As Austria faces increasingly complex and interconnected global challenges that require co‑ordinated and coherent policy responses across government, policy coherence for sustainable development (PCSD) presents a strategic tool to strengthen the impact of Austria’s development policy, support the implementation of the 2030 Agenda and maximise the effectiveness of public action in a context of fiscal constraints and competing priorities. This chapter provides an initial overview of Austria’s governance framework and its development co‑operation system. Finally, it presents the analytical framework for the report, which assesses how PCSD principles are and can be integrated throughout the policy cycle – from policy design and implementation to evaluation and reporting – to increase coherence of development policy initiatives.
OECD Policy Coherence Scan of Austria
Abstract
This report is one of the analytical outputs of the multi-country project Building Policy Coherence for Sustainable Development (PCSD) in Austria, Italy and the Slovak Republic. The project aims to strengthen institutional and administrative capacities to advance sustainable development in these countries. Funded by the European Union’s Technical Support Instrument, it provides technical support in public governance, with the purpose of bridging the implementation gap towards achieving the United Nations 2030 Agenda for Sustainable Development and its Sustainable Development Goals (SDGs). A key element of this initiative is the concept of PCSD in accordance with the standards and principles set by the OECD Recommendation of the Council on Policy Coherence for Sustainable Development (hereinafter OECD Recommendation on PCSD) (OECD, 2019[1]) and as called for by the global SDG Target 17.14, which aims to “enhance policy coherence for sustainable development”.1
In Austria, this project contributes to ongoing reform efforts to enhance strategic and institutional frameworks and capacities within the public service. In line with the government’s reform agenda, including its fiscal consolidation plan over the next seven years, the project brings a distinctive policy coherence perspective by focusing on objectives such as reducing bureaucratic burden, generating savings and efficiency gains in the public administration, making better use of synergies and expertise within the civil service, and ensuring the responsible use of public resources. Within this context, the project aims to better translate PCSD principles into actionable steps, particularly in the areas of development policy and development co-operation. Ultimately, it seeks to support Austria’s efforts in ensuring that the SDGs, their interlinkages, including synergies and trade-offs, as well as the potential transboundary impacts2 of national policies are fully integrated into both domestic and external policy frameworks.
The report will begin by examining the relevance of PCSD in the context of development policy. It will then provide a brief overview of Austria’s overall governance framework and its potential to support PCSD, followed by an outline of Austria’s development policy. The report serves as a diagnostic of operationalising PCSD in Austria to identify key focus areas for improvement. It lays the groundwork for subsequent project outputs, including capacity-building workshops and the development of operational guidance.
In a rapidly evolving global landscape, Austria, like all countries, faces increasingly complex and interlinked challenges. These challenges – ranging from geopolitical security risks to migration pressures, climate change and environmental disasters, health crises and economic shocks – transcend borders and ministry portfolios, demanding a strategic, whole-of-government approach.
Austria’s ability to navigate these challenges – and secure a stable, prosperous future – largely rests on its institutional capacity to deliver well-co‑ordinated, coherent, comprehensive and effective policy responses across levels and sectors of government.
PCSD serves as a critical tool for achieving this. Building on the foundations of policy coherence (PC)3 and policy coherence for development (PCD),4 PCSD integrates the economic, social and environmental dimensions of sustainable development into both domestic and international policymaking. In doing so, it supports a more joined-up and forward-looking approach to public policy and represents a key enabler for an integrated implementation of the 2030 Agenda.5
The OECD Recommendation on PCSD (2019[1]), to which Austria is an adherent, defines PCSD as an approach to align policies across sectors and governance levels, manage trade-offs and address impacts of policies – both domestic and transboundary, positive and negative – to ensure long-term sustainable outcomes. The OECD recommendation provides an internationally agreed standard for strengthening PCSD.
In the current context of fiscal consolidation and constrained public budgets, PCSD becomes even more critical. It enables governments to:
Maximise the impact of public spending by identifying synergies across sectors and ensuring that investments generate cross-cutting economic, social and environmental benefits over the long term.
Avoid duplication and conflicting mandates, reducing inefficiencies and administrative burdens.
Ensure alignment between domestic and international objectives, particularly in development policy, generating higher returns on development policy investments through mutually reinforcing policy actions.
Enhance transparency in policy design and implementation.
