SUTs – data sources and bridge tables THE CONTRACTOR IS ACTING UNDER A FRAMEWORK CONTRACT CONCLUDED WITH THE COMMISSION

Compiling the supply tables The Make matrix (M) Shows the production of products by industry Products – CPA Industries – NACE Rev 2 Output at basic prices

Compiling the supply tables How many industries? How many products? What factors affect the choice?

Make matrix (production table) Make matrix shows the production of products (rows) by industries (columns) It shows main products by industry in diagonal It shows secondary production in off-diagonal cells

Make matrix – secondary production Large secondary production entries are Manufacturing producing construction, and wholesaling, retailing and business services Construction produces manufacturing Wholesaling and retailing produce each other Business services do some retailing

Make matrix If detailed product information is available for international trade, industrial output and purchases, then the supply system should make use of this information through showing more products than industries This will enable more secure allocation of supply to intermediate and final demand categories when reconciling production and expenditure

Make matrix In Europe, there is annual survey (PRODCOM) of industry producing goods to show production of product headings according to CPA This survey allows a rectangular table of production by industry (NACE Rev 2) and products (CPA 2008). Total production is extended and grossed up to be consistent with annual business inquiry

Supply table data sources Each step in moving from basic prices to purchasers’ prices is set out in Table 4.13 of the Eurostat manual on supply, use and I-O framework For output, Output at basic prices + taxes on products + non-deductable VAT, gives producers prices (net of deductable VAT) and then +non-deductable VAT + trade margins + separately invoiced transport charges gives output at purchasers price

The tax nomenclature for the EU D. 2 Taxes on production and imports D The tax nomenclature for the EU D.2 Taxes on production and imports D.21 Taxes on products D.211 VAT D.212 Taxes on imports D.214 Taxes on products (not VAT or tax on imports) D.29 Other taxes on production

Imports Imports of goods are valued at cif in the international trade figures Adjustments are needed to ensure that domestic insurance and freight services supplied outside the border of the exporting country, are excluded from the import values to prevent double counting of supply

Distribution margins These margins apply to wholesaling – transactions between intermediate producers Retailing – transactions between producers and final expenditure

Margins Data source – Surveys into the wholesaling and retailing industries, identifying goods for resale and goods sold separately from other purchases These surveys should give detail on products handled so that margins (value of goods for sold less value of goods for resale) can be established by product

Margins More information on retailing margin by type of outlet can be obtained from non-government sources – analysis companies, large business reports, etc. Where no new information is available, use historic estimate sof margins and chek sum with output of retailing industry

Taxes A comprehensive account of taxes raised by government from business production is usually available from business surveys, as a publication, or detail direct from the government tax office The information should allow an allocation of production taxes and product taxes by kind of business, and VAT by products if the records include detailed business type

The use table – industry purchases The information on business purchases for a year will come from an annual business survey, extended by more detail on the product composition of inputs. This extended survey may only occur at 5 or 10 year intervals, given the extra resource demands on both NSOs and business Output and value added measures and some key inputs are collected annually.

Purchases by Households Data on household spending can come from Household Budget Surveys Detailed Retailing Surveys The classification for household spending is “Classification of Individual Consumption by Purpose” (COICOP)

Bridge table For a year when most information is available on household spending by purpose though an HBS or extended retail sales inquiry A bridge table can be constructed This table will allow product input structures to be estimated for non benchmark years, using the structure of teh benchmark year spending

Purchases by government Data on government spending comes from government departments The classification is “Classification of the Functions of Government” (COFOG) In benchmark years, special exercises on the product make-up of department purpose spending can be carried out, to create bridge tables which will allow non-benchmark year estimates to be derived. Household Budget Surveys Detailed Retailing Surveys The classification for household spending is “Classification of Individual Consumption by Purpose” (COICOP)

Purchases of assets Data on gross fixed capital formation by NACE industry groups will come from Annual Business Surveys, ideally with extended forms to capture product detail of assets acquired. It is also possible to allocated products to capital formation from international trade and domestic production (PRODCOM) through a description of the nature of the products e. brewing tank The classification for household spending is “Classification of Individual Consumption by Purpose” (COICOP)

Exports These are available through Customs measures of international trade (in Europe collected through an extension of the VAT data collection system) A bridge table can be constructed as with imports, to move from a CN basis to a CPA basis Services are available trough the Balance of Payment Services inquiries

Commodity flow estimates Where input structure information is missing, fragmentary or of uncertain quality, allocating products through detailed description to its “likely” user is a good second best E.g. brewing tank – probably capital formation in the beer production business For retailed goods, distribution margins and product taxes must be allowed for if the use is at purchaser prices

Value added There is a confrontation between value added as the difference between output and input (the production approach) and the income estimate from other sources such as tax records There is usually a good correlation between compensation of employees if this is measured through the business survey But operating surplus can be different by large amounts, and reconciliation is case by case

Other data sources Agriculture – Ministry of agriculture Transport data from Department of Transport Other business surveys e.g. New earnings survey Company accounts Business associations