SUMMARY

Austria’s regional and spatial policy has undergone a fundamental transformation over the past five decades – from ad hoc interventions targeting disadvantaged areas to a sophisticated multi-level governance architecture that spans the European Union, the federal government, nine Länder, and hundreds of municipalities and regions.

The Austrian Conference on Spatial Planning (ÖROK) is the cornerstone of this system. Established in 1971, it operates as a cooperative platform – not a regulatory body – bringing together the federal government, all nine Länder, the associations of cities and municipalities, and the social partners. This model of voluntary coordination, embedded in Austria's tradition of social partnership, has proven both durable and adaptable.

Conceptually, Austrian regional policy has moved through several distinct phases. The early focus on attracting external investment to lagging regions gave way, from the late 1970s onward, to strategies of endogenous regional development – strengthening the specific assets, skills, and networks embedded in each territory. EU accession in 1995 introduced cohesion policy programming, substantially increasing available funding and elevating the Länder as primary policy actors. Today, smart specialisation – combining regional strengths with emerging technologies – constitutes the leading strategic concept.

Key challenges ahead include: improving vertical and horizontal coordination across governance levels; addressing demographic change and agglomeration pressures; integrating social and environmental dimensions more fully into regional strategies; and adapting to the anticipated shift in EU cohesion policy as part of the new Austrian “National Regional Partnership Plans (NRPP)” from 2028 onwards.

Territory, Governance, and the Austrian Way

Territorial development – the way societies organise themselves across space, manage regional disparities, and direct investment and opportunity to where it is needed – lies at the heart of sustainable growth and social cohesion. In Austria, a small, landlocked country with a rich federal tradition, these questions are particularly complex. Nine Länder with strong constitutional competences, a tradition of social partnership, a historic urban-rural divide, and deep integration into European policy frameworks have together produced a distinctive and evolving model of regional governance.

Regional policy as a defined concept entered Austrian discourse only in the early 1970s. Crucially, neither “regional policy” nor “spatial development” is governed by a dedicated national law. Instead, Austria has developed a cooperative governance model built on coordination and partnership across federal and Länder levels, embedded in the country’s tradition of social partnership.

This article traces how that architecture emerged, how it has adapted over five decades of political, economic, and European change, and what challenges it faces today. It also provides an overview of EU fund deployment in Austria and distils a number of insights from Austrian practice that may be of wider relevance.

ÖROK: Austria’s Cooperative Platform for Spatial Planning

At the centre of Austria’s spatial and regional governance system stands the Austrian Conference on Spatial Planning – the Österreichische Raumordnungskonferenz, universally known as ÖROK. Established in 1971, ÖROK is one of Austria's most distinctive institutional innovations: a permanent, politically high-level forum that brings together the federal government, all nine Länder, the Association of Austrian Cities and Towns (Österreichischer Städtebund), and the Association of Austrian Municipalities (Österreichischer Gemeindebund), alongside the major social partners.

ÖROK's mandate is not to legislate or regulate, but to coordinate, recommend, and produce knowledge. Its working methods reflect the Austrian philosophy of cooperative federalism: decisions are reached by consensus, recommendations carry political weight without legal force, and participation is broad enough to ensure buy-in from all levels of government. ÖROK operates through a Steering Committee at the political level and a Coordination Committee at the technical level, supported by a permanent Secretariat in Vienna.

The key substantive output of ÖROK is the Austrian Spatial Development Concept (Österreichisches Raumentwicklungskonzept, ÖREK) – the overarching strategic framework for spatial and regional development, which is revised every 10 years. The current “ÖREK 2030” (the 5th in a row) rests on four pillars: regional and national competitiveness; social diversity and solidarity; climate change adaptation and resource efficiency; and cooperative and efficient structures for action. ÖREK Partnerships – thematic working groups involving a wide range of stakeholders – translate these strategic directions into concrete recommendations across topics such as housing, mobility, and regional management.

Beyond the Spatial Development Concept, ÖROK produces its own publication series (of which this paper draws on No. 202), commissions research projects, maintains the ÖROK Atlas – an important geographic information system for Austria – and organises knowledge exchanges across governance levels. Since 2014, ÖROK has also served as the Managing Authority for the Austria-wide Regional Programme, co-financed by the European Regional Development Fund (ERDF), bringing together what had previously been nine separate Länder programmes into a single coherent framework.

Five Decades of Conceptual Evolution

Understanding Austrian regional policy today requires a brief journey through its intellectual and political history.