In today’s globalised world, PCSD is not merely a technical exercise: it is a strategic imperative for Austria. It supports informed decision making, strengthens institutional co‑ordination and, as a result, enhances Austria’s ability to advance its national priorities while contributing to global sustainable development. For development co-operation providers, sustainable development is directly tied to poverty reduction, national interests and global stability, from economic resilience to global security. PCSD reflects an understanding that a more stable, prosperous and sustainable world is in everyone’s interest.
In an era of global trade and interconnected economies, instability in one region can ripple across borders. Therefore, sustainable development is a form of long-term investment that helps mitigate risks for future generations and save significant economic and social costs over time. It helps manage global risks that no country can solve alone, such as pandemics, climate change, forced displacement, financial shocks and global stability. By strengthening the capacity of partner countries to address these challenges and supporting their economic development and welfare, it contributes to building social resilience and inclusive economic growth. This, in turn, strengthens global stability and reduces risks to Austria’s own national security and economic stability. Many of today’s global security challenges, such as conflicts, terrorism and organised crime, are rooted in fragile governance, inequality and lack of opportunities and sustainable livelihoods. Development policy, as a long-term investment, can help address drivers of instability. PCSD can support this by aligning defence, diplomacy, trade and development efforts, thereby optimising the effectiveness of government action and avoiding fragmented spending. In the context of Austria’s planned revision of its security strategy, embedding PCSD principles can help ensure that security, development and foreign policy objectives are pursued in a coherent and mutually reinforcing manner. By integrating a stronger development perspective into the security framework, Austria can better address root causes of instability, contribute to crisis prevention and enhance the resilience of partner countries.
Moreover, when development policy is not properly aligned with sustainability objectives, it can lead to unintended consequences. For example, infrastructure or industrial developments funded through official development assistance (ODA) in partner countries may inadvertently contribute to deforestation, pollution, biodiversity loss or increased emissions. If such initiatives are pursued without careful co‑ordination, they risk undermining environmental and climate commitments both domestically and internationally. Applying a PCSD lens in the design of development policy and its sectoral components helps ensure that these policies are aligned with broader domestic and international goals.
Ultimately, promoting PCSD to co‑ordinate government activities ensures that sectoral policies and investments are well aligned, deliver value and complement one another across multiple fronts – economic, social, environmental and geopolitical. In doing so, it strengthens the overall performance and fiscal sustainability of public policy interventions, which is particularly vital under conditions of constrained budgets.
The Austrian legal framework provides a strong foundation for policy coherence. The Austrian constitution recognises efficiency as a guiding governance principle, empowering the Austrian Court of Audit to identify and eliminate inefficiencies in government administration. The Federal Constitutional Law (Bundes-Verfassungsgesetz, B-VG) mandates co‑ordinated budgetary decisions (Article 13(2)), reinforcing the need for a responsible and balanced financial strategy. Articles 11 and 12 grant the federal government legislative competence in specific policy areas not covered by Article 10,6 while the execution and enactment of implementing laws fall within the remit of the states. This provides a legal basis for aligning policies across these areas and ensuring coherence in governance.
Austria has also established mechanisms for intergovernmental co-operation: co‑ordination at the federal level, between the federal and regional levels, and among regions themselves. At the federal level, various inter-ministerial working groups and task forces provide platforms for exchange on specific policy areas. According to the B-VG, the Federal Chancellery is, responsible for ensuring co‑ordination across government but does not hold executive authority over line ministries. The Council of Ministers7, which favours consensus-based decision making, offer additional avenues for co‑ordination and policy coherence. Article 15a agreements8 enable binding co‑ordination between the federal government and the states (Länder) and have until now been primarily used to co‑ordinate on technical issues in areas such as education, health, social benefits and environmental standards. The formal legislative consultation process (Begutachtungsverfahren) provides another important mechanism for bringing in cross-sector perspectives (e.g. social partners, non-governmental organisations, experts) and identifying unintended consequences, inconsistencies and policy conflicts.
