4603.0.55.001 - Discussion paper: Towards an Environmental Expenditure Account, Australia, August 2014 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 06/08/2014  First Issue
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Adapted goods

They are goods that have been specifically modified to be more "environmentally friendly" or "cleaner" and whose use is therefore beneficial for environmental protection and resource management.

Ancillary activity

An ancillary activity is a supporting activity undertaken within an enterprise in order to create the conditions within which the principal or secondary activities can be carried out.

Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006

The ANZSIC is the standard classification used in Australia and New Zealand for the collection, compilation, and publication of industry statistics.

Basic price

The amount receivable by the producer from the purchaser for a unit of a good or service produced as output, minus any tax payable plus any subsidy receivable, on that unit as a consequence of its production or sale; it excludes any transport charges invoiced separately by the producer.

Compensation of employees

Compensation of employees is defined as the total remuneration, in cash or in kind, payable by an enterprise to an employee in return for work done by the latter during the accounting period.

Consumption of fixed capital

This is the decline, during the course of accounting period, in the current value of the stock of fixed assets owned and used by a producer as a result of physical deterioration, normal obsolescence or normal accidental damage.

Environmental account

An information system and framework that links the economic activities and uses of a resource to changes in the natural resource base, thus linking resource use with the System of National Accounts. See also SEEA.

Environmental protection activities

They are those activities whose primary purpose is the prevention, reduction and elimination of pollution and other forms of degradation of the environment.

Environmental protection specific services

Environmental protection services are produced by economic units for sale or own use.

Environmental related connected products

Products whose use directly serves environmental protection/resource management purposes but which are not environmental protection/resource management specific services or inputs into characteristic activities.

Final consumption expenditure

Final consumption expenditure is the amount of expenditure on consumption of goods and services.

Final consumption expenditure by General governments

General government final consumption expenditure consists of expenditure, including expenditure whose value must be estimated indirectly, incurred by general government on both individual consumption goods and services and collective consumption services.

Final consumption expenditure by households

Net expenditure on goods and services by persons and expenditure of a current nature by private non-profit institutions serving households. This item includes expenditures by unincorporated businesses and expenditures on assets by non-profit institutions (included in gross fixed capital formation). Also excluded is expenditure on maintenance of dwellings (treated as intermediate expenses of private enterprises), but personal expenditure on motor vehicles and other durable goods and the imputed rent of owner-occupied dwellings are included. The value of 'backyard' production (including food produced and consumed on farms) is included in household final consumption expenditure and the payment of wages and salaries in kind (e.g. food and lodging supplied free to employees) is counted in both household income and household final consumption expenditure.

Final consumption expenditure by NPISHs

Final consumption expenditure of NPISHs consists of the expenditure, including expenditure whose value must be estimated indirectly, incurred by resident NPISHs on individual consumption goods and services and possibly on collective consumption services.

General Government

The general government sector as used in this publication mainly comprises local government administration units (ANZSIC Division O, Class 7530) including regional councils which provide waste and other services on behalf of member councils.

Gross fixed capital formation

Gross fixed capital formation in a particular category of fixed asset consists of the value of producers’ acquisitions of new and existing products of this type less the value of their disposals of fixed assets of the same type. Gross fixed capital formation is measured by the total value of a producer’s acquisitions, less disposals, of fixed assets during the accounting period plus certain specified expenditure on services that adds to the value of non-produced assets.

Gross value added

The value of output at basic prices minus the value of intermediate consumption at purchasers' prices. The term is used to describe gross product by industry and by sector. Basic prices valuation of output removes the distortion caused by variations in the incidence of commodity taxes and subsidies across the output of individual industries.


A group of two or more related or unrelated people who usually reside in the same dwelling, who regard themselves as a household, and who make common provision for food or other essentials for living; or a person living in a dwelling who makes provision for his/her own food and other essentials for living, without combining with any other person.

Industry value added (IVA)

IVA is an estimate of the difference between the market value of the output of an industry and the purchases of materials and expenses incurred in the production of that output.

The derivation of IVA for individual businesses depends on whether they are classified as market or non-market producers. Non-market producers are those institutions which provide goods or services either free or at prices that are not economically significant. In other words, their prices are not significantly influenced by the amounts that producers are willing to supply, nor the amounts that users are willing to pay to purchase the goods or services being provided. Conversely, market producers provide goods and services at prices that are economically significant.

For market producers, the derivation of IVA is as follows:

      Sales and service income
          plus Funding from federal, state and/or local government for operational costs
          plus Capital work done for own use
          plus Closing inventories
          less Opening inventories
          less Purchases of goods and materials
          less Other intermediate input expenses
          equals IVA

However, it should be noted that IVA is a measure of economic activity and is not equivalent to operating profit before tax (OPBT). Wage and salary expenses, and most other labour costs, are not taken into account in the calculation for market producers, neither are interest expenses, depreciation or a number of lesser expenses. On the income side, OPBT includes total income, whereas IVA only includes sales and service income and government funding for operational costs.