When regional policy first emerged as an explicit field in the early 1970s, it was dominated by approaches centred on attracting plant locations, capital inflows, and infrastructure investment to overcome regional disparities. From the late 1970s, this gave way to systemic approaches focused on endogenous regional development, debated in Austria under terms such as “self-reliant regional development” and later “endogenous renewal”. The paradigm shift rested on recognising that the most important factors shaping regional development are territorially embedded: settlement and infrastructure patterns, the skills and specialisations of local enterprises and workers, and their relationships with institutional structures. The region became the locus of concrete solutions; policy’s task shifted to creating enabling framework conditions.

The early self-reliant approach concentrated primarily on lagging rural regions. When the structural crises of old industrial areas emerged in the 1980s, the spatial focus widened. “Innovation-oriented regional policy”, enriched by concepts of regional innovation systems and the cluster paradigm, established networking and cooperation as the new logic. Austria’s EU accession in 1995 reinforced this shift further, introducing cohesion policy programming and substantially increasing available funding. The classical goal of reducing regional disparities was progressively reframed as structural policy centring on adaptability, with “regional competitiveness” – in the context of resource-efficient and environmentally compatible development – emerging as the guiding concept. The current leading concept is “smart specialisation” – combining existing regional strengths with emerging technologies and future trends, while emphasising the significance of territory for successful innovation strategies.

The Multi-Level System in Practice

Austria’s regional policy today operates across four nested levels – EU, federal, Länder, and regional – each with distinct actors, strategies, and instruments, bound together by dense coordination networks.

The Länder as Strategic Actors

EU cohesion and agricultural policy instruments from the mid-1990s substantially increased regional policy funding and elevated the Länder as the primary actors. Each Land now possesses a comprehensive strategy architecture combining spatial development strategies, sectoral development strategies, and Smart Specialisation Strategies. This process triggered the creation of regional and economic development agencies in each Land, and intensified cooperative practice across all levels.

Territorial development in the Länder now addresses a broad set of challenges beyond purely economic concerns: demographic change and its infrastructure implications; out-migration from peripheral regions alongside agglomeration pressures in urban areas; migration and integration; organisation of basic social services; and cooperation between cities and their functional hinterlands. The main regional instruments include policy coordination forums, advisory and activation structures (e.g. NÖ.Regional.GmbH, Regionalmanagement Oberösterreich), and financial assistance oriented towards development processes and pilot projects.

Due to the growing administrative burden of European Funds, recent years have seen a deliberate trend towards nationally funded programmes better suited to initiating complex, place-specific cooperation – for example Styria's Regional Development Act 2017, Tyrol's targeted programmes for Osttirol-Iseltal and Pitztal, and Lower Austria's NÖ.Regional.GmbH schemes.

Federal Structural Policy and Labour Market

The federal government concentrates on national structural policy goals: science-business cooperation, networking, and start-up support through excellence-oriented competitive programmes (COMET, AplusB Scale-Up). These have spatial impacts but do not pursue explicit regional policy objectives. Universities have become increasingly important regional actors, expected under successive General Austrian University Development Plans to fulfil not only academic but also regional and social transfer functions – their so-called “third mission”.

Labour market policy has a traditionally strong regional dimension. The Austrian Employment Service (AMS) operates through a federal organisation, nine Länder organisations, and 98 regional offices. The European Social Fund (ESF) has enabled innovations such as preventive labour market policy and expanded the group of actors to include the Länder, with fund allocation adapted to regional needs alongside national objectives.

The Regional Level: Strategies and Organisations

At the level below NUTS II, integrated development strategies guide territorial development through collaborative processes. Unlike spatial planning programmes, these strategies do not define binding regulations but serve as reference frameworks for regional development organisations. Present in all regions – established either at Land level or as regional management associations – these organisations mobilise and advise project initiators, transfer information, and moderate between regional stakeholders, deploying instruments such as LEADER, European Territorial Cooperation, and national funding schemes.

Challenges for Regional Policy

Austria's federal structure and cooperative traditions provide strong foundations for integrated territorial development. However, the multi-level governance system also generates ongoing challenges:

• Communication and coordination within the multi-level system: ensuring instruments are effectively focused across EU, federal, Länder, and regional tiers.
• Overcoming internal borders: particularly between Länder and between cities and their functional catchment areas.
• Greater consideration of social challenges in regional economic development, treating these as opportunities for innovation.
• Redefining the role of EU cohesion policy instruments and creating new impulses for future programming periods.

