Reproductions of this material, or any parts of it, should refer to the IMF Statistics Department as the source.
Government Finance DivisionIMF Statistics Department
9th Meeting of the Advisory Expert Group on National Accounts
September 8–10, 2014, Washington D.C.
Claudia Dziobek, Chief - IMF Government Finance Division
Tuesday, September 9, 2014 (Afternoon Session-Item 14)
The Use of Indicators on Deficit and Debt
Government Finance DivisionIMF Statistics Department
Overview GFS and National Accounts Availability of International Guidelines for Debt Data
Compilation Sources of Differences in Debt Data A Cascading Approach to Presenting Debt Data Way Forward
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Government Finance DivisionIMF Statistics Department
GFS and National Accounts
GFSM 2014 aligned with 2008 SNA Government a major sector GFSM 2014 framework requires additional information
to NA data for more detailed fiscal analysis e.g.,• Different aggregates (revenue, expense, expenditure)• Detailed breakdown of taxes, subsidies, other government
revenue• Consolidation
IMF GFS questionnaire seeks more detailed information than that available from NA compilation.
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Government Finance DivisionIMF Statistics Department
GFS and National Accounts
GFSM Framework has four alternative measures of the deficit / surplus:• Net/gross operating balance• Net lending/net borrowing (NLB)• Cash surplus/deficit• Total financing
Other surplus / deficit indicators are also widely used e.g.• Primary balance (or primary surplus / deficit)• Structural / cyclical balances
All these indicators provide an indication of the in-year fiscal position.
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Government Finance DivisionIMF Statistics Department
GFS and National Accounts
Government gross debt a key fiscal indicator:• Defined as a subset of total government liabilities – six debt
instruments Debt securities Loans Currency and deposits SDRs Other accounts payable Insurance, pension and standardized guarantee schemes
For debt statistics, analytical need for debt at different valuations (not just market values)
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Government Finance DivisionIMF Statistics Department
Availability of International Guidelines for Debt Data Compilation
International guidelines for compiling debt well established:• Government Finance Statistics Manual 2014;• Public Sector Debt Statistics: Guide for Compilers and Users;
and• External Debt Statistics: Guide for Compilers and Users
(EDSG), 2011.
In practice, differences in debt data limit cross country comparability
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Government Finance DivisionIMF Statistics Department
Sources of Differences in Debt Data
Differences arising from:
• Institutional sector coverage – central government? general government? public sector? other?
• Debt instrument coverage – just debt securities and loans, or wider coverage of debt instruments?
• Valuation – market, nominal, or face value
• Consolidation - consolidated or unconsolidated debt?
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Government Finance DivisionIMF Statistics Department
Sources of Differences in Debt DataInstitutional Sector Coverage
Public SectorGeneral Government
Central Government
Public Nonfinancial Corporation Public Financial Corporation
0102030405060708090
100110120130140150160170180
quarter
Gross Debt in Canada by Sector
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Includes State and Local
139%
106%
49%
Source=World Bank/IMF /OECD Quarterly Public Sector Debt Statistics Database
Canada’s Gross Debt by Sector (in percent of GDP)
Government Finance DivisionIMF Statistics Department
Sources of Differences in Debt DataDebt Instrument Coverage
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Note magnitude of Pension Liabilities
Source = Government Finance Statistics Yearbook (GFSY)
Australia: Debt Instruments (in percent of GDP)
Government Finance DivisionIMF Statistics Department
Cascading Approach to Presenting Government Debt Data
Levels of Government
GL1 – Budgetary Central Government
GL2 – GL1 plus extrabudgetary units and social security funds
GL3 – GL2 plus state and local governments
GL4 – GL3 plus nonfinancial public corporations
GL5 – GL4 plus financial public corporations
Aggregations of Debt Instruments
D1 – debt securities and loans
D2 – D1 plus SDRs and currency and deposits
D3 – D2 plus other accounts payable
D4 – D3 plus insurance, pensions and standardized guarantee schemes
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Government Finance DivisionIMF Statistics Department
Cascading Approach to Presenting Government Debt Data
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Financial public corporations
Nonfinancial public corporations
Local governments
State governments
Social security funds GL3
Extra-budgetary units GL2
Budgetary central government GL1
Addition of debt instruments* Special Drawing Rights
** Insurance, pensions and standardized guarantee schemes
GL5GL4
IPSG
S**
D1
D4
D2
D3
Debt
sec.
Loan
s
SDRs
*
Curr
ency
and
dep
.
Acct
s pay
able
Government Finance DivisionIMF Statistics Department
Country Examples: China P.R. Hong Kong
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China PR - HK 2012
GL3 - Consolidated General Government
D1 4.0
D4 41.4
D2 4.0
D3 6.7
Very low levels of debt in D1-D3 – most debt is employment related pensions for civil servants
Government Finance DivisionIMF Statistics Department
Iceland 2012
D1
D2
D3
D4
GL1 - Budgetary Central Government
GL2 - Consolidated Central Government
GL3 - Consolidated General Government
88.7 88.7 97.0
117.5 117.5 131.9
88.7 88.7 97.0
93.8 93.8 105.2
Country Examples: Iceland
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Major increase in Icelandic debt is from D3 to D4 at all levels of government
GL3/D3 = 105 percent of GDPGL3 / D4 = 132 percent of GDP
Government Finance DivisionIMF Statistics Department
D1 79.1 94.2
D4 93.8 122.5
D2 79.6 94.7
D3 81.0 100.7
USA 2012
GL2 - Consolidated Central Government
GL3 - Consolidated General Government
Country Examples: USA
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Some debt securities issuance by State and Local Governments – emphasizes importance of general government data
D1/GL1 is 79 percent of GDP. D4 /GL3 is 122 percent of GDP
Government Finance DivisionIMF Statistics Department
Way Forward
The IMF is adopting the cascading approach in the recently updated questionnaire to collect data from member countries for publication in the 2014 GFSY
• Countries or regions are also allowed to disseminate a debt aggregate using their national definitions of debt
The same approach is adopted for the presentation of government/public sector debt data in the World Bank/IMF/OECD Public Sector Debt Statistics database
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