2026 savings plan: Austria is tightening austerity measures, raising age limits, cutting pensions, and increasing the price of the climate ticket

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2026 savings plan: The federal government is tightening austerity measures, raising age limits, cutting pensions, and increasing the price of the climate ticket—all the details.

The three-party coalition of the ÖVP, SPÖ, and Neos has been in office since March and has implemented extreme austerity measures since taking office. This was necessary because there is a massive hole in the domestic treasury – a whopping 15 billion euros are missing.

The federal government, therefore, had to make cuts – this year alone, numerous areas have seen reductions, subsidies have been scrapped, and prices have been increased. With its first package of measures, the three-party coalition aims to save a total of 6.4 billion euros in 2025.

However, this is only part of the total consolidation requirement. This means that cuts will also be made in 2026. “Heute” has taken a look at the measures that have already been decided and will come into force at the turn of the year.

Shortly after taking office, the three-party coalition decided on far-reaching changes to the labor market – more specifically, to the retirement age. The aim is to get Austrians to work longer.

Although the statutory retirement age will remain unchanged, the federal government has passed measures to bring the actual retirement age into line with the statutory age. From 2026, the tightening of early retirement rules will therefore take effect for all those who wish to retire before the statutory retirement age.

The age limit will be gradually raised to 63 (previously 62) and 504 insurance months, or 42 years (previously 40 years). Citizens will have to work two months longer per quarter, depending on when they were born.

A partial pension has also been created. It is to be paid in parallel with the salary if older employees continue to work part-time instead of retiring early. They can decide for themselves how much their working hours should be reduced. If they only work 50 percent, they receive 50 percent of the contributions saved in their pension account in addition to their salary.

Another measure affecting pensioners is the adjustment of their benefits. Here, too, the government has already made cuts and decided on an adjustment below inflation.

From 2026, small and medium-sized pensions up to a gross amount of €2,500 will increase by 2.7 percent. For all pensions above this amount, there will be a flat-rate increase of €67.50 per month.

New for pensioners next year will be the e-card fee. Until now, senior citizens have been exempt from this fee. It has also been increased from €13.60 to €25, which will be automatically deducted from the accounts of the rest of the Austrian population this year (in November).

There are also changes in the labor market. From January 1, 2026, minor secondary employment for unemployed people will be largely restricted. It will then no longer be possible to receive income and unemployment benefits at the same time.

Commuting to work will also become more expensive, at least for those who rely on public transport. The Klimaticket will increase to €1,400 at the turn of the year – for young people and seniors, it will rise to €1,050.

So, 2026 will see further cuts. Austrians are already looking back on numerous savings. One of the most prominent of these is likely to be the abolition of the climate bonus. However, the CO₂ tax, which the bonus had offset, will remain in place.

In addition, the federal government also agreed to increase health insurance contributions for pensioners. Since the summer, our senior citizens have had to pay six percent instead of 5.1 percent.

The prices for official documents have also been raised. Passports, marriage contracts, and, for example, death certificates have cost significantly more since the summer.

All measures are anchored in the federal government’s double budget. This applies to 2025 and 2026 and is expected to bring a total of €8.7 billion back into the budget.

Part of this will also come from the ministries (€1.1 billion). In addition, the three-party coalition is also asking banks (€350 million per year) and energy companies (€200 million per year) to contribute. However, the most significant contribution to the budget consolidation will still be made by ordinary Austrians – after all, the abolition of the climate bonus alone will bring in around €2 billion.