Documents considered by the Committee on 2 February 2011 - European Scrutiny Committee Contents

6   Statistics



+ ADDs 1-26

COM(10) 774

Draft Regulation on the European system of national and regional accounts in the European Union (Text with EEA relevance)

Legal baseArticle 338 TFEU; co-decision; QMV
Document originated20 December 2010
Deposited in Parliament11 January 2011
DepartmentOffice for National Statistics
Basis of considerationEM of 20 January 2011
Previous Committee ReportNone
Discussion in CouncilNot known
Committee's assessmentPolitically important
Committee's decisionNot cleared; further information requested


6.1  Each Member State's National Accounts and Regional Accounts are compiled in line with definitions, accounting rules and classifications as laid out by the European System of Accounts, ESA 1995, established by Regulation (EC) No 2223/96. The ESA 1995 system was set up to meet the requirements of the economic, social and regional policy of the EU. And it allows monitoring of the economies of the Member States and of the economic and monetary union, through the use of comparable, up-to-date and reliable information on the structure and developments in the economic situation of each Member State or region.

The document

6.2  This draft Regulation is to revise the existing EU guidelines for producing National Accounts and Regional Accounts to reflect the new economic environment, advances in methodological research and needs of users. The proposal is to embody an updated European System of Accounts, ESA 2010, revising ESA 1995 to reflect changes since 1995. ESA 2010 follows on from a revised International System of National Accounts, SNA 2008, published in 2009 by the IMF, the OECD, the UN Statistical Division, the World Bank and Eurostat. It reflects developments such as new industries and products, the impact of globalisation and the expansion of financial services.

6.3  The revision of the European System of Accounts has been discussed in several groups:

  • a steering group of Directors of National Accounts;
  • an ESA 95 Revision Group, addressing issues of common interest, alongside the National Accounts Working Group and Financial Accounts Working Group;
  • regular reporting to the European Statistical System Committee (representative of Member States' National Statistical Institutes) and the Committee on Monetary, Financial and Balance of Payments Statistics (senior statisticians of the National Statistical Institutes and central banks of Member States and the other members of the European Economic Area); and
  • Commission Directorates General.

Representatives from the National Statistical Institute and/or the central bank from each Member State have been involved in the various fora as appropriate. Both the Office for National Statistics and the Bank of England have taken a full part in appropriate meetings and discussions, as well as providing papers to help resolve methodological issues.

6.4  The draft Regulation has an annex providing a methodology on common standards, definitions, classifications and accounting rules. The annex has 24 chapters, dealing with overarching points, such as "general features and basic principles" (Chapter 1) or "quarterly national accounts" (Chapter 12), and a range of more detailed matters, such as "distributive transactions" (Chapter 4) or "contracts, leases and licences" (Chapter 15). A second annex sets out the programme required from Member States for transmitting for EU purposes the accounts, data and tables compiled according to the methodology to specified deadlines.

6.5  The draft Regulation:

  • would be extended to the European Economic Area;
  • is expected to be implemented by Member States by September 2014 — ESA 2010 will gradually replace all other systems as a reference framework of common standards, classifications and accounting rules for drawing up accounts of the Member States, so that results are comparable between Member States; and
  • would empower the Commission to adopt delegated acts for the purposes of amending the two annexes — the Commission would carry out appropriate consultations during its preparatory work, including at expert level.

In connection with delegated acts various matters have already been identified:

  • a task force has been set up to examine further the treatment of financial intermediation services indirectly measured (that is, measuring banks' activity covering interest paid or received on loans and deposits);
  • capitalisation of research and development expenditure, including a test exercise to establish the reliability of the data; and
  • various studies and work, including the development of a more comprehensive measurement approach for wellbeing.

The Government's view

6.6  The Minister for the Cabinet Office (Mr Francis Maude) says that the Government is content with the proposal, that there are no direct changes to policy but that many of the economic data series feeding into analyses used to either support establishing new policy or amend existing policy will change.

6.7  The Minister also says that:

  • the financial implications of meeting the requirements of the draft Regulation will be met from within the Office for National Statistics resource budget;
  • the Office for National Statistics has commenced work on assessing the impact, developing strategies and a programme of work including resource requirements to meet the proposed implementation date of September 2014;
  • the impact of this proposal will affect a range of economic statistics produced by the Office for National Statistics covering the National Accounts, Regional Accounts, Balance of Payments, Public Sector Finance, Environmental Accounts;
  • given the integrated and centralised manner in which many economic statistics are produced by the Office for National Statistics, this change will form a major programme of work;
  • the impact of data changes will affect Office for National Statistics customers and suppliers including other government departments, which the Office will reflect as part of the work programme;
  • there are no direct costs on business or the third sector resulting from the proposal; and
  • there will, however, be changes to the data collected via Office for National Statistics business surveys which may have an impact on the burden on business in terms of data needed — the Office will be seeking to implement any changes without increasing the compliance burden.


6.8  This draft Regulation clearly heralds a significant change for the EU's statistical system. We note that the Office for National Statistics and the Bank of England have been involved in the development of the revised European System of Accounts and that the Government is content with the draft Regulation. Nevertheless, we wish to be sure that the proposal remains acceptable during the process of its negotiation. Therefore we should like a progress report on the negotiations in six months time. Meanwhile the document remains under scrutiny.

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