Austria’s governance structure and its political and administrative culture present both strengths and areas for improvement. The federal system, defined by the Austrian constitution and federal laws such as the 1986 Federal Ministries Act (Bundesministeriengesetz), assigns each federal ministry clearly defined and independent areas of responsibility. This autonomy allows for efficient policy implementation once decisions are reached through coalition negotiations. At the same time, such autonomy can also lead to ad hoc or reactive decision making, driven by short-term political priorities or crisis response rather than strategic, cross-sectoral and long-term planning. This approach risks siloed policymaking, undermines policy coherence in general, and PCSD in particular, and may result in contradictory or inefficient outcomes. Ultimately, without deliberate co‑ordination and a sustainability-oriented lens, policies may inadvertently promote unsustainable choices that conflict with environmental, social or economic objectives.
The following section offers preliminary insights into Austria’s performance against the principles outlined in the OECD Recommendation on PCSD (2019[1]). This OECD legal instrument provides a structured framework to help countries enhance their governance systems, institutional mechanisms and policymaking processes. It emphasises the governance mechanisms and operational frameworks necessary for developing and implementing coherent policies across all sectors. The framework comprises eight building blocks (PCSD principles) organised into three main pillars (Figure 1.1), guiding adherents to develop:
a strategic vision to achieve the 2030 Agenda and the SDGs in an integrated and coherent manner
effective and inclusive institutional mechanisms to address policy interactions across sectors and align actions among levels of government
a set of responsive tools to anticipate, assess, and address domestic, transboundary and long‑term policy impacts on sustainable development.
Source: OECD (2019[1]), Recommendation of the Council on Policy Coherence for Sustainable Development, https://legalinstruments.oecd.org/en/instruments/oecd-legal-0381.
This preliminary assessment of Austria’s alignment with the OECD Recommendation on PCSD was based on: desk research; Austria’s response to the 2023 questionnaire to adherents for assessing the implementation, dissemination and continued relevance of the OECD Recommendation on PCSD; and fact-finding interviews with federal government officials and key stakeholders. While Austria has improved and performs well in certain areas, challenges remain. The next section outlines main findings, structured around the three pillars of the OECD Recommendation on PCSD (2019[1]).
Strategic vision for achieving the 2030 Agenda and the SDGs
Austria has adopted a mainstreaming approach to implementing the 2030 Agenda, focusing on goal‑oriented and strategically co‑ordinated processes (Republic of Austria, 2024[2]). This approach aims to integrate the SDGs into strategic documents and budget processes, both at the federal and regional levels.9 It has led to various recent strategies outlining how they contribute to the SDGs as well as to national foreign and development policy objectives.10 While this approach has enabled broad ownership across government, it has also highlighted the need for stronger political commitment and leadership to drive policy coherence in a more systematic and strategic manner. Strengthening high-level direction and accountability mechanisms would help ensure that sustainability objectives are consistently prioritised and effectively translated into co‑ordinated action across sectors.
Building on the progress made in embedding PCSD principles in the current Three-Year Programme on Austrian Development Policy (Dreijahresprogramm der österreichischen Entwicklungszusammenarbeit, 3YP) – particularly through the strengthened mandate of the corresponding Inter‑ministerial Working Group on the Three-Year Programme on Austrian Development Policy (Interministerielle Arbeitsgruppe zum Dreijahresprogramm der österreichischen Entwicklungszusammenarbeit, WG 3YP) for designing, monitoring and evaluating its implementation – there is an opportunity to further operationalise policy coherence within the established framework. This includes enhancing implementation through clearer monitoring arrangements, more robust indicators and streamlined reporting practices. Looking ahead, the forthcoming 2028‑2030 3YP and the planned Austrian Security Strategy present an opportunity to further strengthen coherence across Austria’s strategic frameworks. Aligning development policy more closely with broader foreign, climate and security objectives would underscore the coherent approach Austria aims to pursue in its external engagement. Additionally, while many sectoral policies reference sustainability goals, there is potential to improve impact by bringing them together under a unified strategic umbrella.
Institutional and governance mechanisms for policy co‑ordination
Like other OECD countries, Austria favours a whole-of-government approach to SDG implementation, opting for mainstreaming and bottom-up processes rather than a centralised lead institution. While this encourages broad engagement and buy-in across government, there is potential to build on this foundation and strengthen inter-ministerial co‑ordination, accountability and policy coherence.
