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Document 52013DC0088
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the quality of fiscal data reported by Member States in 2012
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the quality of fiscal data reported by Member States in 2012
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the quality of fiscal data reported by Member States in 2012
/* COM/2013/088 final */
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the quality of fiscal data reported by Member States in 2012 /* COM/2013/088 final */
REPORT FROM THE COMMISSION TO THE
EUROPEAN PARLIAMENT AND THE COUNCIL on the quality of fiscal data reported by
Member States in 2012 TABLE OF CONTENTS 1........... BACKGROUND.......................................................................................................... 3 2........... MAIN FINDINGS ON THE 2012
REPORTING OF GOVERNMENT DEFICIT AND DEBT LEVELS 3 2.1........ Timeliness, reliability and
completeness............................................................................ 3 2.1.1..... Timeliness....................................................................................................................... 3 2.1.2..... Reliability........................................................................................................................ 4 2.1.3..... Completeness of tables and
supporting information.......................................................... 4 2.1.4..... Supplementary tables relating to
the financial crisis........................................................... 5 2.1.5..... Questionnaire on intergovernmental
lending...................................................................... 6 2.2........ Compliance with accounting rules
and consistency of statistical data................................. 6 2.2.1..... Exchange of information and
clarifications........................................................................ 6 2.2.2..... Dialogue and methodological visits.................................................................................. 6 2.2.3..... Specific advice by Eurostat............................................................................................. 7 2.2.4..... Recent methodological issues.......................................................................................... 7 2.2.5..... Consistency with underlying
government accounts............................................................ 8 2.3........ Publication...................................................................................................................... 8 2.3.1..... Publication of headline figures
and detailed reporting tables.............................................. 8 2.3.2..... Reservations on the quality of
data.................................................................................. 9 2.3.3..... Amendments to the reported data................................................................................... 9 2.3.4..... Publication of metadata
(inventories)............................................................................. 10 3........... Conclusions........................................................................................................ 10 1. Background Article 8(3) of Council Regulation (EC) No
479/2009 (amended by Regulation (EC) No 679/2010), on the application of the
Protocol on the excessive deficit procedure (EDP) annexed to the Treaty
establishing the European Community[1]
requires the Commission (Eurostat) (hereinafter referred to as “Eurostat”) to
report regularly to the European Parliament and to the Council on the quality
of the actual data reported by Member States. This annual report provides an
overall assessment of timeliness, reliability, completeness, compliance with
accounting rules and consistency of the data. The previous report (on the 2011
notifications) was adopted by the Commission on 13 April 2012. Eurostat regularly assesses the quality of the
actual data reported by Member States and of the underlying general government
sector accounts compiled in accordance with Council Regulation (EC) No 2223/96
of 25 June 1996 on the European system of national and regional accounts in the
Community (ESA95)[2].
This work concentrates on the factors that explain the general government
deficit/surplus and the change in the general government debt. Member States
send this information to Eurostat twice per year. This also includes
supplementary information such as the “Questionnaire related to the EDP
notification tables”, the "Supplementary table for the financial crisis"
and bilateral clarifications by Member States. Eurostat also maintains an on-going
dialogue with Member States by undertaking regular EDP dialogue visits. This report is based on the main findings and
results of the EDP reporting in 2012, focusing on the latest exercise of
October 2012. Where appropriate, comparisons are made with the April 2012
reporting, as well as with the 2011 reportings. 2. Main
findings on the 2012 reporting of government deficit and debt levels 2.1. Timeliness, reliability and
completeness 2.1.1. Timeliness Member States are required to report their
actual and planned EDP data to the Commission twice per year, before 1 April
and 1 October[3].
During 2012, the EDP reporting covered the years 2008 to 2012. The figures for
2012 are those planned by the national authorities, while the 2008 to 2011
figures are actual data (this means final, semi-finalised, provisional or
estimated figures). Eurostat does not check the planned data reported by Member
States. This is the responsibility of DG ECFIN. Compliance with the reporting deadlines is
usually very good. In 2012 all Member States reported their actual data before
the legal deadline in both EDP notifications. As concerns planned data, in the
April 2012 reporting exercise, all Member States reported their figures before
1 April 2011, except France, which sent the planned data for the year 2012 on 6
April. 2.1.2. Reliability Revisions between the April 2012 and the
October 2012 notifications were mainly due to source data updates, sector
re-classification of units, the recording of interventions undertaken by
government in the context of the financial crisis and methodological changes.
