Social economy network Austria

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Austria's social economy national thematic group in EQUAL

Austria - a more informed debate, plus better solutions for public service delivery

Austrian EQUAL’s national network has succeeded in renewing discussion of the idea of social economy in Austrian society. Its enduring effect has been that there is now a widespread awareness and debate about the reform of social services that is under way in Austria. As a result, the government certainly sees a larger role for the social economy. Speaking at a network conference in January 2005, Martin Bartenstein, Federal Minister of Economics and Labour, pointed out the growing importance of the social economy in creating both jobs and businesses, and expressed his belief in the role of public-social-private partnership in promoting this. This blueprint for three-way cooperation had already been the subject of a symposium in September 2004. He welcomed the sector’s increasing professionalism and sounder finances – helped in part by EQUAL.


Raising public awareness

The network’s main activity has been public relations. It stimulated debate through a long-lasting awareness-raising campaign, launched a newspaper, and held the first big congress on the subject. “Austria has 6,000 enterprises in the social economy, employing 138,000 people and turning over €4 billion a year,” says the network’s co-ordinator, Veronika Litschel. “It is a dynamic sector of the economy that makes a big contribution to social cohesion – yet for some reason it is largely viewed as a cost, and the jobs it provides are often demanding and poorly paid.” The network aimed to improve on the inconsistent patchwork of laws that apply to the social economy in Austria. A second concern was to promote regulation and quality criteria that would prevent the more difficult cases in social care being left by the wayside.

“We have put a lot of effort into ensuring that social economy organisations can play their proper role in public sector tendering procedures,” says Ms Litschel. “Previously, the system was not very transparent but it worked. Now, we have a chaotic situation. A lot is going on, and our network’s lobbying and proposals have opened up the debate so that with any luck better solutions will be found.”

The first promotional tool it employed was the newspaper SOWISO (So Sozial wie Wirtschaftlich – ‘Social as well as Economic’), three issues of which were written and printed. These were circulated to between 30,000 and 50,000 people, including workers in social economy organisations as well as the general public. “It is regrettable that the Austrian press does not usually take any notice of the issues of and exclusion – they are not entertaining enough,” says Ms Litschel. “However our readers gave us very enthusiastic feedback.” A second initiative was at a higher academic level. “In December 2004 we were able to take over an entire issue of the journal Kurswechsel (‘Change of Course’), published by BEIGEWUM, the Beirat für gesellschafts-, wirtschafts- und umweltpolitische Alternativen (Council for Social, Economic and Environmental Alternatives) and invite a range of academics to contribute their thoughts on the social economy. We also commissioned a set of offprints so that we could reach a wider range of readers. This has certainly been a significant success.”

Then in January 2005 the network organised a conference in Vienna entitled Sozialwirtschaft in Österreich (‘The Social Economy in Austria’). “The main objective was promotional,” says Ms Litschel. “It gave all parties, including the Minister and the social partners, the chance to put on record their position on – and support for – the social economy, so it raised the quality of the national debate.”

For the Vienna Chamber of Labour, Christophe Klein said that a flourishing social economy is a key element of social policy. It provides meaningful if demanding work, but is not without its shortcomings as an employer. One issue is that insecure funding leads social enterprises to issue only part-time contracts for what are in effect full-time jobs. For the business community, Reinhold Mitterlehner of the Austrian Economic Chamber also recognised the social economy’s role in meeting the new needs that constantly arise in society. He noted the trend towards professionalisation and quasi-markets, but felt that any competition must be on a fair basis. He objected to sheltered workshops receiving public subsidy if they were going to compete against conventional businesses.

The event gave space to a number of expert panels on key issues:

  • the economisation of the social welfare sector: financing strategies in the social economy
  • reconciling quality and the social economy
  • public-social-private partnership

It was also the forum for the network to launch a series of political demands, under four headings:

  • general acknowledgement of the social economy, including as an employer and a contract partner
  • security, including public financing of support structures and ling-term finance for social enterprises
  • workplace-related demands, including improved training opportunities and employment contracts
  • quality, including the use of quality criteria when awarding public contracts

A well-planned and inclusive process

For Ms Litschel the network’s main success concerns the process it set rolling: “What was important was that we managed to include all the actors in the network, and they succeeded in working together for three years. That had never happened before, and it has changed the policy landscape.” The network started small – just three people – but slowly caught on and eventually involved around 100 people from all 14 development partnerships in the social economy theme. “We encouraged broad participation,” she explains. “For instance putting together the list of demands that we published at the conference stimulated a lot of debate over several months.”

One key factor in the network’s achievements was forward planning. “The development partnerships took the initiative right at the start of EQUAL to found the network, so we were able to write a work plan and implement it with the help of an EQUAL budget,” Ms Litschel recalls. The other thematic networks did not have this support. In fact, the initiative can be traced to three individuals: Ms Litschel herself, Petra Wetzel of L und R Sozialforschung (part of the partnership Der dritte Sektor in Wien: Bestandaufnahme und Weiterentwicklung) and Katrina Moser of Volkshilfe (and the partnership Erarbeitung eines nicht diskriminierenden bundesweiten Muster-Kollektivvertrages). Ms Litschel puts the fact that all three are women down to coincidence.

Better routes to welfare reform

For the moment, the network’s activities are sporadic, since the political consensus to continue its activities in the second half of EQUAL fell apart at the last moment. “We had prepared a proposal to continue the network, and everyone was on board, including the Wirtschaftskammer in Vienna. The stumbling block was a sudden reversal in the attitude of the national Wirtschaftskammer,” Ms Litschel says. But the voluntary sector also wavered. “The five large welfare organisations have their own communication channels to government, so saw no advantage in opening up the field to other social economy organisations.” Nevertheless several of the network’s members have formed an association to carry on its work in a voluntary capacity, and a new network – called – has been formed out of the five development partnerships in the theme in the second round of EQUAL. Work is in progress to create a ‘virtual competence centre for the social economy’ to facilitate mutual learning.

Andrea Grabher of the Public-Social-Private Partnership DP in Graz echoes this: “The main prejudice we have to overcome is not doubt about social values, but the opposite – suspicion of introducing market principles into social services. What is most important for the social economy is that different forms of economic entity can learn to coexist in an atmosphere of mutual respect and trust. Our partnership approach aims to win for the social economy the emancipation and recognition it deserves.”

“Our main area of work at the moment is to ensure that social economy organisations can get fair access to public sector contracts as more and more social services work is put out to competitive tendering. We want to ensure that public utility (gemeinnützig) organisations are not eclipsed by profit-making service providers, and we have expert lawyers such as Professor Dimmel of Salzburg University working on this,” says Ms Litschel.


Veronika Litschel
Organisation: Netzwerk Sozialwirtschaft
Address: Karolinengasse 30/3, A - 1040 Wien, Austria
Tel: +43 699 1941 2819

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