Abstract
The National Accounts consist of a set of information based on concepts, definitions, classifications, and statistical/accounting rules whose objective is to provide, for a given time period, a close representation of the economic reality of a given geographic space (country/region). They are the accounting base for the elaboration of the report on the deficits and public debts of the European Union countries, although the application of the National Accounts goes far beyond that of the general government.
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Notes
- 1.
Council Regulation No. 479/2009, revised by Council Regulation No. 679/2010, requires each Member State to report an EDP to Eurostat twice a year (March and September). Accordingly, Member States compile a set of accounts which is submitted to Eurostat as part of a regulated programme of the transmission of data used in key areas of the social, economic, and fiscal policy of the Union. These uses include the definition of the financial contributions of the Member States to the EU budget through the “fourth resource”, aid to the EU regions through the programme of structural funds, and the surveillance of the economic performance of the Member States in the framework of the procedure regarding excessive deficits and the Stability and Growth Pact.
- 2.
In 2014, the EU approved the transition from the ESA 95 to the ESA 2010, with implementation in October of that year. The ESA 2010 revised the regulations, classifications, and national accounting rules applicable to the Member States in the preparation of their National Accounts and in the transmission of data to the European Commission (Eurostat). This revision became necessary as a consequence of the large changes that were verified in society and the economy over the last 20 years, in particular with regard to the level of information and communications technologies, the growing importance of intangible assets involving research and development, intellectual property of products and services, and the phenomena associated with globalisation.
- 3.
Regulation (EU) No. 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European System of National and Regional Accounts in the European Union.
- 4.
The structure of the ESA 2010 manual is as follows (source: Eurostat 2016). “Chapter 1 covers the basic features of the system in terms of concepts and sets out the principles of the ESA and describes the fundamental statistical units and their groupings. It gives an overview of the sequence of accounts and a brief description of key aggregates and the role of supply and use tables and the input-output framework. Chapter 2 describes the institutional units used in measuring the economy and how these units are classified into sectors and other groups to allow analysis. Chapter 3 describes all transactions with regard to products (goods and services), as well as non-produced assets, in the system. Chapter 4 describes all the transactions in the economy which distribute and redistribute income and wealth in the economy. Chapter 5 describes the financial transactions in the economy. Chapter 6 describes the changes that can occur to the value of assets through noneconomic events or price changes. Chapter 7 describes balance sheets and the asset and liability classification scheme. Chapter 8 sets out the sequence of accounts and the balancing items associated with each account. Chapter 9 describes supply and use tables and their role in reconciling the measures of income, output, and expenditure in the economy. It also describes the input-output tables that can be derived from the supply and use tables. Chapter 10 describes the conceptual basis for the price and volume measures associated with the nominal values found in the accounts. Chapter 11 describes the population and labour market measures which can be used with measures of the National Accounts in economic analysis. Chapter 12 gives a brief description of quarterly National Accounts and how they differ in emphasis from the annual accounts. Chapter 13 describes the purposes, concepts, and compilation issues in drawing up a set of Regional Accounts. Chapter 14 covers the measurement of financial services provided by financial intermediaries and funded through net interest receipts and reflects years of research and development by Member States in order to have a measure which is robust and harmonised across Member States. Chapter 15 on contracts, leases, and licences is necessary to describe an area of increasing importance in the National Accounts. Chapters 16 and 17 on insurance, social insurance, and pensions describe how these arrangements are handled in the National Accounts, as questions of redistribution become of increasing interest as populations age. Chapter 18 covers the rest of the world accounts, which are the National Accounts equivalent to the accounts of the balance of payments measuring system. Chapter 19 on European accounts is also new, covering aspects of the National Accounts where European institutional and trading arrangements raise issues which require a harmonised approach. Chapter 20 describes the accounts for the government sector – an area of special interest as issues of fiscal prudence by Member States continue to be critical in the conduct of economic policy in the EU. Chapter 21 describes the links between business accounts and National Accounts, an area of growing interest as multinational corporations become responsible for an increasing share in gross domestic product (GDP) for all countries. Chapter 22 describes the relationship of satellite accounts with the main National Accounts. Chapters 23 and 24 are for reference purposes; Chapter 23 sets out the classifications used for sectors, activities, and products in the ESA 2010 , and Chapter 24 sets out the complete sequence of accounts for every sector”.
- 5.
“The ESA 2010 is based on the concepts of the 2008 SNA, which provides guidelines on national accounting for all countries throughout the world. Nevertheless, there are several differences between the ESA 2010 and the 2008 SNA:
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(a)
Differences in presentation:
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1.