As usual, debt was revised less than deficit between April and October. The largest revisions in the deficit took place
in Spain and Ireland. In Spain, the deficit was revised upwards between the
April and October 2012 EDP notifications for years 2010 and 2011 due to the
previously unrecorded unpaid bills related to health expenditure in the state
and local government sub-sectors and due to the re-classification of capital
injections by central government into three banks. In Ireland, the biggest revision took place for the year 2011, where the deficit was revised
upwards due to a revised capital transfer element of injections into two banks.
As for the debt, the largest revisions between
April and October were undertaken in the United Kingdom and Italy. In the United Kingdom, the reported debt for the years 2008 and 2009 decreased
considerably due to a change in the calculation of the relevant impact of
public defeasance structures, whereas in Italy the debt was revised upwards for
the whole period 2008-2011 due to the implementation of the Eurostat decision
on the recording of trade credits. Between April and October, there were noticeable
revisions in GDP for Greece for the years 2010 and 2011 and for Luxembourg for the years 2008 and 2009. As regards revisions undertaken within the
notification period, most Member States revised their reporting after the first
submission in October 2012. 35 revised submissions were sent by 23 countries, while
in April 2012, 38 revised submissions were sent by 22 countries. Member States
sent most of the revised submissions in response to comments, technical
questions or remarks by Eurostat, and they concerned completeness of missing
data, corrections of technical errors, internal inconsistencies, adjustments
provided in the notification tables or the related questionnaire or
inappropriate recording within tables. In the April and October reporting, revised
submissions within the notification period did not change substantially the
deficit and debt levels originally reported by Member States, except in the
October reporting, where the deficit figure was revised by -0.2 percentage
points (pp) of GDP during the notification period for Ireland. 2.1.3. Completeness
of tables and supporting information Completion of the reporting tables is a legal
obligation and is essential for a proper assessment by Eurostat of the quality
of the data. Article 8(2) of Regulation (EC) No 479/2009 as amended,
specifies that Member States must provide Eurostat with the relevant
statistical information, which“(…) in particular (…) means: (a) data from national accounts; (b) inventories; (c) EDP notification tables; (d) additional questionnaires and
clarification related to the notifications.” There are four main EDP notification tables.
The completion of EDP tables 1 to 3 is a legal obligation, whereas the
reporting of EDP Table 4 was agreed by Member States[4]. Tables 1 and 2A (central
government) cover the years 2008 to 2012, whilst the other tables cover the
years 2008 to 2011[5]. Most Member States completed all EDP
notification tables[6].
However in the October 2012 reporting, for EDP Tables 2, three Member States
either did not provide full details on the link between the working balance and
the EDP surplus/deficit for all the sub-sectors (mainly for local government)
or for all the years, or reported working balances equal to the EDP
surplus/deficit. For EDP Table 3, not all Member States provided
all the breakdowns. In particular the details requested for the items 'loans'
and 'equity' were not always reported. In addition, several countries have a
practice of reporting zero statistical discrepancy, which would normally imply
that the discrepancy is incorrectly included under 'other accounts receivable
/payable'. Despite improvements achieved in some Member
States, the overall coverage of Table 4 remains inadequate in many cases. In
particular, several countries are not providing complete data for the stock of
liabilities of trade credits and advances. All Member States submitted replies to the
“Questionnaire relating to the notification tables”[7]. Although the coverage and
quality of answers continued to improve compared to past years, progress is
still necessary, as some countries did not report all the details requested in
the questionnaire. This applies notably to data on central government claims
and debt cancellations, the breakdown of other accounts receivable/payable and
the recording of government guarantees (mainly the coverage of the local
government subsector). The completeness of EDP tables can still be
improved. However, the remaining issues are expected to have little impact on data
quality. 2.1.4. Supplementary
tables relating to the financial crisis Eurostat has been collecting a set of data on
the financial crisis in a supplementary table since 15 July 2009. Part 1
of the supplementary table relates to data on transactions which are recorded
in the revenue/expenditure account of government and have an actual impact on
the EDP deficit/surplus. Part 2 of the supplementary table relates to data
on stocks of financial assets and liabilities arising from the support for
financial institutions. It distinguishes between activities which have actually
contributed to government liabilities (included in government debt) and
activities which may potentially contribute to government liabilities in the
future, but are for now considered as contingent on future events (not included
in government debt). These tables show government interventions directly
related to the support of financial institutions. Support measures for
non-financial institutions or general economic support measures are not
included. The data collected in 2012 referred to the
period 2007 to 2011. All but seven Member States (Bulgaria, the Czech Republic, Estonia, Malta, Poland, Romania and Slovakia) reported various interventions
undertaken by government in the context of the financial crisis during the
2007-2011 period. Eurostat published a note alongside its EDP Press Releases
analysing these data[8].