Although Austria has established cross-sectoral co‑ordination mechanisms addressing SDGs and PCSD‑related topics – such as the Inter-ministerial Working Group on the Implementation of the Sustainable Development Goals (Interministerielle Arbeitsgruppe zu den Nachhaltigkeitszielen, IMAG on SDGs) and the WG 3YP – these mechanisms often approach coherence through the lens of a specific policy area as part of the strategy formulation and monitoring (e.g. development policy in the case of the WG 3YP). For example, the IMAG on SDGs is tasked with ensuring that SDGs are mainstreamed across initiatives of various federal ministries. The WG 3YP, on the other hand, has a stronger mandate for ensuring policy coherence, however limited to the area of development policy. While these differentiated mandates provide clarity regarding the working groups’ respective focus and contribution to the overall system, there remains scope to strengthen co‑ordination across these mechanisms to ensure linkages, trade-offs and synergies between policy areas are addressed beyond sector-specific perspectives. Streamlining overlapping structures and, where appropriate, strengthening mandates and stepping up institutional support could reinforce complementarities and improve efficiency and impact of existing co‑ordination mechanisms. Austria’s strong track record in stakeholder engagement also offers a solid base on which to build.
Tools to anticipate, assess and address policy impacts
Like other OECD countries, Austria faces challenges in systematically assessing the impact of domestic policies on sustainable development (OECD, 2024[3]). Austria has established a structured and systematic approach to impact assessments within its broader system of performance-oriented budgeting, including an Impact-Oriented Regulatory Impact Assessment (Wirkungsorientierte Folgenabschätzung, WFA), ex post evaluations and results-based budgeting. Building on this solid foundation, there is an opportunity to strengthen the consideration of transboundary impacts within existing tools, for example in impact assessments.11 Strengthening this dimension would not only enable Austria to better identify and manage potential negative effects of its policies on developing countries, but also to capitalise on opportunities to enhance the positive ones at a global scale.
The institutional set-up of Austrian development policy
Austrian development policy operates in a complex policy landscape shaped by international commitments, European Union (EU) development policy and national policies that directly or indirectly impact sustainable development. Ensuring that these different elements are aligned and complementary is critical to maximising Austria’s contribution to global development, to the benefit of both Austria and the world.
The Federal Law on Development Co-operation (Bundesgesetz über die Entwicklungszusammenarbeit, EZA-G) confers competence in development policy to the federal level (Section [§] 1(1)) and provides a legal foundation for policy coherence, establishing that all federal government policies affecting developing countries must align with Austria’s development objectives, defined as poverty reduction, peace and security, and environmental protection (§ 1(3) of the EZA-G) (Republic of Austria, 2003[4]). These objectives remain relevant as they reflect foundational dimensions of sustainable development and address many of today’s pressing challenges such as persistent global inequality, growing instability and armed conflicts, migration pressures and climate crisis, and extreme weather events. In addition, § 22 of the EZA-G stipulates that all federal contributions reported as ODA to the OECD Development Assistance Committee must be designed in accordance with these objectives and the strategic guidelines set out in Austria’s 3YP. By combining a general obligation for policy coherence with specific requirements for ODA-reporting, the EZA‑G strengthens whole-of-government coherence and reinforces the integration of development objectives across sectoral policies.
Austria’s development co-operation is formally led by the Federal Ministry for European and International Affairs, which develops and co‑ordinates Austria’s development policy in consultation with the Federal Ministry of Finance (BMF) (§ 28 of the EZA-G). It sets policy direction and allocates and oversees the budget of the Austrian Development Agency (ADA), which is responsible for implementing bilateral co‑operation programmes (§ 8 of the EZA-G) (see Box 1.1 for an overview of Austria’s development co‑operation system and key priorities).
Austria’s development co-operation is rooted in human rights, partnership and responsibility principles.
Austria provided USD 1.8 billion (preliminary data) of ODA in 2025 (USD 1.7 billion in constant terms), representing 0.33% of gross national income (GNI). This was a decrease of 6.3% in real terms in volume and a decrease in the share of GNI from 2024.
Geographically, and as per Austria’s development policy, it focuses on nine priority partner countries – particularly in Southeast and Eastern Europe and sub-Saharan Africa – and four priority regions (Western Balkans, West Africa and the Sahel, East and Horn of Africa, and Southern Africa).