As a principle, the output of non-market production is valued at cost, including intermediate input expenses. As shown in the above derivation, purchases and other intermediate input expenses are deducted from output in order to arrive at IVA.

Accordingly, the derivation of IVA for non-market producers can be described as follows:
      Selected labour costs
          plus Depreciation and amortisation
          equals IVA

Estimates of industry value added are obtained by summing the contributions of businesses classified to that industry, both market and (if any) non-market producers. Market producers predominate in most industries.

Industry value added is related to, but different from, the national accounting variable gross value added. For national accounts purposes, gross value added is calculated by adjusting IVA to include General government units and also to account for some other effects.

Intermediate consumption

Intermediate consumption consists of the value of the goods and services consumed as inputs by a process of production, excluding the consumption of fixed capital.


The process where units are engaged in the physical or chemical transformation of materials, substances or components into new products (except agriculture and construction). The materials, substances or components transformed by units in this division are raw materials that are products of agriculture, forestry, fishing and mining or products of other manufacturing units.

Market output

Market output consists of output intended for sale at economically significant prices.


The process where units extract naturally occurring mineral solids, such as coal and ores; liquid minerals, such as crude petroleum; and gases, such as natural gas from the earth, from an ore body, vein or (coal) seam. The term also includes the removal of soil. The term mining is used in the broad sense to include: underground or open cut mining; dredging; quarrying; well operations or evaporation pans; recovery from ore dumps or tailings as well as beneficiation activities (i.e. preparing, including crushing, screening, washing and flotation) and other preparation work customarily performed at the mine site, or as a part of mining activity.

Natural resources

Natural resources consist of naturally occurring resources such as land, water resources, uncultivated forests and deposits of minerals that have an economic value.

Non-market output

The non-market output produced by government units and NPISHs that is supplied free, or at prices that are not economically significant, to other institutional units or the community as a whole. The value of the non-market output is estimated as the sum of costs of production, as follows:
      a. Intermediate consumption
      b. Compensation of employees
      c. Consumption of fixed capital
      d. Other taxes (less subsidies) on production.

Non-profit institutions (NPIs)

Non-profit institutions are legal or social entities created for the purpose of producing goods and services but whose status does not permit them to be a source of income, profit or other financial gain for the units that establish, control or finance them.

Non-profit institutions serving households (NPISHs)

Non-profit institutions serving households (NPISHs) consist of non-market NPIs that are not controlled by government.

Non-specialist producers

The non-specialists producers produce environmental goods and services for sale but not as their primary activity.

Other industries

Industries other than those included in ANZSIC Division A Agriculture, Division B Mining, Division C Manufacturing, Division D Electricity, Gas, Water, Division E Construction, sub division 29 Waste Collection, Treatment and Disposal Services and Class 7530 Local Government Administration.

Other subsidies on production

Other subsidies on production consist of subsidies except subsidies on products that resident enterprises may receive as a consequence of engaging in production.

Other taxes on production

Consists of all taxes except taxes on products that enterprises incur as a result of engaging in production.


Output is defined as the goods and services produced by an establishment, excluding the value of any goods and services used in an activity for which the establishment does not assume the risk of using the products in production and excluding the value of goods and services consumed by the same establishment except for goods and services used for capital formation (fixed capital or change in inventories) or own final consumption.

Own-account activity

It consists of the production and use of goods and services within an establishment or household.


Production is an activity, carried out under the responsibility, control and management of an institutional unit, that uses inputs of labour, capital, and goods and services to produce outputs of goods and services.


Products are goods and services (including knowledge-capturing products) that result from a process of production.

Purchasers' price

The amount paid by the purchaser, excluding any deductible tax, in order to take delivery of a unit of a good or service at the time and place required by the purchaser. The purchaser’s price of a good includes any transport charges paid separately by the purchaser to take delivery at the required time and place.

Recyclable waste service

Services provided to treat or process waste materials so as to make suitable for reuse.


A resource recovery method involving the collection and processing of waste for use as a raw material in the manufacture of the same or similar non-waste product.

Research and development

Research and development consists of the value of expenditures on creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and use of this stock of knowledge to devise new applications. This does not extend to including human capital as assets within the SNA.

Resource management activities

They are those activities whose primary purpose is preserving and maintaining the stock of natural resources and hence safeguarding against depletion.

Resource recovery

The process of extracting materials or energy from a waste stream through re-use (using the product for the same or a different purpose without further production), recycling or recovering energy from waste.

Rest of the world (ROW)

The rest of the world consists of all non-resident institutional units that enter into transactions with resident units, or have other economic links with resident units.

