TIMELINESS OF THE NATIONAL ACCOUNTS
The timeliness of statistical information refers to the delay between the reference period to which the information pertains and the date on which the information is made available. The timeliness of information also influences its relevance. Obviously, users want data that are as contemporary as possible.
The source data used to compile the national accounts are available with varying degrees of timeliness, frequency, accuracy and detail. Successive vintages of source data are likely to be more accurate. This is consistent with the nature of business accounting systems where sub-annual data from management information systems are updated and eventually replaced by audited annual accounts.
The ABS aims to collect the various vintages of source data as soon as satisfactory results are typically available from the respondents' own systems. These may not be final data, and in some cases businesses may not be able to respond in accordance with the set deadlines at all, resulting in an expected level of non-response. Survey systems are designed to impute values for late or non-responders. A consequence is that initial estimates are likely to be revised.
There is thus an important trade-off between the accuracy and reliability of the estimates and the timeliness of their release. To meet the decision making needs of users there is pressure to produce statistics in as timely a fashion and as frequently as possible. To the extent that complete or accurate data may not be available with the desired timing or can only be obtained at unacceptably high resource costs if at all, there will be compromises with data accuracy. Both accuracy and timeliness are characteristics of quality - the ABS relies on feedback from users as to the optimal balance between them.
The trade-off between timeliness, accuracy and detail is accommodated by way of the sequencing of releases of national accounts publications. The first published quarterly estimates are usually made available about 60-70 days after the reference period. The detailed annual estimates are released between 4 and 5 months after the reference period. The most detailed national accounts estimates relating to production, income and expenditure are contained in the input-output tables, which typically become available about 3.5 years after the reference period. Australia's national accounts rate well against those of other countries in terms of their timeliness - particularly when the level of detail made available is taken into consideration.
An OECD table, related to country announcements about the proposed release dates for the March quarter 2006 national accounts, showed quite a wide range of release dates. The Australian national accounts were released 68 days after the end of the quarter. Around half of the 30 countries in the table released their national accounts with a similar delay. 30% of countries released within 55 days or less, with Korea and the USA having the earliest release dates (25 and 28 days respectively). Countries in the euro area aim to release estimates of GDP growth around 45 days after the end of the quarter followed by estimates of GDP levels around 60 days, although the latter target in particular has not always been met. The IMF Special Data Dissemination Standard requires that countries release data for GDP and major expenditure aggregates and/or by productive sector no later than 90 days after the reference quarter.
The ABS is very aware of user needs for timely national accounts data. A major limiting factor is the ability of respondents to provide data from their own systems in a timely way. A study was recently conducted to trial the impact of an earlier cut-off date for key input data. The conclusion was that it was not possible to improve the timeliness of the quarterly release without an unacceptably adverse effect on accuracy. Over time there may be some potential to make a slight improvement in timeliness by process improvement within the national accounts compilation system itself, but this has also to be balanced by the ongoing desire to extend the range of statistics that can be made available.
A number of countries, particularly those that release national accounts estimates early, release a preliminary issue of the quarterly national accounts followed by later 'final' estimates. The preliminary releases are often based on a partial view of the economy and require a certain amount of forecasting. For example, where monthly production indexes are available it is possible to base a preliminary estimate of quarterly production-based GDP (GDP(P)) on two months data and forecast the third month. This obviously improves the timeliness of the national accounts as they can be released soon after the end of the quarter, although the preliminary releases are normally issued with caveats. The ABS has not chosen this approach, and monthly production indexes are not compiled that would enable this approach to be used.
On the annual source data side there are prospects for improvements to the timeliness of data that can be used for benchmarking preliminary estimates due to the implementation of the Business Statistics Innovation Program and the Annuals Integrated Collection Strategy. This may not result in more timely national accounts, but more accurate and cost effective national accounts.
The number of days between the end of the reference period and the release date is shown in the following graphs. There has been a marked improvement in the timeliness of the annual and state releases. Where the target line is not displayed, it is the same as the actual.