The key structural shift is that classical regional policy – defined by demarcating problem areas and targeting structurally disadvantaged regions – has largely given way to a territory-wide approach based on mobilising endogenous potential across all types of regions. The multi-level governance system now constitutes the policy framework for regional development in Austria, with a regional policy mix deployed through development organisations rather than top-down redistribution.

The Austrian Multi-Level Governance System at a Glance

Regional policy in Austria operates across four nested levels, each with distinct actors, strategies, and instruments:

Vertical and horizontal coordination flows between these levels through formal instruments – intergovernmental agreements under Article 15a of the Austrian Federal Constitution and CPR Partnership Agreements (s. below) – and informal platforms like ÖROK or the so-called Bundesländerdialog on innovation policy. The system is characterised by negotiation, information exchange, and voluntary coordination rather than hierarchical command. It is this quality – the absence of top-down authority combined with a deep culture of mutual obligation – that makes the architecture both resilient and demanding to maintain.

The EU Funds Landscape in Austria

Despite its comparatively high level of prosperity, Austria relies on EU Structural and Investment Funds to drive innovation, sustainable growth, social inclusion, and territorial cohesion. In the 2021-2027 programming period, Austria draws on several funds implemented in “shared management” mode – funds covered by the Common Provisions Regulation (CPR) as well as the European Agricultural Fund for Rural Development (EAFRD), which operates outside the CPR but remains of considerable regional policy relevance.

Financial Overview

Cohesion policy – comprising ERDF, INTERREG, ESF+, Just Transition Fund (JTF), and European Maritime, Fisheries and Aquaculture Fund (EMFAF) – accounts for approximately EUR 1.32 billion, forming the core of EU funding for Austria. This is supplemented by around EUR 217 million from the HOME Funds for security and migration, and – by far the largest single item – EUR 4.1 billion from the EAFRD for rural development:

* Current prices in accordance with the Partnership Agreement 2021-2027.

Strategic and Institutional Framework

The Partnership Agreement between Austria and the European Commission – covering ERDF, ESF+, JTF, and EMFAF – provides the overarching strategic framework, addressing four EU policy objectives: a smarter Europe (research and innovation); a greener Europe (ecological transition); a more connected Europe (mobility and digital infrastructure); and a more social Europe (social inclusion and employment). A specific objective applies to the JTF, targeting regions most affected by decarbonisation.

ÖROK plays a central coordinating role across this landscape: as the national coordination platform for EU regional policy, as National Contact Point for INTERREG (covering seven cross–border cooperation programmes with direct neighbours, plus transnational programmes for Alpine Space, Danube, and Central Europe, and the interregional INTERREG Europe programme), and – since 2014 – as Managing Authority for the Austria-wide ERDF/JTF Regional Programme. Austria is also engaged in macro-regional strategies (EU Strategy for the Danube Region, EU Strategy for the Alpine Region (EUSALP) and European knowledge networks (ESPON, European Urban Initiative).

The Austria-Wide ERDF/JTF Regional Programme

The Austria-wide ERDF/JTF Regional Programme combines resources from both funds within a single multi-fund framework, with a total volume of just under EUR 1.66 billion (EUR 597.4m EU contribution, EUR 270.8m national public, EUR 795.8m private). ERDF resources are distributed across three priorities: Innovation (59%, EUR 287.8m), focused on research cooperation, technology transfer, and innovative SMEs; Sustainability (30%, EUR 150.6m), covering energy efficiency, the circular economy, and climate-resilient infrastructure; and Territorial Development (11%, EUR 55.0m), targeting functional spatial areas, inter-municipal cooperation, and reduction of regional disparities. The JTF is programmed under a fourth priority targeting the decarbonisation transition.

Implementation runs through ÖROK as Managing Authority, 14 Intermediate Bodies (3 federal, 11 at Land level), a single audit authority, and a unified monitoring system – complemented by a national Steering Committee representing the nine Länder and the BMLUK. Actual project delivery is exclusively managed by the Intermediate Bodies, following a defined process chain from beneficiary information through to final verification of outputs and costs.

Instead of “Lessons Learned”…

The Austrian experience in regional and spatial policy yields a number of transferable insights for any governance system seeking to build effective, sustainable territorial development. These are not “lessons learned” in a prescriptive sense, but rather reflections distilled from decades of practice in a complex federal and multi-level environment.

