Year in Review 2025: Domestic Politics Between Three-Party Coalition, Deficit Debate, and Security Crisis

The year 2025 was domestically characterized by the formation of the new federal government, which immediately had to tackle a surprisingly large budget deficit. There was good news for former Chancellor Sebastian Kurz (ÖVP), who was acquitted in his appeal trial. Austria was shaken by an Islamist terror attack in Villach, which claimed the life of a teenager. Josef Grünwidl was appointed as the new Archbishop of Vienna.

Record in Government Formation

2025 brings part two of the longest government formation in the Second Republic, which ends 155 days after the National Council election on March 3 with the swearing-in of the first three-party coalition of ÖVP, SPÖ, and NEOS. At the beginning of the year, it did not seem like this would happen, after the NEOS left the negotiations with the other two parties and Federal President Alexander Van der Bellen tasked FPÖ leader Herbert Kickl with forming a government. However, the talks between the Freedom Party and the People's Party failed over staffing issues, leading to a second attempt where ÖVP, SPÖ, and NEOS finally reached an agreement.

The government is led by former ÖVP Secretary General Christian Stocker as Chancellor, SPÖ leader Andreas Babler as Vice Chancellor, and NEOS leader Beate Meinl-Reisinger as Foreign Minister. The Chancellor's cabinet includes 13 ministries and six state secretariats. The key role of Finance Minister goes to the Chamber of Labor economist Markus Marterbauer (SPÖ). While most government members remain scandal-free, NEOS State Secretary Josef Schellhorn faces criticism, among other things, for an expensive company car.

Stocker Becomes Chancellor

Upon reaching retirement age, Christian Stocker becomes the domestic political climber of the year. When Chancellor Karl Nehammer (ÖVP) steps down after the provisional failure of the turquoise-red-pink government negotiations, his former Secretary General unexpectedly takes over the leadership of the ÖVP, while Foreign Minister Alexander Schallenberg (ÖVP) temporarily manages government affairs. Although Stocker's talks with the FPÖ also fail, after reaching an agreement with SPÖ and NEOS on the second attempt, he becomes Chancellor at the age of 65 and is later elected ÖVP leader. Predecessor Nehammer is nominated by the new government as Vice President of the European Investment Bank and takes office in September.

Budget Becomes a Problem

An unexpectedly deep budget deficit marks the first working year of the federal government. A few weeks after the swearing-in, it becomes known that the deficit in 2024 was significantly higher than expected at 4.7 percent of GDP. The government must then put together a comprehensive austerity package, which includes the abolition of the climate bonus. Nevertheless, the EU initiates a deficit procedure against Austria. Finance Minister Markus Marterbauer (SPÖ) aims for a deficit of 4.5 percent of GDP this year, but the course is threatened again in the fall by poor figures from states and municipalities.

Savings in Pensions and Civil Service

The budget woes also necessitate savings in pensions and the public sector. Despite protests from senior representatives, the government decides that in 2026, only pensions up to 2,500 euros will be fully adjusted for inflation. In the public sector, even a salary agreement already passed by parliament is reopened. After tough negotiations with the union, a three-year agreement is reached, which remains below the (expected) inflation rate each year. For politicians, there will be a zero salary increase in 2026.

Attack Plans Occupy Courts

Islamist-motivated attack plans continue to occupy the courts in 2025. A young man must serve two years in prison, who had already been convicted for a planned attack at Vienna's main train station and then engaged with IS again after his release. In connection with attack plans against the Taylor Swift concert in Vienna, an 18-year-old is also sentenced to two years in prison. A two-year partially suspended sentence is given to a teenager who planned an attack at Vienna's Westbahnhof. A particularly severe sentence is handed to a 22-year-old Afghan, who is sentenced to 15 years of unconditional imprisonment in Salzburg for terrorist attack plans.

