Rehab at risk

Trade union boss wants to examine Vamed sale

ÖGB President Wolfgang Katzian

(Bild: krone.tv)

The planned sale of rehabilitation facilities throughout Austria is jeopardizing healthcare. Wolfgang Katzian, head of the Austrian Trade Union Federation (ÖGB), is therefore urgently calling for a retrospective review of the Vamed deal. "We have massive concerns about the sale of this important infrastructure," he says in an interview with the "Krone" newspaper.

The Vamed takeover by the PAI company affects numerous Austrian rehabilitation and healthcare facilities. Private equity companies such as PAI Partners do not stand for continuity in their investments, says Katzian. The company itself states that the average holding period for investments is six years. "Then the company shares are resold with the aim of multiplying the purchase price. "It is obvious that this profit orientation is at the expense of the quality of the services and the employees," says Katzian. And emphasizes: "Many international examples prove this."

Law provides for investigation of problematic acquisition processes
The trade union wants to prevent the deal and believes it has found a legal way to do so: With investment control, Austrian commercial law has an instrument with which potentially problematic acquisitions of critical companies must be investigated. On the basis of an investment review, conditions can be imposed or the acquisition process can be prohibited. The Austrian Trade Union Federation (ÖGB) is therefore calling on Economics Minister Martin Kocher (ÖVP) to review this sale in accordance with the Federal Act on the Control of Foreign Direct Investments (Investment Control Act).

(Bild: Elmar Gubisch)

PAI is based in France and 55% of its investors come from non-EU countries. "A precise list of investors has not been made public. However, media reports confirm our suspicion that investors do have a strong influence on business activities. The opaque structure of the company and its business model alone mean that this business must be prohibited. The security of Austrian healthcare must not be put at risk," concluded Katzian.

Andreas Huss, chairman of the health insurance fund, recently described PIA as a "locust" in an interview with the "Krone" newspaper. These are financial investors who buy companies, restructure them and sell them at a profit. This is usually accompanied by staff cuts and service reductions or restrictions for customers.

The Chamber of Labor also warns that international corporations and financial investors are taking over more and more areas of the social infrastructure. This development is progressing more slowly in Austria than in other countries, but the common good and the stability of the economy and society are still at risk. The UK is a warning example, where the proportion of public beds in residential care for the elderly has fallen from two thirds to just under four percent (!) since the 1980s.

Dramatic development in the UK

(Bild: AK Wien)

In order to prevent developments such as those in the UK or, in some cases, Germany, and to ensure that critical social infrastructure is geared towards the common good, the AK calls for non-profit status to be strengthened and profit-oriented investors to be pushed back. Similar to the regulation of primary care centers, where financial investors were proactively kept out, a protective shield could also be considered for other areas.

Investors should demonstrate benefits for the country and its people
In addition, investment screening geared towards geopolitical security risks should also include risks to the common good. The Canadian "investment screening", for example, provides a starting point for this, where the prospective investor must present the net benefits of their investment for Canada. The Chamber of Labor is also calling for an investment offensive by the public sector.