Radenci, 8-10 November 2004 STATISTICAL MONITORING OF GLOBALISATION AND SERVICES – A CHALLENGE AND NECESSITY CONFERENCE CONCLUSIONS AND RECOMMENDATIONS The 14th international conference of statisticians, data providers and users of statistical data entitled Statistical Monitoring of Globalisation and Services – A Challenge and Necessity was held from 8 to 10 November 2004 in Radenci, Slovenia. The Conference was attended by 184 participants (25 foreign) from Albania, Australia, Austria, Croatia, Czech Republic, Denmark, Finland, Macedonia, Norway, Romania, Serbia and Montenegro, Slovenia and the United Kingdom as well as from the Bank for International Settlements and the OECD. In addition to the Statistical Office, Slovene participants came from the authorised producers of official statistics (Agency of the Republic of Slovenia for Public and Legal Records and Services, Bank of Slovenia, Ministry of Finance, Institute of Public Health, Health Insurance Institute of Slovenia, and Pension and Disability Insurance Institute), from other government institutions that are closely co-operating with the Statistical Office and are important data users and/or providers, from some enterprises and from the scientific and research sphere. Participants contributed to the exchange of knowledge, ideas and experience. After the introductory section with invited papers, participants worked in three sections: 1. Measurement of economic globalisation 2. Development of service statistics 3. Other development achievements Parallel to sections, five round tables were organised: 1. Record-keeping and statistical monitoring of real estate 2. Co-operation of government institutions in the process of accession to the EMU 3. Role and importance of information and communication technology in modernising the processes of data collection, processing and dissemination 4. Statistical support to regionalisation and cross-border integration of regions 5. Protection and transmission of statistical data for research and analytical purposes Two presentations were organised in the conference hall: 1. SAS: Is insufficient data quality an obstacle for your business? 2. SORS/AJPES: Co-operation of SORS and AJPES in the new method of collecting data on wages In addition, the following presentations were organised in the lobby: SI-STAT Database (SORS), Statistical Terminology (SORS), SAS, Revision of Economic Classifications (SORS) and publications of the Institute for Macroeconomic Analyses and Development. Finally, there were two billboards presenting the 60th anniversary celebration of statistics in Slovenia, which took place on 10 September 2004 in Ljubljana at SORS and in the Grand Union Hall of Grand Hotel Union. Every participant received a copy of the Proceedings Volume, which is also published on the SORS’s web site. There are 54 papers published in the Proceedings Volume, but due to limited time only 52 were presented. Ten interesting papers that arrived too late to be published in the Proceedings Volume were distributed as offprints. 1 The working languages of the Conference were Slovene and English. FINDINGS AND RECOMMENDATIONS Starting points of the Conference The introductory speakers presented their views of globalisation and services, the two main topics of the conference. Globalisation today touches every sphere of life – not only economic – requiring multi-facetted regulation. It was pointed out that globalisation is a reality that cannot be avoided and that it is necessary to use and understand it. Countries have the task to decrease negative effects with timely and proper measures; in order to achieve this, they need proper information, especially on the internationalisation of their economies and complicated relations within multinational companies. International production is gaining importance over trade data. Therefore, there is some urgency to provide data for monitoring international production – both in the activity of affiliates of domestic companies abroad and foreign companies in the domestic economy. Experience and new methodological approaches regarding the measurement of services at the Australian Bureau of Statistics were also presented, especially in the field of satellite accounts (further work on decreasing the frequency of preparing accounts, expanding the contents), globalisation statistics (affiliates), direct measurement of services, which is especially important for non-market services such as health care, education and judiciary (expansion to other services) and producer prices of transport, telecommunications, financial services and software, which are being gradually expanded to other services. This was followed by an interesting presentation of the new approach in the United Kingdom towards measuring the productivity of public services, especially government services in the field of health, education, public order and safety and social protection. The presented method of measurement could set a good example and be a challenge for measuring public services in Slovenia. In addition, challenges of the European Statistical System were presented: how to provide greater productivity of the system compared to the American system. The latter, namely, continues to provide some key indicators, important for making policy decisions in various areas, much more rapidly. A possible solution to this problem would be the application of European samples. With ever greater development work on methodological, technological and educational solutions, it is necessary for this area to exploit actual division of tasks between national statistical offices. Revision of statistical legislation is necessary, especially in terms of its simplification; one outcome could be to provide only those data that are absolutely necessary. The introductory part of the Conference ended with a very interesting lecture entitled ”Statistics Do Not Lie – People Do?” in which some examples of misleading charts and misinterpretation of data were presented. The lecturer concluded with the statement that statistics cannot lie but that people can and quite often do. 1. Measurement of economic globalisation 1.1 Globalisation is a very complex phenomenon, which reflects in the substantial difficulties regarding its measurement and statistical monitoring. Globalisation brings not only quantitative changes in the extent of international transactions but also changes in the quality of interactions between various economic players. Because individual indicators for measuring globalisation do not provide insight into the total extent, dynamics and the 2 complexity of links between players, a systematic approach to measuring globalisation is needed. 