In this article—the first in a series of interviews with notable figures in the world of budgeting and PFM that will be published in the coming months on the PFM Blog—Johann Seiwald interviewed Gerhard Steger about Austria’s recent gender budgeting initiative. Mr. Steger was the Chair of the OECD’s network of Senior Budget Officials from 2009 until 2014, and Director of Budget in the Austrian Ministry of Finance from 1997 until 2014. Currently, he is, amongst others, member of the IMF’s Government Finance Statistics Advisory Committee (GFSAC).
What was the motivation for including gender budgeting in the wider reform of Austria’s budget and accounting system? Why not environment budgeting, or social budgeting, or public infrastructure budgeting? What is special about gender as a topic that makes it worth singling out?
Steger: Gender budgeting was an integral part of the Austrian budget reform which was introduced in 2013. A budget is a shoehorn and not a shoe, in other words it is not an end in itself but a means of using public resources to generate policy results for people. A crucial element of the Austrian reform is performance budgeting. Each ministry has to define a strictly limited number of intended policy outcomes, outputs, and performance indicators which require the approval of parliament. Gender equality is one of the dimensions of this framework, and the only one that is completely cross-cutting and mandatory for all ministries. For each of the 32 budget chapters, a maximum of five outcome/impact objectives (and related performance indicators) have to be defined by the ministries, out of which one objective must be related to improving gender equality.
Obviously, setting priorities in the budget process is a matter of political judgment. Decision-makers felt that gender equality is a policy area which deserves particular attention. Gender gaps still exist in Austria and lack of gender equality affects the entire country and its future. This particular focus on gender does not mean that other important policy areas are neglected or given insufficient attention. For example, issues related to improving the environment, transportation systems, and social affairs are also addressed in the performance budgeting framework.
Gender Budgeting is often (mis)understood as a tool for dividing budgets into “male” and “female” components. Can you explain the approach taken in Austria?
Steger: The basic assumption is that public resources should improve people’s lives. Therefore, existing problems are to be solved and perceived deficiencies reduced as much as possible. The decisive question of gender budgeting is not “How much money is allocated to women and men?” But rather “To what extent are gender inequalities reduced, and what contribution can ministries and other institutions make to improving these outcomes?” Gender budgeting focuses not only on the perceived disadvantages of women, but on specific problems faced by men as well.
Did the implementation of gender budgeting require new legislation?
Steger: Yes, to implement gender budgeting permanently, the Austrian parliament by unanimous vote changed the country’s Constitution. Article 13 states that “The Federation, States, and Communes are to strive for equality of women and men in their budget management.” Furthermore, all proposals for new legislation require the government to undertake a standardized impact assessment which, among other dimensions, covers gender equality.
OECD studies show that the gender pay gap in Austria is still very high. After more than two years of applying the new approach, what benefits have been achieved?
Steger: Change needs to be assessed in a medium- to long-term context. The most important immediate benefit is putting gender equality firmly on the government’s policy agenda. Each ministry has to engage with the challenge of reducing gender inequality. There is no exception. Resulting from this process, many important gender issues have been identified and measures to address them initiated. These issues include: safeguarding women against violence; facilitating a reasonable balance between work and family life; reducing poverty among women; and improving the representation of women on boards and other senior management positions.
Of course, this new approach requires substantial changes in the attitudes and culture, not least among public servants. Such changes will inevitably take time to develop and mature. For monitoring progress, the budget includes numerical performance indicators for the budget year, but also the medium-term development goal. In the meantime, watchdogs are crucial to ensure adequate implementation of new policies. The implementation of gender equality is monitored by the Federal Chancellery which reports to parliament. The Austrian Court of Audit is also playing a key role by preparing reports that scrutinize the implementation of performance budgeting in general and gender budgeting in particular.
What lessons has the Austrian government learned from implementing the new policy framework? What can other countries learn from Austria?
Steger: I would highlight four important lessons. First, as with other issues of public policy, gender budgeting needs support at the political level, within senior public management, and from the wider public. The broader the support is, the better the chances are for a successful implementation. Thus, building alliances to back gender budgeting is key.
A second issue is to implement gender budgeting in a simple and at the same time smart way. It is important to avoid a too complex approach which in practice is difficult to handle. Therefore, the Austrian approach limits the number of performance outcomes, outputs, and indicators per budget chapter/ministry but, at the same time, allows no exceptions. Each ministry has to be on board.
Third, training is key to building necessary professional skills—for instance, developing performance indicators. Such training efforts are required both at the technical and political level: politicians need to understand why gender equality is important and how they could use it to rally support.
Finally, it is important to calibrate expectations to avoid disappointment. Gender budgeting is an ambitious cultural change project that requires a smart setting (including effective watchdogs), time, and tenacity. It is not sufficient to change laws. The real challenge waits afterwards: to make sure that the new legislation is applied rigorously and addresses key deficiencies in gender equality in a comprehensive and focused way. Like other important change management processes, reducing gender inequalities will require many years of sustained effort, together with continuous reevaluation of the policy measures that have been implemented and their impact.
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