In the ESA 2010 there are separate chapters on transactions in products, distributive transactions and financial transactions. In contrast, in the 2008 SNA these transactions are explained in chapters arranged by account, e.g. chapters on the production account, the primary distribution of income account, the capital account and the rest of the world account.
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2.
The ESA 2010 describes a concept by providing a definition and a listing of what is included and what is excluded. The 2008 SNA describes concepts usually in more general terms and explains the rationale behind the conventions adopted.
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1.
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(b)
The ESA 2010 concepts are in several instances more specific and precise than those of the 2008 SNA:
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1.
The 2008 SNA does not contain specific criteria on the distinction between market, for own final use and non-market categorisation of output. The ESA has therefore introduced more detailed guidance to ensure a uniform approach.
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2.
The ESA 2010 assumes that several types of household production of goods, such as the weaving of cloth and the making of furniture, are not significant in Member States and therefore need not be recorded.
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3.
The ESA 2010 makes reference to institutional arrangements in the EU, such as the Intra-state system for recording intra EU flows of goods and the contributions by the Member States to the EU.
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4.
The ESA 2010 contains EU-specific classifications, e.g. Classification of products by activity (CPA) (3) for products and NACE Rev. 2 for industries (both are harmonised with the corresponding UN classifications).
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5.
The ESA 2010 contains an additional classification for all external transactions: they are divided into those between residents of the EU and those with residents from outside the EU.
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6.
The ESA 2010 contains a rearrangement of the 2008 SNA subsectors for the financial corporations sector, to meet the needs of the European Monetary Union. The ESA 2010 can be more specific than the 2008 SNA, because the ESA 2010 primarily applies to the Member States. For the data needs in the Union, the ESA should also be more specific”. (Source: Eurostat 2016)
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1.
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(a)
- 6.
The ESA 2010, such as its predecessor, the ESA 1995, is of mandatory implementation in the European Union space, under Regulation (EU) No. 549/2013 from the European Parliament and from the European Council of 21 May of 2013.
- 7.
“The ESA 2010 exists alongside the 2008 SNA because of the uses of national accounts measures in the EU. The Member States are responsible for the collection and presentation of their own national accounts to describe the economic situation of their countries. Member States also compile a set of accounts which are submitted to the Commission (Eurostat) as part of a regulatory data transmission programme, for key social, economic and fiscal policy uses in the Union. Those uses include the determination of Member State monetary contributions to the EU budget via the “fourth resource”, aid to regions of the EU through the structural funds programme and surveillance of Member States’ economic performance in the framework of the excessive deficit procedure and of the Stability and Growth Pact”. (Source: ESA 2010)
“The following examples demonstrate uses of the ESA framework:
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(a)
monitoring and guiding the Euro Area macroeconomic and monetary policymaking, and defining criteria of convergence for the economic and monetary union (EMU) in terms of National Accounts figures (e.g. GDP growth rates);
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(b)
defining criteria for the excessive deficit procedure: measures of government deficit and debt;
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(c)
granting financial support to regions in the EU: the allocation of expenditure funds to regions uses Regional Accounts statistics;
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(d)
determining the own resources of the EU budget. The latter depend on National Accounts figures in three ways:
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1.
the total resources for the EU are determined as a percentage of the sum of Member States’ gross national incomes (GNI);
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2.
the third own resource of the EU is the VAT own resource. The contributions by the Member States for this resource are largely determined by National Accounts figures, because these figures are used to calculate the average VAT rate;
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3.
the relative sizes of the contributions by the Member States for the fourth own resource of the EU are based on their gross national income estimates. These estimates are the basis for the majority of Member States’ payments”.
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1.
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(a)
References
ESA (2010) European System of Accounts 2010. https://ec.europa.eu/eurostat/cache/metadata/Annexes/nasa_10_f_esms_an1.pdf
Eurostat (2016) Manual of government deficit and debt. https://ec.europa.eu/eurostat/documents/3859598/7203647/KS-GQ-16-001-EN-N.pdf/5cfae6dd-29d8-4487-80ac-37f76cd1f012. Accessed 1 Nov 2016
OECD (2006) Understanding national accounts. OECD, Paris
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Miranda Sarmento, J. (2018). The National Accounts. In: Public Finance and National Accounts in the European Context . Financial and Monetary Policy Studies, vol 47. Springer, Cham. https://doi.org/10.1007/978-3-030-05174-7_5
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