1.2 The use of enterprise data that concern various aspects of their international business for estimating and analysing globalisation trends is complementary to data at the macroeconomic level; however, their use also brings certain risks. Frequent changes in accounting standards and additional demands posed by multinational companies to their affiliates as regards reporting prevent national comparisons in terms of time and contents. At the same time they also make international comparison more difficult. This shows that multinational companies as the main players of globalisation are ahead of national institutions. The existing methods of monitoring foreign direct investment and activities of multinational companies are not enough for the analysis of determinants and results of FDI and operation of multinational companies. 1.3 Especially important for each individual country are the effects of globalisation on the national economy and comparability of these effects among countries. Therefore, methodological comparability of measuring globalisation is the main purpose of co-operation of countries in preparing international indicators for monitoring globalisation within international organisations. The OECD is thus preparing the Handbook on Economic Globalisation Indicators, which is scheduled to be published by the end of 2004 and which should set standards for monitoring economic activities of international companies. Statistical offices of individual countries are introducing, on a trial basis, the monitoring of economic operations of activities of international companies (FATS statistics). Due to data availability, this is easier for the activities of foreign companies in Slovenia than for the activities of Slovene companies abroad. 1.4 The traditional treatment of services within the balance of payments accounts does not sufficiently identify actual trends and the economic importance of services in international trade. Therefore, more appropriate coverage of services in international trade in light of globalisation and modern business practise has to be introduced. 1.5 Among other things, globalisation is apparent in the changed structure of trade activity, which is the result of foreign traders entering the domestic market and domestic companies expanding abroad. 2. Development of service statistics 2.1 Statistical monitoring of services – irrespective of the specific aspect of treatment, e.g. for calculating price indices, for monitoring the volume of an activity, etc. – demands different, innovative approaches in collecting data and developing methodologies, which take into account the specific nature of services in view of their complexity, problems with identifying the unit of service, producers, reporting units, etc. That setting up service statistics is a very demanding development task is confirmed by the fact that research in this area has intensified in recent years and that most countries are only beginning to establish methodological standards. Because of its complexity, it is advisable to design the strategy of developing service statistics on the principles of co-operation and linking at various levels (national and international), in various institutional frameworks (statistics, data providers, university) and integrally by taking into account developments in other fields of statistics (e.g. classifications). In the papers presented, conclusions draw attention to the development of service statistics, which is far from being a closed professional subject and should be included in a systematic way in the agenda of forthcoming statistical conferences. 3 2.2 In 2002, European statistics set up a strategy of monitoring services in two directions. One concerns the regulation of economic classifications and the business register, so that it will be possible to cover all types of new activities. To this end, the process of revising international classifications of economic activities and products started, which is known as Operation 2007. 2.3 The issue of developing service statistics was discussed from the point of view of calculating producer price indices for services, the calculation of which will be necessary after the adoption of the amended Commission regulation on short-term statistics. The positions for developing the methodology for calculating this index were presented as well as the results and practical guidelines for calculating indices of some services (passenger air transport and advertising services in Austria). 2.4 With reference to price indices, the methodological bases and data possibilities for calculating the aggregate asset price index were presented, which has, for the past several years, been calculated by the Bank for International Settlements for about 20 countries. The calculation of the real estate price index presents a great challenge for Slovene statistics, which has to be tackled as soon as possible. 