Austria’s banking and insurance sector has welcomed Chancellor, Christian Stocker’s, proposal for a 'future investment portfolio' for young people, arguing that the capital market should play a greater role in long-term saving and retirement provision.

The proposed portfolio would aim to support long-term wealth accumulation for younger generations through capital market investment, including tax advantages.

Austrian Federal Economic Chamber (WKÖ) Federal Division of Banks and Insurance chairman, Michael Höllerer, praised the initiative, which Stocker outlined during an ORF summer interview.

Höllerer said policymakers recognising the capital market as a retirement planning tool was a “welcome and necessary step”, pointing to the experience of other countries in using investment markets to support long-term wealth accumulation.

“The Chancellor's initiative is therefore fundamentally welcome, not least because it can contribute to active financial literacy,” he added.

However, Höllerer stressed that the announcement would need to be followed by concrete implementation, as well as broader political recognition of the role that capital markets can play beyond speculation.

Under the proposal, investments would be built up over an 18-year period, with Höllerer arguing that annual savings, compound interest and an exemption from capital gains tax could result in significant sums being accumulated.

He also called on the government to consider extending capital gains tax exemptions to other retirement savings products.

In addition, Höllerer warned against creating an overly complex system or placing unnecessary administrative barriers around the initiative.

“The idea is simple: The government enables tax-advantaged investments in selected capital market products,” he stated.

Höllerer added that Austria’s banks and insurance companies were ready to work with policymakers on designing and developing the measure.

According to Höllerer, the success of the initiative would depend on whether it could be implemented in practice and whether its design remained focused on sustainable, long-term growth in the portfolio's value.

“Anything that increases the attractiveness of the Austrian capital market is a positive development,” he concluded.

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