In terms of sectors, the largest focus of Austria’s bilateral ODA in 2024 was social infrastructure and services. Investments in this area accounted for 44.2% of bilateral ODA commitments (USD 409.4 million), with a strong focus on support to education (USD 301.9 million), government and civil society (USD 55.5 million) and health and population (USD 21.2 million). ODA for other macro sectors totalled USD 247 million, with a focus on refugees hosted in donor countries (USD 103.8 million).
The Federal Law on Development Co-operation (Federal Government, 2003[5]) defines Austria’s three main development co-operation objectives as poverty eradication, ensuring peace and human security, and preserving the environment. In addition, the recently adopted 2025‑2027 3YP provides an operational framework for aligning sectoral and institutional policies across ministries, and on the priorities of Austrian development co-operation. The 2025-2027 3YP further aims to strengthen whole-of-government co-ordination and enhance PCSD.
Austria channels most of its support to multilateral organisations, with its allocations to international financial institutions guided by the Ministry of Finance’s Strategic Guidelines. Austria also has a strong tradition of supporting conflict prevention, nuclear non-proliferation, disarmament, arms control and the rule of law as foreign policy priorities. These priorities are evident in Austria’s leadership in its immediate neighbourhood – Southeast Europe – where it plays an important role in promoting regional and European integration. Austria also seeks to promote peace and security in its engagement with the European Union.
Sources: (OECD, 2026[6]) Development Co-operation Profiles: Austria (2026), https://www.oecd.org/en/publications/development-co-operation-profiles_04b376d7-en/austria_30311c16-en.html; Federal Government (2003[5]), Federal Law on Development Cooperation (2002), including its Amendment (2003), https://www.oe-eb.at/en/dam/jcr:82518ac8-d1e8-4e22-a407-5569a159bb5d/Development-Cooperation-Act.pdf.
When the legal framework was originally designed, fewer actors were involved. Today, implementation of development policy objectives, however, involves over 80 actors: multiple ministries, agencies and even local governments, each with their own mandates and priorities. This results in Austrian development co‑operation being highly fragmented, with responsibilities split across these entities. The BMF, for example, manages Austria’s multilateral contributions and oversees the Development Bank of Austria (Oesterreichische Entwicklungsbank, OeEB), while several other federal ministries, the federal states and local governments also contribute and are involved in delivering Austria’s ODA. Ministries involved include, notably, the Federal Ministry of Agriculture and Forestry, Climate and Environmental Protection, Regions and Water Management; the Federal Ministry of Economy, Energy and Tourism; the Federal Ministry of Education; the Federal Ministry for Women, Science and Research; the Federal Ministry of Defence; the Federal Ministry of the Interior; and the Federal Chancellery. Moreover, Austria now uses a much broader range of financial instruments than when the law was conceived: blended finance, grants, guarantees, bonds and soft loans. (see Box 1.2 for a presentation of the entities disbursing ODA).
The Federal Ministry for European and International Affairs develops and co-ordinates Austria’s development policy and allocates and oversees the budget of ADA, the operational unit of Austrian development co-operation. The Federal Ministry of Finance is responsible for most core contributions to multilateral organisations, including allocations to the EU, and is involved in the oversight of the OeEB. Local governments, the federal states and several other federal ministries – including the former Ministry of Education, Science and Research; the Ministry of Defence; the Ministry of the Interior; and the Federal Chancellery – also contribute and are involved in delivering Austria’s ODA.
Note: The data presented in the graphs, as well as the ministry names used, reflect the ministerial structure and portfolio allocations in place before the reorganisation of ministries following general elections in 2024.
Source: (OECD, 2026[6]) Development Co-operation Profiles: Austria (2026), https://www.oecd.org/en/publications/development-co-operation-profiles_04b376d7-en/austria_30311c16-en.html.
Efforts towards co‑ordinated action in development policy
Many ministries – whether they contribute to ODA or not – implement policies that directly affect developing countries and the attainment of sustainable development objectives globally. Related policy areas – such as security, humanitarian aid, migration, trade, economy, investment and taxation – often produce transboundary effects, where actions in one domain can significantly influence outcomes in another, either reinforcing or undermining long-term development goals. A co‑ordinated and whole-of-government approach to Austria’s development policy is essential to ensure that the multiple entities involved in the disbursement of ODA, as well as the range of stakeholders that implement or have an impact on Austria’s development policy, operate in ways that do not lead to duplication, inefficiencies or contradictions that would ultimately reduce the overall impact of Austria’s development efforts.