2.5 A very complex overview of individual services is provided by satellite accounts. Slovenia joined the development of tourism satellite accounts according to the methodology of the World Tourism Organisation and Eurostat. Tourism is a phenomenon driven by demand, so that as complete a coverage and monitoring of tourist consumption as possible is seen to be the main target of tourism satellite accounts. 2.6 The demand for health services is on the rise, while, concurrently, the number of the active population that contributes financial resources for health care is on the decline. These problems dictate adjustment and reform of health systems to the new situation. Health policy and analysts need proper statistics, especially internationally comparable data on financing and expenditure for health care. It is therefore of some urgency to introduce national health accounts in Slovenia. Experts preparing these accounts expect to encounter numerous problems in collecting the data, in linking data from various administrative databases and in areas where no data exist. 2.7 Within the current Community Action Programme on Public Health for 2003-2008, a very important area is health information and knowledge strand. The main objective of this part of the Programme is the development of proper information on health and the availability of information on programme implementation and results. The priorities are the development of public health indicators, data collection and methods of dissemination, and the use of health information. The Programme is organised through a consultancy network of competent institutions and experts in various countries. 2.8 Short-term statistics of services at the level of the European Union is governed by the Council Regulation (EC) No 1165/98, Annexes C and D, and Amended Regulation. The legislation lays down the methodology, timeliness, form and contents of data that the countries have to send to the European statistical office, where the process of data aggregation and the calculation of the European aggregate is carried out. Slovene statistics already follow the guidelines of this regulation for trade, hotels and restaurants and various other services. Work will continue with the inclusion of outstanding services and quality improvement. 2.9 Better understanding of the service sector is one of the key issues in modern economies. Within structural business statistics, SORS is co-operating with some other EU Member States in pilot projects on business services and the demand for services. 4 3. Other development achievements As always, numerous new developments in various fields of statistics were presented at the Conference, which were divided into four groups: social statistics, business statistics, environment and agriculture, and national accounts. 3.1 o o o o o o o 3.2 o o o o o Social statistics: Calculation of labour costs and its automation, which anticipates calculation of the labour cost index harmonised with the EU and comparable among countries. Work as a welfare component and its measurement from the point of view of employment, including the grey economy, and forced, night, child and voluntary labour. Social Statistics Database, which will enable a number of surveys to be conducted and will be the basis for the transition to register-based population censuses. Analysis of the comparison of the number of population according to the 2002 population census and the Central Population Register at the level of municipalities. Worries were pointed out regarding dissemination of data at the municipal level. Changes in the field of population coverage with stationary and mobile telephony require changes in the survey methodology and linking with the Central Population Register. The paper describing the situation in the field of lifelong learning showed an unfavourable situation that only few people over 45 study. The two main reasons for not participating in education are lack of interest and lack of time. We have also touched on the issue of cultural statistics. Culture is a basic value of exclusively national responsibility. A great need for distinguishing between records and statistical data for monitoring this area was pointed out. Business statistics: The pilot project on business demography, where we are monitoring the birth, survival and death of enterprises, taking into account various changes during their operation. Business demography is a relatively new area in EU Member States. Slovene statistical office has co-operated in these efforts since the beginning. Introduction of Intrastat – measuring the trade in goods in the conditions of full membership of the EU, which changed the organisation of data collection and dissemination in all phases of the process after 1 May 2004. We did not experience major difficulties caused by the introduction of Intrastat due to careful preparation to deal with these changes. The response of reporting units is very good. Enterprises prepared well for the new way of reporting, which shows in the fact that 94% of the value of trade in goods is reported using e-reporting and the web form and only 6% using paper forms. An example of reporting adjustment was presented by the spinning-mill enterprise Predilnica Litija. Electronic services of public administration: whereas the supply of e-services is satisfactory, one cannot say the same for the demand side, which is limited by lack of motivation, access problems or insufficient knowledge. It was pointed out that for correct evaluation of the situation in this area the methodology should be improved. There is high demand on statistics on information and communication technology in enterprises. A case study of in-depth interviews of 51 enterprises conducted in Finland has shown that impacts of ICT are not easy to measure in general ICT surveys. The conclusions also indicate that much of the richness