Messenger Surveillance

In June, the government agrees on the messenger surveillance that the police have been demanding for years. The decision in the National Council is then made against the votes of the opposition in July, with two NEOS deputies also voting against the proposal. Not least, the attack in the Villach city center had pushed the debate forward again. The new regulation allows reading both unencrypted and encrypted messages in cases indicating terrorist and constitution-threatening activities, as well as espionage, on messenger services like WhatsApp or Signal.

Grünwidl Follows Schönborn

The long wait for a successor to Vienna's Archbishop Christoph Schönborn comes to an end in 2025. In January, the Vatican accepts the cardinal's resignation request and appoints Bishop Vicar Josef Grünwidl as administrator. On October 17, Schönborn's former secretary is then also designated as archbishop by Rome.

Kurz Acquittal

The Vienna Higher Regional Court overturns the verdict against former Chancellor Sebastian Kurz for false testimony before the Ibiza inquiry committee. In the first instance, the former ÖVP chairman had been conditionally sentenced to eight months. However, the conditional six-month prison sentence against his former chief of staff Bernhard Bonelli, also for false testimony, is confirmed by the Higher Regional Court.

OLG Overturns Diversion for Wöginger

The Higher Regional Court (OLG) Linz has overturned the diversion for ÖVP club chairman August Wöginger in his abuse of office trial. The OLG Linz has upheld a corresponding complaint by the Economic and Corruption Prosecutor's Office (WKStA), stating that "the specific conditions for a diversion in the case of abuse of office are not met." Wöginger must now face court again. The ÖVP continues to stand behind him, according to Secretary General Nico Marchetti.

Brandstetter Avoids Conviction

The former Minister of Justice Wolfgang Brandstetter (ÖVP) is acquitted of the charge of false testimony in a parliamentary inquiry committee. He was accused of deliberately falsely claiming that he could not hand over his private mobile phone because it was at home. Ultimately crucial for the acquittal is an expert opinion stating that the former constitutional judge was in a "medically vital exceptional situation" during the attempted phone seizure and that his memory performance might have been impaired.

Ott Case

Egisto Ott, former employee in the Austrian intelligence service, is occupying the judiciary. At the end of August, he will be charged with abuse of authority. Ott is alleged to have supported a secret Russian intelligence service in exchange for financial compensation, among other things. In another trial, together with former FPÖ National Council member Hans Jörg Jenewein, Ott is acquitted. Jenewein, who now works for the AfD, is sentenced to twelve months of conditional imprisonment for violating the Weapons Act and abuse of authority. In October, former top official Johannes Peterlik is charged with abuse of authority and breach of confidentiality. He is alleged to have made sensitive internal documents accessible to Ott.

Pilnacek Death Becomes Case for Parliamentary Committee

The death of former Justice Section Chief Christian Pilnacek is being examined in a parliamentary investigation committee. A corresponding request by the Freedom Party, which aims to review the authorities' actions in connection with the case, is implemented by the National Council on the second attempt. Previously, the Constitutional Court had declared a joint committee on the topics of Pilnacek and Corona inadmissible. The case of Pilnacek attracts attention as the Vienna Public Prosecutor's Office withdraws the investigation from the Krems Public Prosecutor's Office and transfers it to the Eisenstadt Prosecutor's Office.

Vienna Election Brings Red-Pink Again

Despite slight losses, the SPÖ remains clearly the strongest force in the Vienna election, which was moved forward to April 27, with 39.4 percent. Newly in second place are the Freedom Party, which nearly triples its share to over 20 percent. The Greens maintain their result from five years ago with minimal losses, reaching 14.5 percent, while the NEOS increase to ten percent. The ÖVP experiences a debacle, falling to fifth place with just under ten percent. Top candidate and city party leader Karl Mahrer subsequently announces his resignation. His successor will be the district chairman of the Inner City, Markus Figl. The SPÖ and NEOS continue their government cooperation under Mayor Michael Ludwig (SPÖ).