A central mechanism to support such co‑ordination is the 3YP, which is intended to bring together different sectoral perspectives and align priorities across government. It serves as Austria’s main strategic framework for development policy and aligns sectoral actions with sustainable development objectives. Updated regularly, it sets priority areas and policy directions to guide Austria’s engagement at bilateral, EU and multilateral levels. However, its role in steering financial allocations is limited in practice, as ODA-related expenditures are largely determined through budgetary processes and reflected in the 3YP ex post. The WG 3YP brings together policymakers from various line ministries and external stakeholders to develop the 3YP and support its implementation. The collaborative development of the 3YPs through the WG 3YP and broad consultations with stakeholders contribute to fostering dialogue and awareness across sectors. However, without formal mechanisms to ensure compliance – for example a monitoring system with common reporting formats, baselines and targets –, the ability to drive policy coherence across government is limited. Parliamentary oversight plays an important role in ensuring accountability but could be leveraged further. Responding to recommendations from the 2020 OECD Development Co-operation Peer Reviews: Austria report, there is an opportunity to strengthen Austria’s institutional framework by building on existing structures and strengthening the mandate and resources of established co‑ordination mechanisms to effectively implement PCSD (OECD, 2020[7]).
Austria has made significant progress in mainstreaming gender and climate considerations across its development co-operation, aided by the fact that the EZA-G enshrines gender equality as a fundamental principle for guiding development co-operation actions (§ 1(4)). However, inconsistencies persist in several areas. Certain trade policies – particularly those related to raw materials – can conflict with development objectives, especially in priority countries and regions of Austrian development co-operation. While Austria’s development co-operation focuses on promoting sustainable development, good governance and economic resilience in countries such as Armenia, Burkina Faso, Mozambique and Uganda, its raw materials strategy prioritises securing access to critical minerals for Austrian and European industries, potentially undermining development objectives.12 Bilateral investment treaties are another example as they may limit partner countries’ ability to enforce stronger environmental and social regulations on foreign mining firms and to tax foreign mining operations. This can reduce public revenue that could otherwise support local economic development. In such cases, trade and investment policies risk diverging from Austria’s co-operation commitments, creating tensions between economic interests and SDGs and weakening PCSD principles.
Additional concerns relate to Austria’s follow-up on its SDG commitments. The Austrian Court of Audit has identified gaps, notably the absence of a comprehensive national SDG strategy and an implementation plan for the 2030 Agenda. It recommends developing a structured national framework that takes into account interactions between the SDGs with clearly defined responsibilities, concrete measures and a corresponding timeline. These shortcomings point to broader challenges in ensuring policy integration and assessing effectiveness across sectors. While stakeholders such as civil society organisations and experts are regularly consulted, particularly in review and reporting processes, there remains scope to strengthen engagement through a more institutionalised forum for ongoing dialogue on PCSD.
Austria’s second voluntary national review (VNR) highlights ongoing efforts to enhance communication and co‑ordination between the federal level and the states (Republic of Austria, 2024[2]). These efforts aim to better integrate processes across levels of governance, in line with the resolution of November 2023 of the Conference of State Governors, for example through regular informal meetings of the nine state governors of Austria’s states. A key focus of these efforts is to identify topics and areas of co-operation that are particularly well-suited to advancing implementation of the 2030 Agenda across the federal and provincial levels. However, with multiple actors shaping Austria’s engagement with developing countries, ensuring that all policies work towards a shared development vision remains a fundamental challenge. Given that the 2030 deadline is now less than five years away, maintaining momentum and strengthening co‑ordination will be critical. In this context, a third VNR could provide a useful opportunity to take stock of progress, reaffirm Austria’s commitment to the 2030 Agenda and identify concrete actions needed to accelerate efforts and close the implementation gap. Nonetheless, as an inherently ex post reporting mechanism, a VNR may have limited impact on shaping a forward-looking vision. Strengthening existing strategic and co‑ordination mechanisms may therefore offer more effective avenues to (re)define priorities, address emerging challenges and drive implementation, including in relation to Austria’s ambition to achieve climate neutrality by 2040. As highlighted in the second VNR, the partnership principle enshrined in SDG 17 and in particular PCSD can serve as a catalyst for progress. This is especially relevant in a context of fiscal constraints, where balancing competing policy priorities is increasingly necessary.