of e-business is not dealt with in the surveys and that more intensity indicators would be needed. This year SORS conducted for the first time an internationally comparable survey on IT usage in enterprises and households, largely dealing with indicators of IT availability. The Statistical Office is aware of the great burden of reporting units, both enterprises and households. The results of the analysis show that for enterprises, in addition to 5 o 3.3 o o o o o mail questionnaires, other forms of surveying should be introduced – telephone interviewing and also, if necessary, personal interviewing. As regards the development of enterprise surveys, we should consider the modernisation of questionnaires in terms of design and the introduction of combined questionnaires of SORS and other institutions, such as the example of the new collection of data on wages (SORS and AJPES). It was pointed out that the study of the burden of reporting units should include marketing businesses and public administration, which also collect some data. Environment and agriculture: The VAT flat-rate compensation that farmers can receive, amounting to 4% of the purchase value, only rarely covers the VAT that they had paid on their purchases. For Slovenia, negative- or under-compensation is characteristic. The calculation of undercompensation for 2001 was presented. The Statistical Register of Agricultural Holdings was set up after the 2000 Agricultural Census in the Republic of Slovenia. In this way an updated sampling frame for statistical surveys in the field of agriculture was provided. In addition to definitions and content, a topic of special interest is data updating. Future development will focus on linking statistical and administrative data sources. Water is a vital resource and represents one of the ecosystem inputs. It is a natural source for economic activities; therefore, it can be understood as a product and as a waste. The integration of economic and environmental data into water satellite accounts makes it possible to present the interplay between the economy and the environment and can help assess the availability of water in terms of quantity and quality. First calculations of water accounts were presented. Environmental data and indicators should be as publicly available as possible, so the Environmental Agency of the Republic of Slovenia is preparing a new information system (information pyramid) within the European environment information and observation network (EIONET). In addition to papers discussing the agriculture and the environment, the pilot survey on user satisfaction was presented, with which SORS is trying to measure users’ satisfaction with statistical products and services as well as to establish what their habits are. As SORS’s vision is orientation towards users, it hopes to use the results of this survey in improving the products and services intended for various user groups. 3.4 National accounts: The first group of papers described the experiences and results in the Western Balkan countries and the second in Slovenia. o The first paper presented the calculation of purchasing power parities to include Western Balkan countries in international comparison of real GDP (European Comparison Programme). The comparison is organised by the OECD and SORS. The case of calculating the relation of consumer price levels between the republics of Serbia and Montenegro was presented. o Data sources for the export of travel services and their use for GDP calculation in the Republic of Croatia were presented as well as the case of data exchange between various countries that are most important for tourism in Croatia. This confirms the fact that methodological co-operation and data exchange between countries is necessary in order to achieve greater data quality. o The major 1995-2002 GDP revision implemented by SORS in 2004 was presented. With this revision, Slovenia achieved final methodological adjustment with ESA 95. o Full coverage of GDP requires measurement of non-observed activities, which can be implemented in various ways. Initial data for 2002 show that passenger transport activities, prostitution and illegal software are major elements. The estimation of nonobserved activities is still experimental and is not part of the official GDP calculation. 6 o 4. Estimation of national accounts aggregates at the previous year’s prices serves for the calculation of GDP growth. The EU has endorsed the new methodology and stipulated that it is to be implemented from 2005 on. SORS is working on the new method of estimation and has already prepared first estimates. It will start with new annual accounts estimates in September 2005 (initial estimate for 2004), whereas the inclusion into quarterly accounts will take more time. ROUND TABLES 4.1 Record-keeping and statistical monitoring of real estate The discussion contributed many detailed specific proposals and the following main points: 1) The path to monitoring real estate statistics is through standard cross-sectional time recording, which should be linked via standard identifiers and indicators for monitoring the implementation of strategies on the basis of these series. 2) For the time being the linking of real estate records will be implemented in the distribution areas of the Ministry of the Environment and Spatial Planning and the Surveying and Mapping Authority of the Republic of Slovenia. Individual data on real estate will be publicly available (payment of costs), except for data on ownership. The driving force behind linking and developing these records in Slovenia is the expected real estate taxation; however, this is necessary for a number of other economic and social reasons. The system of data updating will have to be improved. Linking of real estate records to other data as well as their analytical upgrading will probably have to be organised in a form that will enable at least partial reimbursement of costs. 