Arthur Berger GDP by Final Expenditure, Shenzhen, China, April 2011 Estimation of Government Current Expenditure on Goods and Services in the Canadian SNA

01/11/2015 Statistics Canada Statistique Canada 2 Outline 1.Government sub-sectors in the Canadian SNA 2.Accounts that include Government Current Expenditure (GCE) in the Canadian SNA 3.Revision cycle 4.GCE estimation in nominal terms 5.Deflation of GCE

01/11/2015 Statistics Canada Statistique Canada 3 Government sub-sectors in the Canadian SNA  Federal government  Provincial and territorial government  Local government  Canada Pension Plan (CPP) & Quebec Pension Plan (QPP)

01/11/2015 Statistics Canada Statistique Canada 4 Accounts that include GCE in the Canadian SNA Supply Use Accounts Income & Expenditure Accounts

01/11/2015 Statistics Canada Statistique Canada 5 Revision cycle Annual revisions  Once a year, quarterly IEA are revised going back 3 years to align with the most recent supply-use tables Sub-annual revisions  Between annual revisions, quarterly IEA is revised within the most recent reference year only

01/11/2015 Statistics Canada Statistique Canada 6 Revision cycle: GDP by final expenditure Quarterly IEAannual supply-use Jan-11 Feb-11Q1/ Q4/2010 Mar-11 Apr GDP C$ May-11Q1/ Q1/2011 Jun-11 Jul-11 Aug-11Q1/ Q2/ GDP K$ Sep-11 Oct detail Nov-11Q1/ Q3/2011 Dec-11

01/11/2015 Statistics Canada Statistique Canada 7 Revision cycle: GDP by final expenditure Feb-20111st annual estimate May-20112nd annual estimate3rd annual estimatefinal annual estimate May-20123rd annual estimatefinal annual estimate May-2013final annual estimate

01/11/2015 Statistics Canada Statistique Canada 8 GCE estimation in nominal terms “Current” quarterly estimation Preliminary annual estimation Final annual estimation Federal government Provincial and territorial governments Local governments CPP & QPP

01/11/2015 Statistics Canada Statistique Canada 9 GCE nominal: Federal government Final annual estimation  Divided into budgetary and extra budgetary components  Budgetary – accounting system data  Extra budgetary- annual and sub- annual financial reports and statements of the extra- budgetary entities (about 100 entities)

01/11/2015 Statistics Canada Statistique Canada 10 GCE nominal: Federal government Final annual estimation Total budgetary expenditures Less Spending not on goods and services Transfer payments, Interest on public debt, Intergovernmental transfers, Transfers to extra- budgetary entities = Current and capital budgetary expenditures

01/11/2015 Statistics Canada Statistique Canada 11 GCE nominal: Federal government Final annual estimation  Extra-budgetary part  Transactions in the source documents are analyzed and those that are purchases of goods and services are identified and aggregated

01/11/2015 Statistics Canada Statistique Canada 12 GCE nominal: Federal government Final annual estimation  Current and capital expenditures – Capital spending + Capital consumption allowances + consumption of FISIM = Gross current expenditure on goods and services  Gross current expenditure on goods and services - Sales of goods and services = Net current expenditure on goods and services

01/11/2015 Statistics Canada Statistique Canada 13 GCE nominal: Federal government Preliminary annual estimation  Budgetary part  Similar to final annual estimation except that since the Public Accounts of Canada is not usually available for the most recent year, monthly reports are used.

01/11/2015 Statistics Canada Statistique Canada 14 GCE nominal: Federal government Preliminary annual estimation  Extra-budgetary part  Similar to final annual estimation  The main difference is source-data availability; for some extra-budgetary entities, financial statements are not available for the reference year and previous year annual estimates must be projected.

01/11/2015 Statistics Canada Statistique Canada 15 GCE nominal: Federal government Quarterly estimation  Budgetary part: same information source as preliminary annual estimates

01/11/2015 Statistics Canada Statistique Canada 16 GCE nominal: Federal government Quarterly estimation  Extra budgetary part: similar to annual estimation, but not as much data available for some entities.  In these cases, the most recent data are projected forward using an average growth rate.

01/11/2015 Statistics Canada Statistique Canada 17 GCE nominal: Provincial government Final annual estimation  Source documents: public accounts of each province and territory for budgetary components and audited financial statements and annual reports of extra-budgetary entities.