Policymaking is rarely linear and does not occur within a closed system. Instead, governments and institutions operate in dynamic and complex policy environments where multiple actors, sectors and levels of government must co‑ordinate to design, implement, monitor and evaluate policies effectively. In such settings, conflicting priorities, overlapping mandates and institutional silos often hinder co‑ordinated action, leading to inefficiencies, duplication of efforts, wasteful spending and missed opportunities for synergy.
Integrating PCSD principles into the policymaking process can support governments in strengthening their systems and processes to promote more co‑ordinated and forward-looking action. Applying PCSD principles throughout the policy cycle encourages co‑ordination and collaboration and helps to identify policy interlinkages, anticipate risks and potential trade-offs and negative transboundary impacts, and develop more effective responses to interconnected challenges.
The PCSD scan presented in the following chapters assesses how Austria’s existing arrangements support policy coherence across the policy cycle, using the OECD Recommendation on PCSD as the analytical benchmark. The analysis includes developments up to 31 December 2025. For this report, the analysis follows a simplified version of the policy cycle, consisting of three key stages:
1. Policy design: This stage includes problem selection, agenda setting, strategy formulation, planning, budgeting and stakeholder engagement.13 This first step is crucial for establishing the foundations for PCSD by aligning priorities and objectives across sectors and ensuring that diverse perspectives are considered from the outset.
2. Policy implementation: This stage involves executing policies as planned, co‑ordinating activities, monitoring progress across sectors, actors and government levels and adapting to emerging issues. PCSD is essential for effective implementation as it ensures that different actions complement each other, trade-offs are minimised and negative spill-over effects are identified in due time to adjust policies.
3. Evaluation and reporting: This final stage focuses on assessing the impacts and performance of policies. This includes data collection and analysis and feeding evaluation findings back into decision making processes to support continuous improvement. A PCSD approach is key for identifying successes, unintended consequences, long-term effects and opportunities for learning and policy refinement (Schlögl and Zeiner, 2025[8]).
Each stage is assessed against the principles outlined in the OECD Recommendation on PCSD (2019[1]), with a view to identifying strengths and challenges in the current system and suggesting ways forward to further strengthen policy coherence along the policy cycle.
References
[5] Federal Government (2003), Federal Law on Development Cooperation (2002), including its Amendment (2003), https://www.oe-eb.at/en/dam/jcr:82518ac8-d1e8-4e22-a407-5569a159bb5d/Development-Cooperation-Act.pdf.
[6] OECD (2026), Development Co-operation Profiles: Austria, https://www.oecd.org/en/publications/development-co-operation-profiles_04b376d7-en/austria_30311c16-en.html.
[3] OECD (2024), Unleashing Policy Coherence to Achieve the SDGs: An Assessment of Governance Mechanisms, OECD Publishing, Paris, https://doi.org/10.1787/a1c8dbf8-en.
[7] OECD (2020), OECD Development Co-operation Peer Reviews: Austria 2020, OECD Development Co-operation Peer Reviews, OECD Publishing, Paris, https://doi.org/10.1787/03b626d5-en.
[1] OECD (2019), Recommendation of the Council on Policy Coherence for Sustainable Development, OECD/LEGAL/0381, https://legalinstruments.oecd.org/en/instruments/oecd-legal-0381.
[2] Republic of Austria (2024), Österreich und die Agenda 2030. 2. Freiwilliger Nationaler Bericht zur Umsetzung der Agenda 2030 und der Nachhaltigen Entwicklungsziele / SDGs in und durch Österreich (FNU), https://www.bundeskanzleramt.gv.at/dam/jcr:2622dbec-f1bc-45c7-8788-a3d67036e145/Agenda-20230--2-FNU-Oesterreichs--2024.pdf.
[4] Republic of Austria (2003), Bundesgesetz über die Entwicklungszusammenarbeit, https://ris.bka.gv.at/GeltendeFassung.wxe?Abfrage=Bundesnormen&Gesetzesnummer=20001847&FassungVom=2026-03-20.