2.1.5. Questionnaire
on intergovernmental lending Starting from the April 2011 notification, the
Member States also provide data on intergovernmental lending in the context of
financial rescue operations. The EDP News Release includes this information,
which allows the analysis of loans Member States grant for support operations
to other Member States (in 2011, mainly to Greece, Ireland and Portugal). Such intergovernmental lending increased
substantially in the context of the financial crisis and has to be subtracted
from the EU27 and euro area aggregates of the Maastricht debt, both of which
are calculated on a consolidated basis. Due to this consolidation, the EU27 and
euro area aggregates are not equal to the arithmetical sum of Member States’
debt (i.e. the above mentioned intergovernmental lending between governments is
not included, to avoid double-counting). The figures reported in the questionnaire for the
year 2011 include the amounts in relation to the European Financial Stability
Facility (EFSF). 2.2. Compliance
with accounting rules and consistency of statistical data 2.2.1. Exchange
of information and clarifications During the assessment period between the
reporting deadline of 1 October and the publication of the data on 22 October
2012, Eurostat contacted the national statistical authorities in every Member State to request further information and to clarify the application of the accounting
rules on specific transactions. This process involved several rounds of
correspondence between Eurostat and the national authorities. A first round of
requests for clarification was sent to all countries before 5 October. A second
round of requests was sent to 23 countries and a third round to three
countries. For some countries, Eurostat asked for revised notification tables[9]. 2.2.2. Dialogue
and methodological visits Regulation (EC) No 479/2009 as amended, makes
provision for dialogue and methodological visits. Dialogue visits, including
the new so-called 'upstream dialogue visits', to Member States are conducted
regularly with the aim of reviewing reported data, examining methodological
issues, discussing statistical sources and assessing compliance with the
relevant accounting rules, for example on the delimitation of general
government, the time of recording and the classification of government
transactions and liabilities. During the year 2012, Eurostat carried out the
following EDP dialogue visits: Austria (17-19 January, upstream dialogue
visit), Lithuania (8-9 February), Latvia (15-16 February), Bulgaria (27-29
February), Belgium (5-7 March and 4 September, upstream dialogue visits, and 27
June standard dialogue visit), Greece (22-23 March and 24-25 September),
Slovakia (3-4 May), Czech Republic (22-24 May, upstream dialogue visit), Malta
(22-23 May), Spain (18-22 June and 11-14 September, both upstream dialogue
visits) Austria (25-26 June), Hungary (10-11 July), Ireland (30-31 August),
France (10-11 September), Cyprus (26 September), Czech Republic (13-14
November), Italy (19-21 November, upstream dialogue visit), Portugal (22-23
November) and Denmark (29-30 November). Furthermore, a technical visit was
undertaken to Spain on the 24 May 2012 and two visits (technical and
pre-accession) took place to Croatia as future Member State. Recurring issues discussed during the visits
included the classification of units within or outside the general government
sector (e.g. concerning public transport, television and radio, hospitals and
universities), capital injections, Public-Private Partnerships, EU flows, the
recording of guarantees, and overall quality management of upstream data flows.
Due attention is being given to Member States with decentralised structures,
such as autonomous regions. Every visit leads to a number of action points for
the Member State. The implementation of these action points leads to
improvements in data quality over time. The final findings of each dialogue
visit, including a description of the action points agreed, and its state of
play, are sent to the Economic and Financial Committee and published on the
website of Eurostat. Methodological visits are undertaken only where
Eurostat has identified significant risks or problems with respect to the
quality of the data, especially relating to the methods, concepts or
classifications used. No such methodological visits were carried out during
2012. 2.2.3. Specific
advice by Eurostat Member States regularly consult Eurostat to
clarify various national accounting issues in relation to future or past
operations. Eurostat provides advice in accordance with the existing
guidelines. To comply with the transparency provision in Regulation (EC) No
479/2009, as amended, Eurostat publishes its advice[10], unless the Member State concerned raises an objection. Eurostat published the following advice in 2012:
the accounting treatment of capital injections into Irish banks, the treatment of
a capital injection ('Gesellschafterzuschuss') and a state guarantee granted to
KA Finanz AG in Austria, the statistical
recording of the early repayments of mortgage loans at preferential exchange
rates and the related tax rebate in Hungary, the recording
of payment obligations established by Court decision with retroactive effect
in Romania, the methodological
treatment of government injections in the revaluation reserves of the Magyar
Nemzeti Bank in Hungary, and the recording of payments related to
the reimbursement of social contributions incorrectly calculated in 2011-2012
in Romania. 2.2.4. Recent
methodological issues As usual, Eurostat paid close attention to the
application of the ESA95 rules and, in particular, to its latest decisions.
