Background Notes

Introduction

This release comprises the latest official release by CSO of annual Government Income and Expenditure (GIE) results for 2014 to 2019. The data in this release reflect the Government Finance Statistcis (GFS) 2020 Q1 release of 17 July 2020. The data published in this series are fully consistent with the National Income and Expenditure 2019 publication of 20 July 2020.

The tables provide detailed revenue and expenditure data for general government and its two subsectors, central and local government.  A full time series of general government data back to 2000 are available on CSO Statbank here. The full suite of GFS tables are available on the CSO website here.

Data back to 1995 for all EU Member States are available on Eurostat’s data base, located here.  

Methodological Changes to data

Methodological review and revision of Compensation of employees (ESA code D.1):

The National Accounts IT (NAIT) project has enabled Government Accounts Compilation and Outputs (GACO) Division to review, develop and streamline its data sources and compilation methods. In parallel with this ongoing work, a new Revenue data source for the compensation of employees, i.e. pay (ESA code = D.1), has become available to the CSO. Pay As You Earn MODernisation (PMOD) is more comprehensive and timely data from the Revenue Commissioners. This "live" monthly data is processed within the NAIT system. The sub-components of D.1 were revised in this methodological review - Imputed Employer Pension Contributions (D.1221); Imputed Employer Non-Pension Contributions (D.1222) for the whole economy and government employee social contributions. This review has culminated in a robust method for the compilation of the components of D.1 for General Government (2011-2019) that is consistent with estimates of D.1 for other sectors of the economy.

Revisions to Government data since EDP

Revisions to General Government Deficit/Surplus (GG Deficit/Surplus) 

Expenditure under the 'Early Childhood Care and Education Programme' (ECCE) was reclassified from P.2 to D.632 from 2011 onwards. Other changes to the D.632 figures reflect updated data for local authority housing payments and free fees payments to universities.

Depreciation (P.51c): Revisions have been made to the P.51c data due to the availability of additional data. These revisions are in line with the latest National Income and Expenditure Accounts published on 20 July 2020. 

Transactions of note during 2019

Super dividend: In 2019 Q2 the Exchequer received a super dividend of €1,653 million from the Central Bank of Ireland.

IBRC payment to Exchequer: In 2013 the payment by the Exchequer of €1.1 billion to meet obligations to IBRC deposit holders under the guarentee schemes in operation was treated as the granting of a loan from the Exchequer to IBRC, on the understanding that the Exchequer would be treated as a creditor of IBRC in the liquidation process and that there was a reasonable expectation of repayment. The 2019 repayment of €681.7 million was made in 2019 Q4.

Consultants pay settlement: In June 2018 there was a settlement made following a court process with medical consultants in relation to pay arrears. The backdated payments of €104 million were recorded as D.99 expenditure of central government in Q3 and Q4 2019.

Net acquisition of unproduced assets (NP): The sale of the former DIT Kevin Street Campus for €140 million in Q3 2019 is included under the NP figure.

GDP and GNI* figures used in publication

The GDP and GNI* figures used in the current publication are consistent with those published in the latest National Income and Expenditure Accounts 2019 on 20 July 2020.

Government Finance Statistics – concepts and definitions

GFS form the basis for fiscal monitoring in Europe, in particular in relation to the Excessive Deficit Procedure (EDP).

European GFS, including EDP statistics, are produced according to the legally binding accounting rules of the European System of Accounts (ESA2010). The Manual on Government Debt and Deficit (MGDD) provides further guidance on the implementation of ESA 2010 in the context of GFS.

EU Member States are required to report government deficit/surplus and debt data biannually under the EDP - before 1 April and 1 October in year N, for years N-4 to N-1 calendar years, as well as a forecast for the current year. The data are reported in harmonised tables, which provide a consistent framework for the presentation of this data by Member States. The tables provide a structure for linking national budgetary aggregates with government deficit and debt.

In addition to the EDP transmission programme, detailed statistics on government revenue and expenditure are also provided to Eurostat under the ESA transmission programme.

These data are available on the Eurostat website here

Definition of general government and its subsectors

The general government sector of the economy, is defined in ESA2010 paragraph 2.111: as “institutional units which are non-market producers whose output is intended for individual and collective consumption, and are financed by compulsory payments made by units belonging to other sectors, and institutional units principally engaged in the redistribution of national income and wealth”. General government comprises the sub-sectors central government (S.1311), state government (S.1312 – which does not apply in Ireland), local government (S.1313), and social security funds (S.1314 – which does not apply in Ireland). The latest Register of Public Bodies can be viewed here.

