Sunday

13th Oct 2019

EU statistics still incoherent due to national differences

  • Governments use 'creative accounting,' making it difficult for Eurostat to figure out the reality behind the numbers (Photo: Jorge Franganillo)

Countries can no longer cook the books as Greece did for years in a row, but their reluctance to share data and adopt common accounting rules mean extra costs for the bloc's beefed-up statistics office.

January 2010 was to some extent 'D Day' for EU statistics. It was when Eurostat, after having expressed reservations for five years in a row, declared that the Greek authorities must have "deliberately misreported" their deficit data, Walter Radermacher, the chief of EU's statistics office recalled Monday (7 May) in the European Parliament.

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Eurostat has since gained audit powers and is now able to double-check the books of member states. Neither the Greek scenario, nor the pressure on Eurostat by Germany to allow Italy to join the euro in 1998 would be possible anymore, Radermacher said.

Germany's Der Spiegel magazine on Monday published government documents from that period showcasing the pressure put on Eurostat to give a green light to Italy despite its deficit.

"Back in the late 90s, there wasn't even a unit dealing with the financial sector, just a cell comprising of two-to-three people. For fiscal data we are living on a totally different planet compared to 1998," noted Rademacher, now in charge of an office employing 900 people.

What is still lacking are resources at national level "to control and co-ordinate what is going on there," he added, however.

"This is the missing link, to allow our colleagues in capitals to have the tools and powers to control what's going on in the country."

Even with its 900-strong staff, Eurostat itself could use more resources, as there is a growing demand for statistics, he went on.

"We are changing from a machinery which has taken statistics as an input to decision making to a more and more automatic decision making. There is a direct link between the indicator and the decisions."

EU member states already in 2009 agreed to have unified statistical criteria across the bloc, but they have been slow in implementing the agreement and some capitals still oppose it, explained Radermacher, a former chief of the German national statistics office.

"There is still a deeply anchored reluctance to share data and to discuss on data confidentiality at EU level," he said.

Common accounting standards are also not yet in place, with Eurostat having to spend extra time and money in matching the various criteria used by member states.

"There are many false objections, some say it's technical, others question if the cost of changing the standards will pay back," he said, adding that Eurostat will publish a study by the end of the year outlining the benefits of a single acccounting system.

Meanwhile, the office has devoted most of its resources in matching economic data on debt, deficits, GDP or exports. "The comparability has reached a level which is unique, assuring all players in the statistical community that the same rules apply," he said.

But this level of accuracy is not matched when it comes to other statistics. "Oysters counted in France and oysters in Spain will not have the same accuracy as debt and deficit. We call it fitness for purpose - for what do you need the comparability," the Eurostat chief said.

By 2014, the office hopes to include pension systems and innovative financial tools used by governments in the high-quality category.

National peculiarities in measuring exports, for instance, mean that some countries are carrying out double work: "Double measurements represent 50 percent of the entire administrative burden related to statistics."

"We are at a point in time where we need to make changes and implement what we agreed in 2009 - a European statistical system, not co-ordination of national systems," he said.

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