Integrated framework for environmental activity accts Arturo de

Integrated framework for environmental activity accts Arturo de la Fuente Eurostat

Background • There are many environmental activity accounts • They have drifted apart because • development over many years • Specialised approaches • optimisation case-by-case • other factors • We debate about this matter in Europe since 2013

Scope of the integration sought 1. 2. 3. 4. Environmental goods and services sector account (EGSS) Environmental protection expenditure account (EPEA) Resource management expenditure account (Re. MEA) Environmental subsidies and other transfers account (ESST) 5. Environmental taxes account (ETEA) Clean Technology Satellite Account, Bio-economy, Circular Economy, …

'Solution' proposed: modular approach ESST ETEA • 3 core accounts: EGSS, EPEA, Re. MEA • ESST narrow and deeper: specific topic, more variables, more breakdowns • ETEA is less integrated than the others

Accounting framework: production account (based on EGSS)

Accounting framework: expenditure account (based on EPEA & Re. MEA)

Integrated framework: What do we need? • Clear and unified terminology 1 term = 1 concept • Adjustments in • Definitions of some variables • Certain valuation rules • Groupings of classifications (CEPA & CRe. MA) • Adjustments in some accounts

Terminology • Environmental protection & Resource management • Characteristic & non-characteristic activities (*) • Specific products, cleaner products, resource efficient products (*) • Specific fixed assets, cleaner fixed assets, resource efficient fixed assets (*) • Specialist producers, secondary env producers, ancillary env producers (*) = changed item

Proposed EGSS • Coverage: • EP & RM • Characteristic & non-characteristic activities • Environmental goods and services • Variables: • Output, GVA, employment & exports • Intermediate consumption, compensation of employees, gross fixed capital formation (for the production of environmental products)(*) • Imports (*) • Valuation rules (unchanged) • Breakdowns: • SIC, CEA, type of products (specific, cleaner, resource efficient), type of output (market, non-market, ancillary, for own final use) • Focus on product breakdowns rather than institutional units

Proposed EPEA • Coverage • EP • Characteristic & non-characteristic activities (*) • Environmental goods and services (*) • Variables: • • Final consumption Intermediate consumption by specialist producers Transfers (with Ro. W) Variables coming from EGSS (*): intermediate consumption (of env products), GFCF, employment • Valuation rules: double valuation for cleaner products (*) • Breakdowns: • institutional sector, CEA, type of products (specific, cleaner, resource efficient) (*) • Re-focus on expenditure and transfers. Drop supply (*)

Proposed Re. MEA • Idem as EPEA but for resource management • Same accounting framework • Simplifications OK because of fewer data sources • Some breakdowns may be dropped • Some secondary variables may be dropped

Proposed ESST (subsidies) • Scope: • EP & RM • More transfers than EPEA: • • Subsidies on products (SNA D. 31) Subsidies on production (D. 39) Other transfers in SNA (D. 6, D. 7, D. 9) Other transactions beyond SNA: potentially environmental damaging subsidies, tax abatements, other support measures • Systematic collection all transfers across institutional sectors • Breakdowns: • ISIC, CEA, institutional sector

Proposed ETEA • Scope: taxes on all production activities, income taxes, capital taxes • Variables: • taxes on production and imports (SNA D. 2) • current taxes on income, wealth, etc. (D. 5) • capital taxes (D. 91) • Breakdowns: ISIC, type of tax (energy, transport, pollution, resource)

Questions for London Group • Do you agree with modular approach? • Core of 3 modules: EGSS, EPEA, Re. MEA? • ESST as specialised module supplementing the core modules? ETEA as specialised module separate? • Having a conceptual overall accounting framework ? • not reporting tables for data collections • Do you have comments to the details in paper for each of the modules?

Thank you! arturo. de-la-fuente@ec. europa. eu