Burgenland Election Ends Red Majority

The SPÖ emerges once again as the clear number one from the Burgenland state election on January 19, but loses the absolute majority. 46.4 percent for the Social Democrats means a decrease of 3.6 percentage points. The Freedom Party reaches 23.1 percent, gaining over 13 percentage points compared to the last election. In the ÖVP, state party leader Christian Sagartz is replaced by Christoph Zarits after the People's Party plummets from nearly 31 to 22 percent. The Greens slightly lose to 5.7 percent but are pleased to be included in the government as a coalition partner by Governor Hans Peter Doskozil (SPÖ).

Edtstadler Succeeds Haslauer

Long-time Minister Karoline Edtstadler (ÖVP) will become the new Governor of Salzburg on July 2, after incumbent Wilfried Haslauer steps down mid-year. The advancement comes as a surprise, as Stefan Schnöll (ÖVP) was already designated for the position. However, he ultimately prefers to remain as deputy. The state FPÖ is upset about the change but secures additional competencies in negotiations with the ÖVP and remains in the coalition with the People's Party.

Gewessler Takes Over the Greens

With the Greens' departure from the federal government comes a generational change. Former Climate Protection Minister Leonore Gewessler takes over the party leadership from Werner Kogler and also leads her party's parliamentary club. Newly appointed as deputy is former Justice Minister Alma Zadic.

Police Deployment at Peršmanhof

A police operation at the Peršmanhof in Carinthia leads to tensions with Slovenia. The four-hour large-scale operation at an important memorial site for the resistance of Slovenian partisans against the Nazi regime is directed against an Antifa camp. The deputy head of the State Office for the Protection of the Constitution and Counterterrorism in Carinthia, who ordered and led the police operation, is later reassigned to another department. A commission appointed by the Ministry of the Interior concludes that the operation was disproportionate, illegal, and questionable in several respects.

Deportations to Syria and Afghanistan

Austria significantly tightens its approach to immigration in 2025. For the first time in many years, deportations to Syria, Somalia, and Afghanistan are carried out again, with particular attention drawn to the visit of a delegation of the radical Islamic Taliban from Afghanistan to Austria. The number of asylum applications is sharply declining, partly due to a temporary halt to family reunification ordered by the National Council.

Linz Stays Red

Austria's third-largest city remains red. In the mayoral election in Linz, brought forward due to the Brucknerhaus affair, SPÖ candidate Dietmar Prammer clearly prevails in the runoff against his Freedom Party challenger Michael Raml with over 77 percent on January 26. Predecessor Klaus Luger (SPÖ) must answer in court for breach of trust in connection with the Brucknerhaus affair.

Dornauer Must Go

Tyrol's flamboyant former SPÖ leader Georg Dornauer must leave his party. The reason for his exclusion from the party and the red state parliamentary club is that Dornauer unilaterally demanded in the state parliament the return of "excess profits" from the state energy supplier Tiwag to the population. The deposed state chairman announces an appeal against the party's decision and remains in the state parliament as an independent member.

What Else Happened in 2025

The head of the Austrian State Protection (DSN) Omar Haijawi-Pirchner announces his withdrawal at the end of the year. The Evangelical Lutheran Church in Austria appoints Cornelia Richter as its first female bishop. National Council President Walter Rosenkranz (FPÖ) effectively relinquishes the chairmanship of the National Fund for Nazi Victims by having himself permanently represented. His office manager Rene Schimanek withdraws following investigations into violations of the Weapons and Prohibition Act. The chairman of the SPÖ-affiliated Pensioners' Association Peter Kostelka dies unexpectedly at the age of 78, and Birgit Gerstorfer succeeds him. The former Styrian governor Christopher Drexler (ÖVP) leaves politics, with Markus Fäßler becoming the first SPÖ politician to become mayor in Vorarlberg's largest city, Dornbirn, and the Beer Party ceases its political activities.

(APA/Red)

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