Finance Minister Markus Marterbauer is on his way to Brussels. The EU economics and finance ministers are meeting there on Tuesday. One of the items on the agenda there is also of enormous importance for the Austrian Armed Forces. As a precautionary measure, the Republic of Austria would like to activate the so-called “national escape clause” in order to secure budgetary leeway for the “Armed Forces 2032+” build-up plan.
Despite the ongoing EU deficit procedure, this is likely to be a mere formality. In the meantime, 16 EU member states have activated this escape clause. It is therefore extremely unlikely that Austria will be refused.
Nevertheless, there is apparently a small peculiarity. Austria wants to charge additional defense spending amounting to 0.2 percent of economic output as early as 2025, i.e. retroactively, by way of the escape clause. As the clause only applies for a period of four years, the window of opportunity for the Austrian Armed Forces will be relatively short. For the last time in 2028, up to 1.5 percent of economic output could then theoretically flow into defense spending without being sanctioned by the EU for higher deficits as a result. Theoretically, this 1.5 percent could cover the entire armed forces budget (UG 14) and more. It is therefore extremely unlikely that Marterbauer wants to make full use of this framework.
Defense Minister Klaudia Tanner needs additional funding for engineers, infantry, armored troops, artillery and reconnaissance – as well as for drones, medical services, logistics, cyber capabilities, the hunting command and numerous other areas if the “Armed Forces 2032+” development plan is to be fully implemented and the armed forces are to become capable of defending themselves again.
In the government program, the coalition partners ÖVP, SPÖ and NEOS have committed to continuing the “Bundesheer 2032+” build-up plan initiated under the ÖVP and Greens. Just as importantly, the military spokespersons of all parliamentary groups have also given their full support to these plans. The consistent implementation of the Bundesheer armament plans therefore has the broadest possible political backing – a rather unique situation in national defense policy, at least when looking back over the last few decades.
Equally unique: In the National Defense Financing Act (LV-FinG) adopted in 2022, the Republic of Austria commits to “a continued increase in the budget of subdivision 14” (national defense budget).
Nevertheless, the 2025 and 2026 budgets in particular are sagging somewhat on the home straight, albeit not tragically. Much more worrying: the budget forecast for 2028 and 2029 did not provide for the necessary increase in funding to implement the “Armed Forces 2032+” build-up plan. If the Republic of Austria wants to achieve the set goal, there is no alternative to additional funding.
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The German government would like to pass the planned double budget for 2027/28 in parliament before the summer. Both more modern equipment and more personnel can only be realized if the 1.5 percent of gross domestic product targeted for the reconstruction plan is also achieved. If this is not reflected in the budget laws for 2027/28, the full implementation of the recovery plan is likely to be jeopardized at the very least. And the longer-term budget target of two percent of gross domestic product mentioned in the government’s program will then be an infinitely distant prospect.
All of this against a backdrop of increasing geopolitical tensions. The ongoing Russia’s war of aggression against Ukraine and a significant cooling of relations between Europe and its closest ally for decades, the USA, form the basis for this development.
Here for more news about the Austrian Armed Forces.