc. Within the framework
of the Economic and Monetary Union, measures had to be taken to
ensure that Austria met the EU requirements regarding the allowed maximum
deficit of all public accounts of 3 percent of the Austrian Gross
Domestic Product (GDP). The first Austrian stability pact of 1999, aimed
at coordinating budgetary policies at all three levels, assigned the largest
The strong legal
position and the
important role of
the municipalities
in public life in
Austria date back to
1849, when the free
municipality was
proclaimed the
basis of the free
state created by the
revolution of
March 1848.
Andreas Kiefer / Franz Schausberger
share of 2.7 percent to the federation, the remaining 0.3 percent were
shared by the Länder and the 2,358 municipalities. The current pact from
2005 until 2008 stipulates that the federation, the Länder and the municipality
must contribute to achieving the Austrian goals set out in the
European stability pact. The federation has to reduce its budgetary deficit
from 2.4 percent of GDP in 2005 to 0.75 percent in 2008; the Länder,
including Vienna, will contribute with a surplus between 0.6 percent in
2005 and 0.75 in 2008 and the municipalities with balanced budgets per
Land. Tradeoffs between the partners are possible.
In the 1960s and 1970s, four Länder amalgamated municipalities on a
large scale. Lower Austria reduced the number of municipalities from
1,652 to today’s 574. In Burgenland and Carinthia, however, many of these
were separated again after several years. Ever since, federal and Länder
governments have undertaken measures to safeguard the structure of municipalities.
In its coalition agreement of January 2007, the new federal
government announced further guarantees for the existence of municipalities
to be contained in an amendment to the federal constitution:
changes to the structure of the municipalities will hereafter only be possible
with the agreement of the population of the concerned municipalities and
all municipalities shall continue, regardless of their size, to have the same
rights and responsibilities. In order to safeguard adequate performance
and good governance despite the small size of some municipalities, the
legal opportunities for inter-municipal cooperation will be enhanced, also
across Länder borders. Federation, Länder, and municipalities will be able
to create joint institutions for economic activities in order to accelerate
processes and bundle specialist competencies for greater customer service
and to cooperate when acting as public authorities.
Local governments perform their own autonomous functions as well as
tasks delegated by the federation and the respective Land. They are also
responsible for a wide range of public services involving the provision of
infrastructure, kindergarten, senior citizens’ homes, etc. Within their own
jurisdiction, they are subject to supervision but cannot be given instructions
by federal or Land authorities. For example, the Länder and the federation
have, depending on the circumstances, the right to information, the
right of repeal of illegal local orders, the right to approve local ordinances,
and – hardly ever applied – the right to dissolve the local assembly.
The Länder, moreover, oversee the budgets of municipalities with reference
to economy, profitability, and expediency. The standards of supervision
vary considerably between the Länder. For delegated responsibilities,
however, the municipalities are bound by instructions given by federal or
Land authorities.