FEATURE ARTICLE 1: IMPROVING MACRO–ECONOMIC STATISTICS


INTRODUCTION

In 2011 the ABS was allocated funding to improve the collection and analysis of macro–economic statistics. The funding was used to enhance the scope and quality of statistical outputs including the quarterly National Accounts.

To achieve its objectives, the ABS allocated the funding to six initiatives:

1. Quarterly Sector Accounts and Balance Sheets,
2. Quarterly Supply Use Tables and Improved Data Coherence,
3. International Trade (Goods and Services),
4. Financial Statistics,
5. Household Final Consumption Expenditure, and
6. Services Producer Price Indexes.

QUARTERLY SECTOR ACCOUNTS AND BALANCE SHEETS

The quarterly sectoral accounts consist of three types of accounts:

• Income Accounts - a disaggregation of the national income account which records the net income for each individual sector;
• Capital Accounts - reflects the net lending (balancing item) of a particular sector to all other sectors; and
• Financial Accounts - are compiled for each institutional sector and indicate how institutional units engage in financial transactions with each other.

Although the ABS has been publishing some of this data already, the funding has provided the capacity to quality assure quarterly source balance sheet data, improve coverage and quality of the Rest of World balance sheet and develop a full articulation of accounts.

A major milestone of the project was achieved in the September quarter 2013 release of the Financial Accounts, with the publication of the first quarterly Household Balance Sheet. The publication and associated analytical measures enhances the ability to formulate policy in response to short run dynamics of household income, consumption, saving and wealth.

The full set of quarterly sector accounts will be published in December 2014, in the September quarter 2014 issue of Australian National Accounts: National Income, Expenditure and Product (cat. no. 5206.0) and Australian National Accounts: Finance and Wealth (cat. no. 5232.0).


QUARTERLY SUPPLY USE TABLES AND IMPROVED DATA COHERENCE

As a part of the ongoing efforts to improve National Accounts, this project extended:

• Quarterly Supply Use Tables to include original series;
• Gross Domestic Product (GDP) to include current price measures;
• chain volume review of Trade;
• review of Inventories;
• non additivity of Gross Fixed Capital Formation (GFCF); and
• second hand sales of public sector assets to the private sector.

The project also included the collection of mining inventories and production volumes and supplementary Capital Expenditure items.

Additional Mining Industry data was published in 5204.0 - Australian System of National Accounts, 2010-11 and subsequently in the September quarter 2011 issue of 5206.0 - Australian National Accounts: National Income, Expenditure and Product.


INTERNATIONAL TRADE (GOODS AND SERVICES)

This project improves the quality of the Survey of International Trade in Services (SITS), enabling improvements to coverage and efficiencies in data collection. It also enhances the quality of Merchandise trade quantity data (used to compile volume measures in the National Accounts), Balance of Payments (BOP) major capital expenditure projects, improves international trade transactions in government services, and Government Finance Statistics data in general.

A significant component of this project focused on improving the quality of the quarterly SITS, a primary input to Australia's Trade in services statistics. Through linking the SITS frame to the ABS Business Register, adopting data collection and editing systems similar to those employed by other economic collections and streamlining the systems adopted in modelling estimates for non-surveyed service types, significant improvements have been made to data quality. These changes also allow for improved timeliness and a reduction in the level of revisions which provides a better quality output for our users.


FINANCIAL STATISTICS

The completion of this project will result in quality assured quarterly Australian Prudential Regulation Authority (APRA) and ABS Income and Expense data leading to improved quality of the Financial Accounts.

The funding will ensure the ABS continues to be able to capture, edit and disseminate data sourced from APRA via the tripartite data sharing agreement in place between APRA, the Reserve Bank of Australia and ABS. The project will use quarterly APRA balance sheet data from Authorised Depository Institutions and Registered Financial Corporations data as well as data from registered superannuation entities and general insurers.

The development of operating systems and processes will facilitate annual and quarterly compilation and deliver Financial Income estimates. The annual process will enable not only the production of series that feed directly into the Australian System of National Accounts, 5204.0 process but also the compilation and delivery of annual series to the National Accounts Benchmarks Section for the purposes of producing annual benchmarks.


HOUSEHOLD FINAL CONSUMPTION EXPENDITURE

Retail Trade contributes approximately 30% of quarterly estimates of HFCE in the expenditure side of Gross Domestic Product (GDP). Historically the contribution to HFCE was 55-60%, but has fallen over time as household expenditure patterns have gradually shifted from goods to services. This project expands Retail Trade from traditional retailing to service activities in the leisure, travel, recreation and entertainment sectors of the economy.

The expansion of coverage has commenced with the establishment of two new quarterly collections: the Survey of Consumer Sales - Energy Retailing and the Survey of Consumer Sales - Communications Services. The Energy Retailing survey provides estimates of the value of sales of electricity and gas to consumer customers, and the Communications Services survey provides estimates of the value of sales of mobile, fixed line and fixed internet services to consumer customers.

Further achievements include the enhancement of the existing monthly Retail Trade collection to include Experimental Estimates of Online Retail Turnover by domestic retailers. It was published for the first time in the September quarter 2013.


SERVICES PRODUCER PRICE INDEXES

Producer Price Indexes were traditionally developed around tangible industries such as mining, agriculture and manufacturing. However, as the modern economy moves towards intangible inputs (including services based economies) as an important driver of growth, the ABS recognises the importance of this transition and the need to prioritise this statistical project.

This project improves coverage, robustness, timeliness and the quality of new and existing Services Producer Price Indexes (SPPI).

The first of several indexes based on administrative data were implemented in the September quarter 2012 Producer Price Indexes publication in conjunction with the completion of the PPI review. Additional indexes have been progressively implemented into the SPPI structures from the September quarter 2012.