People are at the Core

Ultimately, the quality of any regional policy system depends on the people who implement it. Skills, mutual trust, and long-lasting institutional relationships are the foundation of a robust administration. Frequent staff turnover or short-term contracts erode the institutional memory that is essential for continuity in complex, multi-stakeholder governance processes. Building and retaining experienced teams – at all levels, from regional management offices to federal coordinating bodies – is therefore not a secondary concern but a precondition for systemic effectiveness.

Clarifying Competencies is a Prerequisite

A clear and commonly understood delineation of responsibilities between administrative levels is not merely desirable – it is a precondition for functional governance. Where competencies overlap, are contested, or remain ambiguous, coordination costs rise, accountability diminishes, and policy coherence suffers. Austria’s own experience shows that even a well-functioning cooperative system requires ongoing attention to role clarity, particularly as new policy domains emerge – such as climate adaptation, digitalisation, or EU fund management – that do not map neatly onto established jurisdictions.

Coordination Must be Neutral and Horizontal

Effective coordination across levels and actors requires a dedicated, neutral platform – one that holds no interests of its own beyond ensuring the best possible coordination among its participants. ÖROK in Austria serves this function: it brings together the federal government, the Länder, municipalities, social partners, and interest groups on an equal footing, without a hierarchical mandate.

This horizontal model of coordination – operating through consensus rather than command – is what makes the system resilient. A coordination architecture that depends on top-down authority is fragile: it may function smoothly in stable conditions but is liable to break down precisely when it is most needed, in moments of political tension or institutional stress. A system built on equal-footing negotiation and mutual trust is far better positioned to withstand such pressures.

Do Not Model A System on Current EU Regulations Alone

A recurring risk in countries building or reforming their spatial and regional policy systems is the temptation to mirror the structure of EU cohesion regulations rather than design a system suited to their own administrative context and development needs. EU regulations are the product of negotiation among 27 Member States and reflect the lowest common denominator of very different national situations. They should be a reference, not a blueprint.

Moreover, EU regulations change. A notable upcoming example: according to current European Commission proposals, the formula for allocating “regional” EU Funds per Member State for the 2028-2034 programming period will shift from NUTS II to NUTS III as the statistical basis. This has potentially significant implications for how Member States structure their regional classification and programming architecture. Designing a national system around current rules may therefore prove costly to adapt when those rules are revised.

There is No One-Size-Fits-All Approach

Every Member State – and every region – is unique in terms of its constitutional structure, administrative traditions, economic geography, political culture, and development trajectory. There is no single model of regional policy governance that can simply be transplanted from one context to another with reliable results. Austria’s cooperative, non-legislative approach to spatial coordination, for instance, reflects specific features of Austrian federalism and social partnership that cannot be assumed elsewhere.

This does not mean that comparative learning is without value – quite the contrary. Studying different systems, identifying the principles and mechanisms that explain their success or failure, and selectively adapting elements that are compatible with the local context is a highly productive approach. The goal is not imitation but informed design: creating a system that is genuinely one's own, informed by the best available international experience.

This article has been prepared by Johannes Rossbacher, in supporting U-LEAD in providing expert analysis of the Regional Development Policy in the context of Ukraine’s support needs in meeting the recommendations of the European Commission under Ukraine Enlargement Reports concerning Chapter 22 Regional Policy and Coordination of Structural Instruments.

U-LEAD with Europe: Local Empowerment, Accountability and Development Programme is a multi-donor action of the EU and its member states Germany, Denmark, France, Austria, Poland and Slovenia to support Ukraine on its path to strengthening local self-government.
U-LEAD promotes transparent, accountable, resilient and responsive multi-level governance in Ukraine and empowers municipalities.

The contents of this article are the sole responsibility of its authors and do not necessarily represent the views of U-LEAD with Europe, the European Union and its member states Germany, Denmark, France, Austria, Poland and Slovenia.

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Johannes Rossbacher an Austrian senior public administration expert with long-standing professional experience in EU Cohesion Policy, regional development, and spatial planning, holding a unique position in the coordination of European and national regional policy frameworks. Over more than three decades, he has represented Austria at EU level and played a central role in shaping and negotiating Cohesion Policy packages, including during Austria’s EU Council Presidencies. His career combines strategic policy coordination, programme management, and international advisory work, including long-term expert assignments supporting structural funds preparation in EU Member States.