COFOG level one, and to include the second level of the COFOG in the ESA 95 transmission tables,
other relevant improvements can be envisaged. Can this goal be reached without loosening the strength
of the fundamental characteristics mentioned above? The answer can be found inside the NA system
itself and it consists in the satellite account approach.
ESA95, par. 1.18, states:
“for some specific data needs the best solution is to draw up a separate satellite accounts. Cases in
point are the data needs for e.g.: the analysis of the costs and financing of health care; the analysis
of the importance of research & development and human capital for the national economy ...
etc.”^1.Furthermore, par. 1.19 states:
“satellite accounts can serve such data needs by:
a) showing more detail where necessary and leaving out superfluous detail;
b) enlarging the scope of the accounting framework by adding non-monetary information (...);
c) changing some basic concepts, e.g. by enlarging the concept of capital formation by amount of the
expenditure on research & development or the expenditure on education.”And the following par.1.20 adds:
“An important feature of the satellite accounts is that in principle all basic concepts and
classifications of the standard framework are retained. Only when the specific purpose of the
satellite account definitely requires a modification, are changes in the basic concepts introduced. In
such instances, the satellite account should also contain a table showing the link between the major
aggregates in the satellite account and those in the standard framework. In this way, the standard
framework retains its role as a framework of reference and at the same time justice is done to more
specific needs”.The proposals made in this paper follow this very simple – but rigorous – logic, which is able to produce
rapidly a significant output to be used in the economic analysis and, in the meantime, it is rooted in a
strategic horizon which can be approached progressively.
The main starting point to begin to draw the architecture of the information system on QPF should be the
statistics on General Government deficit and debt developed in the context of the excessive deficit
procedure (EDP). These statistics are implemented strictly applying the ESA95 rules, and are rigorously
monitored by Eurostat and supported by a very important methodological tool: “The Government Debt
and Deficit Manual”, which is continuously updated.
Namely, the deficit is the strategic aggregate which the Stability and Convergence Programmes of each
European country refers to and it is at the core of the control procedure of the soundness of public
finances. Therefore, it is the main reference aggregate along with other relevant statistical information,
which should be coherently gathered in order to build a harmonized data system on QPF. The
government deficit is the synthesis of the whole set of economic activity carried out by GG, i.e. the
difference between total revenues and expenditures as defined in the NA.
Only a well identified discrepancy differentiates EDP figures from NA deficit figures (net borrowing /
net lending) which relates to interest rate swaps and forward rate agreements (RFA) operations, so that:
(^1) Satellite accounts contain complementary information relative to the National Accounts and are mainly used as tools for
analysing in depth the situation in particular fields of National Accounts.