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Finance failures

A catastrophic breakdown in the system for managing financial investments at all levels and deliberate evasion of the supervisory rules is how Salzburg's financial controller David Brenner (Social Democrat Party) summed up the investment scandal in a report on Wednesday night on Austrian television.

As financial head for the Salzburg area he said he was stunned by the speculation scandal in the region. He said: "That's why it's important that we get an independent report that explains once and for all an issue that appears in the media everyday."

As promised, Brenner presented that independent report to the relevant parliament committee on the financial status of the Salzburg-region. According to that report, there is no deficit from the scandal - as yet. On the contrary, the figures show a surplus of 74 million Euros.

On the one hand, he said one could come out relatively unscratched. Brenner added: "We have a slight plus in our balance, but on the other hand, we have, over several years, invested in an unbelievable quantity, which even for me is unimaginable passing by all supervising rules in the process.

People have also been avoiding rules in politics, in audit courts and internal organs. Brenner said: "That's the big question that remains: how are we going to resolve this? We have an entire system failure, and on all levels. As Salzburg's financial consultant, I don't exclude myself to me, like everyone else, that fact hasn't gone unnoticed."

Brenner said there are sector in accountancy that aren't even represented in the budget.

He said: "That explains one of the main problems of the system. For that reason, there are discussions to opt out of that type of accounting and towards a balance which will be designed in another way in the future. It's about transitory accounts and overdraft facilities for the regions who appear in the public, but not the companies, who operate in the background. That has to change."

Brenner is for a complete opt-out from this type of investments in finance and speculations enterprises.

He said: "We can't act head over heels. If we do that, we could create losses that aren't necessary. In a first instance, we swiftly have to make sure we protect the currency risks. Then we have to stabilise the interest rate risks. In a third step, in a year to a year and a half, we could opt-out of these enterprises entirely."

This plan has not yet been transparent or controllable, said Brenner: "The answer can only be a complete opt-out. Such investments should not be allowed in the future."

Brenner confirmed the status of the current financial report. He said: "To resolve the problems, we have to create a manageable structure. We can't stay stuck in these campaigning-like battles. But it is clear that no one can say at the moment whether this or that measure will have an effect or an other. There is no one that can tell us today where the interest rates will lie in three months' time."

According to the regional finance consultant, there is only one direction we need to be heading in: "And that's an advantage. Until now, we only had rumours, media-hysteria and political stagings from the VP (Christian-democrats). Today, we know more."

Austrian Times

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