01/11/2015 Statistics Canada Statistique Canada 18 GCE nominal: Provincial government Final annual estimation  Current and capital expenditures – Capital spending + Capital consumption allowances + consumption of FISIM = Gross current expenditure on goods and services  Gross current expenditure on goods and services - Sales of goods and services = Net current expenditure on goods and services

01/11/2015 Statistics Canada Statistique Canada 19 GCE nominal: Provincial Health Final annual estimation  Public health and social services: includes hospitals, residential care facilities and other health and social service entities  Data sources include Canadian Institute for Health Information (CIHI), Statistics Canada surveys and provincial health ministry records

01/11/2015 Statistics Canada Statistique Canada 20 GCE nominal: Provincial Health Final annual estimation  Public health and social services:  GCE is obtained by summing their operating expenditures. These surveys and records also provide the information to estimate sales of goods and services.

01/11/2015 Statistics Canada Statistique Canada 21 GCE nominal: Provincial post-secondary Final annual estimation  Public universities and colleges: expenditures on goods and services as well as sales of goods and services are obtained by Statistics Canada surveys

01/11/2015 Statistics Canada Statistique Canada 22 GCE nominal: Provincial government Preliminary annual estimation  Source information: budget estimates, quarterly and monthly financial reports obtained directly from governments and their subordinate entities

01/11/2015 Statistics Canada Statistique Canada 23 GCE nominal: Provincial health Preliminary annual estimation For public health, social and universities, and post- secondary education, estimates for the more current years are projected using indicators such as provincial and territorial funding transfers and labour income time series.

01/11/2015 Statistics Canada Statistique Canada 24 GCE nominal: Provincial government Quarterly estimation  Information sources vary widely across jurisdictions: accounting-system information official budget estimates  public health, social services, and post- secondary education GCE growth rate is based on labour income

01/11/2015 Statistics Canada Statistique Canada 25 GCE nominal: Local government Final annual estimation  Information source: Financial reporting system information from municipalities is available from the Internet  Primary and secondary public education: data comes from census of provincial and territorial departments of education

01/11/2015 Statistics Canada Statistique Canada 26 GCE nominal: Local government Preliminary annual estimation  Sample surveys of information developed for budget estimate some financial statements is used  Primary and secondary public education: data comes from survey of provincial departments of education

01/11/2015 Statistics Canada Statistique Canada 27 GCE nominal: Local government Quarterly estimation GCE growth rate is based on labour income

01/11/2015 Statistics Canada Statistique Canada 28 GCE nominal: CPP & QPP Annual estimation  Administrative expenditures of the Canada Pension Plan and Quebec Pension Plan are obtained from the accounting statements of the plans for both the preliminary and final estimates.

01/11/2015 Statistics Canada Statistique Canada 29 GCE nominal: CPP & QPP Quarterly estimation  Quarterly accounting statements of the plans

01/11/2015 Statistics Canada Statistique Canada 30 Deflation of GCE  For deflation purposes, GCE is broken down into components.  The deflation is carried out in three broad segments: compensation of employees; capital consumption allowances; and, all other current expenditures.

01/11/2015 Statistics Canada Statistique Canada 31 Deflation of GCE - Compensation of employees  Represents about 60% of GCE  Hours worked is used as a measure of volume of labour input.  Hours worked is estimated using employment data multiplied by average hours worked per employee  Quality change in labour input

01/11/2015 Statistics Canada Statistique Canada 32 Deflation of GCE Capital consumption allowance Current and constant linear depreciation are calculated by asset type from a perpetual inventory of capital stock model.

01/11/2015 Statistics Canada Statistique Canada 33 Deflation of GCE Other nonwage current expenditures  Other non-wage GCE is broken down into four parts: defence medicare hospitals a remainder for all other outlays  Combined, they represent about 30% of net government expenditure on goods and services.

01/11/2015 Statistics Canada Statistique Canada 34 Deflation of GCE Other nonwage current expenditures  Defense: a combination of various material and average hourly earnings indexes  Medicare expenditures are deflated using a fee- benefits index for physicians  Hospital expenditures are deflated with a fixed- weighted index of commodities used in hospitals.

01/11/2015 Statistics Canada Statistique Canada 35 Deflation of GCE Other nonwage current expenditures  The remaining portion of GCE is deflated using a base-weighted composite price index covering major operating expenditure categories  Prices come mostly form CPI, some from IPPI  The weights come from the latest Input-Output Tables.