Review of the COICOP classification Report from the Technical Sub-group COICOP

Background  The Classification of Individual Consumption According to Purpose (COICOP) was developed in the second half of the 1990s and since then the consumer markets have considerably changed.  Some classes have become inadequate or the boundaries between classes less clear.

Background Presentation of results of the Survey to the EG. Launch a TSG Survey to ascertain the need and scope for a possible revision of COICOP First discussion on UN EG on International Statistical Classifications: no revision but launch a survey Presentation of the conclusions of the TSG

Mandate of the technical sub group (1)  Analyse the results of the survey “Questionnaire on issues for a potential revision of the Classification of Individual Consumption According to Purpose (COICOP)” identifying areas of concern.  Identify issues for which “case laws” could solve the problem. Propose “rulings” for these issues.  Analyse the extent of the remaining issues which could not be solved by case laws and, if they are significant, make concrete proposals of change in the present version of the classification. In case of revision a new structure and explanatory notes should be elaborated.

Mandate of the technical sub group (2)  Analyse impact of changes proposed in other related classifications of expenditure according to purpose (COFOG, COPNI, COPP)  Report to the UN Expert Group on classifications of main conclusions.

Way of working  The Technical Sub Group worked exclusively exchanging their opinions by electronic means:  either using  or using the discussion forum setup by UNSD for this purpose.  First task consisted on the analysis of the results of the survey “Questionnaire on issues for a potential revision of the Classification of Individual Consumption According to Purpose (COICOP)”

Way of working  The TSG agreed in subdividing the issues mentioned in the answers to the survey into:  1. Issues which would imply a change in the COICOP structure/level of detail or change in titles,  2. Issues which could be solved by case laws although a change in structure could be a better solution and  3. Issues which could be solved by case laws (a class is clarified or expanded with products not elsewhere mentioned yet)

Way of working  The TSG agreed in subdividing the issues mentioned in the answers to the survey into:  1. Issues which would imply a change in the COICOP structure/level of detail or change in titles,  2. Issues which could be solved by case laws although a change in structure could be a better solution and  3. Issues which could be solved by case laws (a class is clarified or expanded with products not elsewhere mentioned yet) Case laws for each issue were elaborated including the rationale for the decision and also what possible improvements could be foreseen in the case of a revision.

Way of working  The TSG agreed in subdividing the issues mentioned in the answers to the survey into:  1. Issues which would imply a change in the COICOP structure/level of detail or change in titles,  2. Issues which could be solved by case laws although a change in structure could be a better solution and  3. Issues which could be solved by case laws (a class is clarified or expanded with products not elsewhere mentioned yet) There are enough grounds to start a full revision of the COICOP classification.

Recommendation of the TSG Case-laws should be established to make the present classification more usable and data more harmonized The TSG recommends launching a revision process coordinated with all users (National accounts, Price statistics,…)

Scope of the revision  The scope of this revision would need to touch the lower levels of the classification (classes) but also restructuring of the upper levels could be necessary mainly in Divisions 08 and 09 as the boundaries between Communication and Recreation and Culture become more and more blurred.  The introduction of a 5th digit and a better consistency between COICOP and other related classifications like CPC was also seen as useful by several countries.  Depending on the scope of the revision it may be necessary to revise COFOG, COPNI and COPP classifications to keep the consistency between them. The impact on these 3 classifications is difficult to evaluate before concrete proposals of change in COICOP are elaborated.

Next steps  Implement case laws  Set up a TSG for the revision process  Envisage a more targeted consultation during the revision process

Discussion topics  The case laws proposed  The launch of a revision process of the COICOP classification  The timing of the process (in particular the expected completion date)  How to organize the revision process (set up a technical sub-group, need for a world-wide consultation, etc.)  How to organize the transition period as the revision might take some years (case laws/update of explanatory notes )  How to deal with possible consequences to the other purpose classification

Thank you for your attention