Secondary activity

A secondary activity is an activity carried out within a single producer unit in addition to the principal activity and whose output, like that of the principal activity, must be suitable for delivery outside the producer unit.


The System of Environmental and Economic Accounting (SEEA) is a measurement framework that can provide a range of metrics that link information on the economy and the environment. This integration of information is achieved by the use of common frameworks, classifications and standards, providing an integrated database for policy analysis and decision making. In 2012 it was adopted as an international statistical standard by the United Nations Statistical Commission and applies the accounting concepts, structures, rules and principles of the System of National Accounts (SNA) to environmental information.

Solid waste

Waste materials ranging from municipal garbage to industrial waste, but excluding gaseous, liquid, hazardous, clinical and intractable wastes.

Specialist producers

Specialist producers are those producers whose primary activity is the production of environmental good and services.

Subsidy on product

A subsidy payable per unit of a good or service. The subsidy may be a specific amount of money per unit of quantity of a good or service, or it may be calculated ad valorem as a specified percentage of the price per unit. A subsidy may also be calculated as the difference between a specified target price and the market price paid actually paid by a purchaser. A subsidy on a product usually becomes payable when the product is produced, sold or imported, but it may also become payable in other circumstances, such as when a product is exported, leased, transferred, delivered or used for own consumption or own capital formation.

Supply table

A supply table at purchasers’ prices consists of a rectangular matrix with the rows corresponding to the same groups of products as the matching use tables and columns corresponding to the supply from domestic production valued at basic prices plus columns for imports and the valuation adjustments necessary to have total supply of each.


Taxes are compulsory, unrequited payments, in cash or in kind, made by institutional units to government units.

Taxes less subsidies on production

Taxes less subsidies on production consist of taxes payable or subsidies receivable on goods or services produced as outputs and other taxes or subsidies on production, such as those payable on the labour, machinery, buildings or other assets used in production.

Taxes on products

Taxes payable per unit of some good or service. The tax may be a specific amount of money per unit of quantity of a good or service (quantity being measured either in terms of discrete units or continuous physical variables such as volume, weight, strength, distance, time, etc.), or it may be calculated ad valorem as a specified percentage of the price per unit or value of the goods or services transacted. A tax on a product usually becomes payable when the product is produced, sold or imported, but it may also become payable in other circumstances, such as when a good is exported, leased, transferred, delivered, or used for own consumption or own capital formation.

Total expenses

The sum of all expense components.

Total income

Comprises sales and service income, interest income, funding from government for operational costs and other income (for details, see the entries for these items).

Trade margin

Trade margin is the difference between the actual or imputed price realised on a good purchased for resale and the price that would have to be paid by the distributor to replace the good at the time it is sold or otherwise disposed of.


A transaction is an economic flow that is an interaction between institutional units by mutual agreement or an action within an institutional unit that it is analytically useful to treat like a transaction, often because the unit is operating in two different capacities.


A transfer is a transaction in which one institutional unit provides a good, service or asset to another unit without receiving from the latter any good, service or asset in return as a direct counterpart.

Use table

A use table at purchasers’ prices consists of a set of product balances covering all products available in an economy arranged in the form of a rectangular matrix with the products, valued at purchasers’ prices, appearing in the rows and the columns indicating the disposition of the products to various types of uses.

Wages and salaries

The gross wages and salaries (including capitalised wages and salaries) of all employees of the business. The item includes severance, termination and redundancy payments, salaries and fees of directors and executives, retainers and commissions of persons who received a retainer, bonuses, and annual and other types of leave. Provision expenses for employee entitlements (e.g. provisions for annual leave and leave bonus, long service leave, sick leave, and severance, termination and redundancy payments) are also included, as are salary sacrificed earnings and remuneration of employees in the form of share based payments and stock options.

Payments related to self-employed persons such as consultants, contractors and persons paid solely by commission without a retainer are excluded. The drawings of working proprietors and partners are also excluded.


(a) any substance that is discarded, emitted or deposited in the environment in such volume, constituency or manner as to cause an alteration in the environment
(b) any discarded, rejected, unwanted, surplus or abandoned substance
(c) any otherwise discarded, rejected, unwanted, surplus or abandoned substance intended for sale or for recycling, reprocessing, recovery, or purification by a separate operation from that which produced the substance.

Waste Management Services Industry

Can include any combination of collection, transport, recycling, treatment, processing, disposal, managing and monitoring of waste materials (ANZSIC Division D, subdivision 29).

Waste water services

This covers the sewerage and drainage services (ANZSIC division D subdivision 28).

This class consists of units mainly engaged in operating sewerage or drainage systems or sewage treatment plants.

Primary activities
  • Sewage pumping station operation
  • Sewage treatment plant operation
  • Sewerage system operation
  • Stormwater drainage system operation
  • Town drainage system operation.