News 22 Jun 2022
Methodological change in statistics on general government debt
Starting from the releases of June 2022, Statistics Finland will revise the method by which interest subsidy loans of rental dwellings and right of occupancy houses are treated in the national and financial accounts. The latest national accounts data are released today on 22 June 2022 and the latest financial accounts data on 28 June 2022. The methodological change affects general government consolidated EDP debt.
In financial accounts, ARA interest subsidy loans will in future be presented in general government financial assets and liabilities. The methodological change concerns interest subsidy loans granted to rental dwellings and right of occupancy houses, which are approved by the Housing Finance and Development Centre of Finland (ARA). The basis for the methodological change is the conditions of ARA interest subsidy loans that restrict the renting of dwellings and the management of right of occupancy houses for a fixed period. Due to these conditions, the loans of rental dwellings and right of occupancy houses should be presented in the statistical description of general government.
The methodological change affects general government consolidated EDP debt and increases the debt ratio of general government, i.e. the GDP share of the debt. The time series of financial assets and liabilities are revised in financial accounts until the year 2000. Statistics Finland will publish a revision release on Tuesday 28 June 2022 in connection with the financial accounts release and describe the debt effect of the methodological change.
In the sector accounts of national accounts, interests on loans increase the property income and expenditure of general government. The time series of property income and expenditure has been corrected until 2018.
Manual on the European System of Accounts provides guidelines for general government statistics
Guidelines for the statistical description of general government are based on the manual on the European System of Accounts (ESA 2010), and it is an EU Regulation binding to the Member States. In addition, ESA 2010 is specified in the Manual on Government Deficit and Debt (2019), which gives more detailed instructions on the compilation of statistics on general government.
The reporting of the deficit and debt data in the Excessive Deficit Procedure (EDP) includes a regular examination of a Member State’s compilation of statistics on general government in cooperation with Eurostat, the Statistical Office of the European Union. Statistics on Finland's compilation of general government statistics were last examined in a dialogue visit between Statistics Finland and Eurostat in 2021. One of the issues discussed was the interest subsidy loan system of rental dwellings and right of occupancy houses. Statistics Finland was asked to ascertain whether the present statistical method and the interpretation of ESA 2010 fully describe the effect of general government in the public housing production system and whether there are preconditions for changing the delimitation of general government.
Statistics Finland and Eurostat jointly concluded that Statistics Finland would change the statistical methodology for ARA interest subsidy loans and extend for them the statistical description of general government in the sector accounts of national accounts and financial accounts. Statistics Finland implements the change by rerouting ARA interest subsidy loans through general government accounts. The methodological change does not affect general government’s net lending or deficit.
Further information: Teemu Koskiniemi +358 29 551 3467, rahoitus.tilinpito@stat.fi