Finance Minister defends steps fighting inflation

18 Apr 2023

Austria’s finance minister, Magnus Brunner, has defended the government’s steps to curb inflation in the country amid mounting criticism.

To tackle rising inflation – above the European Union average – which hit 9.1% last month, the government introduced countermeasures that have been slammed for being inaccurate or for over-subsidising.

Austria is the country least likely to utilise price-effective measures, compared to the rest of the eurozone, according to an analysis by the Momentum Institute using data from the Belgian think tank Bruegel.

To date, the government has relied on measures including support payments and has only made a direct intervention in prices with the electricity price cap, Euractiv reports.

Yet Austria’s finance minister defended the government’s stance in the Club of Economic Journalists earlier this week, as reported by APA.

“Inflation continues to be way too high, no question about it. Our job is to support, we have done that massively. Inflation-tackling measures must always be balanced between accuracy, speed and social compensation,” he said.

However, Brunner went on to say that the possibility for accurate measures was not always sufficient as the required data interfaces were often missing. He added that he’s hopeful improvements will be made, and steps implemented to curtail inflation were managed with experts.

Other countries with a lower inflation rate, such as France and Spain, would have experienced substantial losses in average household income, the minister stated, whilst Austria’s has marginally risen.

Brunner went on to say that no country has “low inflation, high household income, high growth and a balanced budget,” saying the budget would need to be normalised in the coming years.

In regard to inflation, far-right FPÖ Secretary General Michael Schnedlitz criticised the government for not finding “suitable answers” to tackle high inflation.