Transcript Accounting for military activities in peace

A. Braakmann, Th. Forster:
Experiences in Europe in Updating the SNA: The
Government Sector
Swiss Federal Statistical Office
Philippe Stauffer
29th IARIW Conference
Session 7 A SNA (2)
08.07.2015
4 issues are investigated
1. Government owned assets and capital services
2. Accrual accounting of taxes
3. Public-private partnerships
4. Granting and activation of guarantees
08.07.2015
1. Government owned assets and
Capital services
AEG recommendation Introduce a return on capital used for nonmarket production.
Impact
- Higher value-added, operating surplus,
disposable income, consumption expenditure
of GVT.
- No impact on Net lending/borrowing of GVT.
Implementation issues 1. Appropriate data on capital stock of nonmarket producers.
2. Appropriate rate of return.
Outcomes
08.07.2015
- 19 European countries cannot compile
appropriate rate of return due to lack of data.
- Lack of harmonised price indices.
2. Accrual accounting of taxes
 Various procedures to calculate tax revenues on accrual
basis:
1. Model estimations
2. Shifting data
3. Cash data = accrual data.
 Choice of method linked to characteristics of tax.
 Results basically sound.
08.07.2015
3. Public-private partnerships (PPPs)
• Central question: allocation of PPPs.
• Allocation may be based on risk distribution between the
public and private partners.
• Eurostat identified three categories of risk.
• Implementation problems:
1. Complexity of contracts
2. No obligation to report
3. Marked lack of information at local level
4. Enormous work-load
08.07.2015
Issue should
not be
presented in
extensive way
in updated SNA
4. Granting and activation
of guarantees
Current treatment
Proposal
- Granting not recorded.
- Call of guarantee
accounts
- If amount cancelled
Financial
Capital transfer
- Liability when guarantee is granted.
- Recommended use of insurance model.
Implementation issues - Proxies have to be used.
- Absolutely no information on some items.
- Tricky treatment when central government is
reimbursed for past guarantees.
Proposal
08.07.2015
Use a simpler approach.
Questions to the authors
(A. Braakmann, Th. Forster):
1. Impact of real rate of return for capital services : Is government a special case, or are these problems also valid for
the economy as a whole ?
2. Magnitude of change (+/-0,5%): the changes to GDP growth
over time are mainly due to changes in the real rate of
return. What about the annual profile ?
3. PPP’s: Why not adopt a convention ?
3. Granting/activation of guarantees: Doesn’t government
provide any service at all ? What is the true nature of the
08.07.2015 asset of general government (“claim against the importer”)?