These decisions are included in the Manual on Government Deficit and Debt, the
latest version of which was published in March 2012[11], and which is now subject to an
annual update process. In July 2012, Eurostat published its decision
on "The statistical recording of some operations related to
trade credits incurred by government units"[12]. In April 2012 Eurostat published a guidance note
on "The impact on EU Governments' deficit and debt of the decisions
taken in the 2011-2012 European summits"[13]. In July 2012, the note
on "The impact of bank recapitalisation on government finance"[14], completed the previous one,
providing guidance on capital injections in banks and the classification of
publicly supported "bad banks". 2.2.5. Consistency with underlying
government accounts The notification deadlines of 1 April and 1
October set by Regulation (EC) No 479/2009 as amended, were introduced in
order to ensure consistency with the underlying annual and quarterly government
sector accounts, as reported to Eurostat in various ESA95 transmission tables.
Eurostat systematically analyses the consistency of the EDP notifications with
the underlying government sector accounts. For example, total government
expenditure and revenue should be consistent with the reported deficit figure. The overall consistency of EDP data with the
reported ESA95 government accounts has improved in recent years, though it is
still better for non-financial than for financial data. In the October 2012
reporting, consistency between EDP figures and ESA tables (at both annual and
quarterly level) was complete for the non-financial data. However, efforts by
Member States are still needed in order to ensure the consistency between EDP
and ESA tables as regards financial data. Noticeable inconsistencies between
the EDP data and the quarterly financial accounts appeared in the October 2012
reporting for six Member States, and inconsistencies between EDP data and ESA
annual financial accounts in the stock of liabilities of trade credits and
advances existed for one third of the Member States. The level of consistency
of EDP debt and ESA quarterly government debt was complete for all Member
States. 2.3. Publication 2.3.1. Publication
of headline figures and detailed reporting tables Article 14 of Regulation (EC) No 479/2009
as amended, states: “The Commission (Eurostat) shall provide the actual
government deficit and debt data for the application of the Protocol on the
excessive deficit procedure, within three weeks after the reporting deadlines
(…). This provision of data shall be effected through publication.” The government deficit and debt data were
published on 23 April[15]
and 22 October[16]
2012 together with all the reporting tables, as notified by the Member States. Since
January 2012, Eurostat publishes a press release on quarterly Maastricht debt,
at approximately T+115 days. Eurostat also publishes on its website the
annual and quarterly government finance statistics that underpin the EDP data,
together with a note on the stock-flow adjustment[17]. Furthermore, Eurostat
publishes the information provided by Member States concerning government
interventions in the context of the financial crisis[18] and the data on
intergovernmental lending. In October 2012, Eurostat has published for the
first time a note on the stock of liabilities of trade credits and advances[19]. In accordance with Regulation (EC)
No 479/2009 as amended, Member States shall make public their actual data
on deficit and debt. All Member States publish deficit and debt figures at
national level. Most Member States have reported to Eurostat a practice of
publishing all their reporting tables. Five Member States publish only some of
the reporting tables and one Member State, France, does not publish EDP tables
at national level. 2.3.2. Reservations
on the quality of data Eurostat expressed two reservations on the
quality of the data notified by Ireland in the April 2012 notification. Both
reservations were withdrawn in the October 2012 assessment period. Ireland:
Eurostat has withdrawn a specific reservation,
expressed in April 2012, on the data reported by Ireland, relating to the fact
that restructuring plans of Allied Irish Banks and Irish Life & Permanent
(in 2012 renamed as Permanent TSB) were not yet finalised. The Central
Statistics Office of Ireland and Eurostat have examined updated restructuring
plans sent to the EU Competition authorities. These plans form a suitable basis
for partitioning the July 2011 injections in Allied Irish Banks and Permanent
TSB into deficit-increasing and non-deficit increasing components. This has
been implemented in revised data reported by Ireland. Eurostat has also withdrawn a specific reservation, expressed in April 2012, on the data reported
by Ireland, relating to the statistical classification of National Asset
Management Agency Investment Limited (NAMA-IL). On the basis of documents
provided by the Central Statistics Office of Ireland, NAMA-IL is majority
privately-owned, following the sale by Irish Life of its stake in NAMA-IL to a
private investor. This is a necessary condition for a special purpose entity to