General government deficit/surplus (GG deficit/surplus) is the standard European measure of the fiscal balance, which is used to monitor compliance with the Stability and Growth Pact.

This measure is by definition equal to both Total revenue (TR) less Total expenditure (TE) (Table 1), and Net acquisition of financial assets less Net incurrence of liabilities. In order to respect this accounting identity, a technical adjustment is made to the level of transactions recorded in liability category F32 (long-term debt securities) to eliminate any statistical discrepancy between the two approaches to the calculation of GG deficit/surplus. This adjustment has no impact on Gross debt, Net debt or Net worth.

Detailed codes and technical definitions can be seen in the ESA 2010 manual here

A listing of some of the main items included in this release is shown below.

Main components of general government expenditure and revenue

P.1 Total output of government is equal to market output, own account capital formation, and non-market output (i.e. the sum of D.1+P.2+P51c). The market output referred to in this publication is the imputed market value of social housing rented dwellings.

P.2 Intermediate consumption – value of goods and services used in the process of production, excluding fixed assets.

P.3 Final consumption expenditure of government is equal to the total of its output (P.1) plus the expenditure on products/services supplied to households via market producers minus the sales of goods and services (at both market and non-market prices). This is made up of individual non-market services plus collective non-market services (P.31 and P.32).

P.5 Gross capital formation.

P.51g Gross fixed capital formation - acquisitions, less disposals, of fixed assets during a given period plus certain additions to the value of non-produced assets realised by productive activity. Fixed assets are tangible or intangible assets produced as outputs from processes of production that are themselves used repeatedly, or continuously, in processes of production for more than one year.

P.51c Consumption of fixed capital - the amount of fixed assets used up, during the period under consideration, as a result of normal wear and tear and foreseeable obsolescence, including a provision for losses of fixed assets as a result of accidental damage which can be insured against.

P.52 Changes in inventories.

P.53 Acquisitions less disposals of valuables.

D.1 Compensation of employees (Pay) - the total remuneration of government employees.

D.21    Taxes on products are taxes that are payable per unit of a given good or service produced or transacted. Included in this is customs and excise taxes and VAT. To accrue this data the cash receipts are time adjusted. Customs and excise taxes are time adjusted by 1 month and VAT is time adjusted by 2 months. For example Q1 VAT is March, April, May cash receipts.

D.29 Other taxes on production (payable) all taxes that enterprises incur as a result of engaging in production, independently of the quantity or value of the goods and services produced or sold. These include taxes on use or ownership of land or buildings, taxes on use of fixed assets, taxes on total wage bill and payroll, taxes on international transactions related to production.

D.3 Subsidies (payable) - current unrequited payments which general government or the institutions of the European Union make to resident producers, with the objective of influencing their levels of production, their prices or the remuneration of the factors of production.

D.4 Property income accrues when the owners of financial assets and natural resources put them at the disposal of other units of the economy. The income payable for the use of financial assets is called investment income, while that payable for the use of a natural resource is called rent. Property income is the sum of investment income and rent.

D.41 Interest receivable by the owners of a financial asset for putting it at the disposal of another institutional unit. Applies to deposits (AF.2), debt securities (AF.3), loans (AF.4) and other accounts payable (AF.8).

D.42 Dividends receivable by the owners of share equities. Dividends exclude "super dividends" which arise where the dividend paid is large relative to the recent level of dividends and earnings. Super dividends are recorded as withdrawal of equity (F.5). This arises, for example, in the case of dividends paid by the Central Bank.

D.45 Rent of a natural resource – income receivable by the owner of a natural resource for putting the resource at the disposal of another party.

D.5 Current taxes on income, wealth, etc., (payable) - all compulsory, unrequited payments, in cash or in kind, levied periodically by general government and by the rest of the world on the income and wealth of units in the economy, and some periodic taxes which are assessed neither on income nor wealth.

D.6 Social contributions - transfers to households, in cash or in kind, intended to relieve them from the financial burden of a number of risks or needs.

D.7 Other current transfers – includes VAT and GNI based EU budget contributions, current transfers between subsectors of government, current international co-operation and current transfers to households and non-profit institutions.

D.9 Capital transfers - involve the acquisition or disposal of an asset, or assets, by at least one of the parties to the transaction. Includes capital taxes and investment grants.

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