3) The need for the statistical function of the land register and the linking of the land register to other records was pointed out. 4) The area and priorities of real estate statistics will be determined in the development task as part of the programme of statistical surveys and in co-operation with the working group of the Advisory Committee for Real Estate Statistics. 5) One of the ways to link the national programme of statistical surveys with sectoral statistics, which are especially important in the area of real estate, is to set up common web pages of various sectors and the Statistical Office. 4.2 Co-operation of government institutions in the process of accession to the EMU Agreement as a good basis for realising very complex and numerous requests of the EU and the EMU from the field of economic and financial statistics, with relatively few human resources in Slovenia, determines the understanding and division of tasks as well as common working groups and co-operation; as such, SORS is responsible for providing data in accordance with ESA 95 methodology. 1. New challenges: a. Realisation of all EMU requests (e.g. Bank of Slovenia implementation of three ECB regulations 2001/13, 2001/18, 2002/7). b. The use of common sectorisation of economic subjects according to ESA 95 (Agency of the Republic of Slovenia for Public and Legal Records and Services) and synchronisation in practice. c. Public finance statistics – GFS, EDP procedure; transition to accrual principle for the series of data from 1995 to 1998. Advice from European institutions would be appreciated in the transition to the accrual principle (transition tables). d. Improvement of new requirements from the field of general economic statistics (e.g. real estate market). e. All parties to the agreement must strive for the implementation and operative upgrading of the agreement (e.g. synchronisation of publishing key statistics). f. To provide appropriate knowledge and harmonised transition to the international accounting standards. 7 g. h. i. Urgent investment in human resources in all institutions that signed the agreement in the field of economic and financial statistics to achieve a quality level and active development role in European integrations. To continue regular active exchange of information and opinion in the direction of upgrading and operability of the agreement. The priority task is to exchange and provide transparent exchange of methodologies: Bank of Slovenia – financial accounts, SORS – non-financial accounts. 4.3 Role and importance of information and communication technology (ICT) in modernising the processes of data collection, processing and dissemination 1. Monitoring the progress in the area of statistical methodology and information technology has to be permanent. An example of such a program is the Australian Business Statistics Innovation Program, within which the re-engineering of statistical processes in the area of business statistics is implemented. Among 60 projects taking place within this program, the key one is the project of setting up an input data warehouse, which will enable multiple use of collected statistical data, increase the use of administrative data and decrease the burden of reporting units, improve the consistency of collected data and increase the efficiency of the entire statistical process. 2. The European framework for Interchange of Data between Administrations (IDA) offers recommendations for setting up this framework at the national level. The introduction of the concept of the unique entry window, which is the basis for B2G communication, is recommended. The register basis of the public administration system and the technology enable us to implement the solutions; however, the legal framework has to be prepared within the Linking of Public Records Act, the draft of which has been proposed by the Statistical Office some time ago. 3. Challenges such as the possibility to analyse the data in all phases of the process, the use of “third-party” statistical and analytical tools in the whole process, the possibility to combine data from primary and secondary sources, the use of new automated methods of data editing and the increase of the efficiency demand transition from traditional stovepipe processes into integrated solutions where great emphasis is put on metadata. The introduction of metadata-driven and integrated solutions makes sense wherever possible, but they should be built gradually through a larger number of small projects that can yield results in a relatively short time and are guided to the immediate use of solutions in production. The introduction of commercial and statistical tools into the process decreases the level of metadatadriven solutions; however, modern solutions in the area of interoperability enable automated processes. In spite of the complexity brought about by the integrated information systems, the development knowledge within the organisation should be kept and outsourcing should be used in the light of advancing the internal knowledge and accelerating the development. 