be classified outside the General Government sector, pursuant to Eurostat’s
decision of 15 July 2009 on public interventions during the financial crisis. 2.3.3. Amendments
to the reported data Eurostat amended the data reported by the United Kingdom in the April 2012 EDP Notification. This amendment was withdrawn in the
October 2012 assessment period. United Kingdom:
The UK Office for National Statistics has reclassified Bradford & Bingley
and Northern Rock Asset Management to the General Government sector, in line
with the financial defeasance chapter of the Manual on Government Deficit and
Debt. Consequently, Eurostat is no longer amending the deficit and debt data
reported by the United Kingdom with respect to public financial defeasance
structures. 2.3.4. Publication
of metadata (inventories[20]) Regulation (EC) No 479/2009 as amended,
specifies that the EDP inventories are among the statistical information to be
provided by Member States to allow Eurostat to check compliance with ESA95
rules. Furthermore, it stipulates that national publication of these
inventories is mandatory. Eurostat has published the inventories of all Member
States. Except for Luxembourg and the Netherlands, all Member States reported
that they have published their EDP inventories nationally. In 2012 Eurostat has introduced a new EDP
inventory format which would involve structural changes and require more
detailed information (for example, with respect to compilation procedures,
delimitation of the general government sector, specific transactions, quality
management, and upstream data sources etc.). The new EDP inventories will be
published by Eurostat by the end of 2013. 3. Conclusions Eurostat has been introducing amendments and/or
reservations on the quality of reported data since the year 2006. For the first
time, in October 2012, Eurostat has neither expressed reservations nor amended
the data in the EDP notification. In addition, the two reservations expressed
for Ireland, and the amendment to the data for the United Kingdom in April
2012, were all withdrawn in the October 2012 EDP notification. Eurostat acknowledges overall improvements in
the consistency and completeness of the reported data. Nevertheless, some
issues persist, and Member States should step up efforts in order to improve
the coverage and quality of the trade credits reported and the completeness of
data on the sub-national government levels. Moreover Eurostat is closely
monitoring the system for the reporting by autonomous regions and the recording
of interventions undertaken by government in the context of the financial
crisis (bank recapitalisations). Overall, Eurostat concludes that the progress
on the quality of the reporting of fiscal data continued in 2012. In general,
Member States have provided better information, both in EDP notification tables
and in other relevant statistical returns. [1] OJ
L 145, 10.6.2009, p. 1. [2] OJ
L 310, 30.11.1996, p. 1. [3] Article
3 (1) and (3) of Regulation (EC) No 479/2009, as amended. [4] See
the statements to the Council minutes of 22 November 1993. [5] Provision
of planned data in EDP tables other than table 1 and 2A is not explicitly
requested in Council Regulation (EC) No 479/2009, as amended. [6] The
EDP notification tables reported by Member States can be found on Eurostat’s
website. See: http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/excessive_deficit/edp_notification_tables [7] This
questionnaire comprises thirteen sections requesting quantitative and sometimes
qualitative information in several areas, such as transactions in taxes and
social contributions and with the EU, acquisition of military equipment,
government guarantees, debt cancellations, capital injections made by
government into public corporations, Public-Private Partnerships, etc. [8] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/documents/Background_note_fin_crisis_Oct_2012_final.pdf
[9] See
section 2.1. [10] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/methodology/advice_member_states [11] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/product_details/publication?p_product_code=KS-RA-12-003 [12] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/documents/Statist.record.of_some_operations_rel.to_trade_credits_i.pdf [13] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/documents/Note_on_statistical_implications_of_summits-updated-12_A.pdf [14] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/documents/The_impact_of_bank_recapitalisations_on_government_fina1.pdf [15] See:http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-23042012-AP/EN/2-23042012-AP-EN.PDF [16] See:http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-22102012-AP/EN/2-22102012-AP-EN.PDF [17] See: http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/STOCK_FLOW_2012_OCT/EN/STOCK_FLOW_2012_OCT-EN.PDF.
[18] See: http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/excessive_deficit/supplementary_tables_financial_turmoil [19] See:
http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/documents/Note_on_AF.71L-Oct_2012.pdf [20] Inventories
of the methods, procedures and sources used to compile actual deficit and debt
data and the underlying government accounts.