[8] Schlögl, L. and R. Zeiner (2025), “From Polycrisis to Policy Coherence. How New Public Governance can enhance Austria’s Development Policy”, Briefing Paper 37, Austrian Foundation for Development Research, https://doi.org/10.60637/2025-bp37e.
← 1. Indicator 17.14.1 tracks the number of countries with mechanisms in place to enhance policy coherence for sustainable development. It assesses whether countries have institutional frameworks and processes that help ensure their policies across sectors and levels of government work together to support SDGs: https://unstats.un.org/sdgs/metadata/files/Metadata-17-14-01.pdf.
← 2. The OECD Recommendation on PCSD (OECD, 2019[1]) defines transboundary impacts as any effect – intended or not – originated in one country that crosses national borders through flows of capital, goods, human and natural resources, that is able to affect positively or negatively the sustainable development prospects of another country.
← 3. PC aims to align initiatives across different sectors and levels of government to design complementary and mutually reinforcing policies, PCD considers the objectives of development policy in external and domestic policies in areas which are likely to affect developing countries.
← 4. The OECD Recommendation on PCSD highlights that the principle of PCD is of fundamental importance for the implementation of the 2030 Agenda, and an important contribution to PCSD.
← 5. Austria, as an EU Member State, has a longstanding political commitment to policy coherence, encompassing both the concept of PCD and PCSD. This commitment is enshrined in the EU Treaties. Article 208 of the Treaty on the Functioning of the European Union mandates that the European Union and its member states must consider the objectives of development co‑operation in policies likely to affect developing countries. Additionally, they must take into account the objectives approved within the context of the United Nations and other competent international organisations. The 2017 European Consensus on Development reaffirmed the European Union’s commitment to PCD and recognised it as a crucial instrument to achieve the SDGs. It laid out PCD as an important contribution to the broader objective of PCSD, as embedded in the 2030 Agenda. Ensuring PCSD requires taking into account the impact of all policies on sustainable development at all levels: nationally, within the European Union, in countries outside of the European Union and globally.
← 6. Under Article 10 of the B-VG, the federal level is granted both legislative and executive competence in a defined set of policy areas, including foreign affairs and federal finances.
← 7. The Council of Ministers is the Federal Government’s weekly working meeting. All members of the Federal Government attend. This includes the Federal Chancellor, the Vice-Chancellor, the Federal Ministers and the State Secretaries (who, however, do not have the right to vote).
← 8. Article 15a of the B-VG provides a legal framework for co-operation and co‑ordination between the federal government (Bund) and the states (Länder) in the formulation and implementation of laws in certain policy areas. It applies particularly to policy areas requiring shared responsibility to achieve effective governance. This facilitates legislative and executive co-operation while promoting harmonisation of policies.
← 9. All federal ministries are instructed trough a decision of the Council of Ministers 86/11 of 12 January 2016 to incorporate the principles of the 2030 Agenda and its SDGs into relevant sectoral strategies and programmes within their areas of competences, and, where appropriate, develop targeted action plans and measures, involving all relevant government bodies and external stakeholders.
← 10. For example, the Austrian Security Strategy explicitly links national and international security to sustainable development and embeds coherent and co‑ordinated policy action as integral to achieving both security and sustainability objectives. The National Mobility and Internationalisation Strategy for Higher Education 2020‑2030 highlights its contribution to international knowledge transfer through co‑operation with universities in developing countries, notably the Africa-UniNet. The Federal Strategy for Research, Technology and Innovation (RTI Strategy 2030) includes coherence and sustainability as an evaluation dimension, which are assessed through internal and external evaluations.
← 11. The OECD Development Co-operation Peer Review of Austria of 2020 states that “Austria lacks the institutional arrangements or a mechanism to systematically identify, analyse and monitor the transboundary impacts of its domestic policies on developing countries.” (OECD, 2020[7])
← 12. Austria’s national raw materials strategy (Masterplan Rohstoffe 2030) has been criticised by civil society organisations for conflicting with Austria’s development policy objectives. The strategy is seen as failing to adequately address its negative impacts on countries of the Global South – such as environmental damage and human rights violations – and for lacking measures to ensure corporate transparency. This in turn contributes to tax avoidance and undermines resource mobilisation in partner countries.
← 13. Stakeholder engagement is a key component at all stages of the policy cycle: design, implementation and evaluation. To avoid duplication, however, this report primarily assesses engagement during the design phase.