4.4. Statistical support to the regionalisation and cross-border integration of regions Information was given on negotiations for the territorial breakdown of Slovenia at NUTS 2 level. During the accession negotiations, Slovenia and the European Union have namely agreed that negotiations on the territorial breakdown at NUTS 2 level would continue after accession. Accordingly, in September 2004 Slovenia proposed to the European Commission three statistical, non-administrative, territorial units at NUTS 2 level: Eastern, Central and Western Slovenia. The reasons for the proposal are geographic, historic and socio-economic and that such a breakdown would most efficiently tackle the problems of 8 the existing regional differences. At present, the European Commission is against such a proposal as it does not meet the criteria for the minimum number of population (800,000) for a NUTS 2 unit in EU Member States as stipulated by the Regulation No. 1059/2003. The Statistical Office of Slovenia is offering professional assistance to the negotiating team and will be responsible for providing statistical data for new territorial units. The topical subject of NUTS in the Czech Republic was presented. The Czech Republic has similar problems with the division of the country into two territorial units at NUTS 1 level as does Slovenia. The Czech Statistical Office is setting up the database of regional data called CBFD (Cross-Border Friend Database) for the Euroregion NEISSE, which covers border regions in the Czech Republic, Saxony and Poland. One consequence of setting up such a database has been the “excellent informal cross-border partnership between statisticians and users”. Some initiatives regarding Euroregions – including the territory of the Republic of Slovenia – were also presented, namely the Alps-Adriatic Working Community, Euroregion of the Future, Istra Euroregion and MacroEuroregion. There are many objectives of such cooperation and they justify the efforts invested by politicians, businesses and statisticians. The latter are faced with the challenge of numerous indicators for various areas that should in the future be statistically processed. In addition, regional initiatives in the wider area of South-eastern Europe were also presented. The discussion focused on costs connected with new territorial breakdowns at various NUTS levels. It was pointed our that the frequency of statistical data demanded by Eurostat is increasing, so the cost of providing such data will also increase. It is therefore necessary to use, to the greatest possible extent, the linking of various administrative registers, which could solve the burning issue of confidentiality of statistical data at a regional level. In co-operation with statistical offices in neighbouring countries, SORS intends to set up a regional database with data on border regions. To this end a working group is being formed that will study the content of regional data and the method of disseminating them. Information was given on the preparation of an additional protocol to the framework convention on cross-border co-operation of territorial communities or authorities within the Council of Europe and a similar initiative of the European Commission, which hopes to expand the possible forms of cross-border co-operation of regions. 4.5. Protection and transmission of statistical data for research and analytical purposes The main topic of discussion was the setting up of the system of researchers’ remote (online) access to de-individualised microdata. The starting point of the discussion was the presentation of the system introduced by Statistics Denmark, which was the first of its kind. The discussants expressed their opinion that the large quantity of administrative data available in Slovenia supplemented by the data collected with statistical surveys on the one hand, and the growing needs of society for information on the other, are the real bases to enable researchers and government institutions to conduct the efficient implementation of additional data analyses, while guaranteeing statistical confidentiality for individuals and businesses. The participants agreed that the Danish model offers distinct advantages over the other known systems of transmitting microdata for research purposes. In the Danish system, microdata never leave the servers of the statistical office, which is advantageous from the point of view of data protection; researchers can analyse data from their workplaces, which presents an advantage for them and simplifies the statistical office’s task; the organisation of the preparation, maintenance and financing of the system involves the co-operation of the 9 Danish ministry of science; and the system enables constant surveillance of statistical confidentiality of tabulated data. The participants are convinced that the Danish model of transmitting microdata would supplement the set of information that is the basis for preparing and evaluating national policies in various areas of social life and the economy in Slovenia. SORS and the Ministry of Education, Science and Sport will soon start to implement activities necessary for setting up the system in Slovenia. TOPIC OF THE 15th STATISTICAL DAYS 2005 During topic: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. the conference we received a number of proposals regarding next year’s conference Agriculture – monitoring of prices and trends in agricultural output Regional and structural policy Information access Changes of the EU statistics act and implementation of the code of practice in national statistical systems Providing data for researchers Social statistics – EU-SILC, HBS, LFS Migration statistics Gender statistics Data information, dissemination and transparency Competitiveness – today's challenges in measurement Challenges and solutions in communication with users (SORS’s proposal) Since SORS’s proposal encompasses four other proposals (under 3, 4, 5 and 9), SORS’s Director-General proposed the topic “Challenges and Solutions in Communication with Users”, which was adopted by common agreement. The topic of the 15th Statistical Days, which will take place in November 2005 in Radenci, will thus be: “CHALLENGES AND SOLUTIONS IN COMMUNICATION WITH USERS”. Within this topic it will be possible to discuss new challenges in data transmission, exchange, protection, transparency, quality and access, collecting the needs of users, training of users, etc. 10