The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA) reference document: C. Ardi – F. Falcitelli “The Classification of Resource Use and Management Activities and expenditure – CRUMA”, Istat, Rome, 2 August 2007 – ENV/EXP/WG/05 (2008) Eurostat Working Group “Environmental Expenditure Statistics” Meeting of May Luxembourg Federico Falcitelli Head, Economic accounts for the environment Eurostat, May 2008, Luxembourg

Summary CRUMA  Why has been developed  How has been developed  Reference points  Rationale  Content  What it includes  What it excludes  Fields of application in Italy  An example of figures  CRUMA versus other classification criteria (e.g. COFOG)  Who is discussing CRUMA The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg Why for the natural resource management field there is no an international agreed accounting system and classification, while for the environmental protection field EPEA and CEPA exist the attempts made so far (e.g. OECD/Eurostat 1999, SEEA2003) in order to fill this gap have led to heterogeneous solutions: CEPA for the environmental protection domain and classifications based on different structure and principles for the resource management domain in Italy there is a great demand of information on environmental expenditure concerning both domains (environmental protection and resource management) especially from Central and Local Government The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg How, Reference points (1/3) Main reference points…  SERIEE 1994, Ch. X  SEEA 2003, Ch. 5  OECD/Eurostat 1999 manual on environmental industries … for  Defining the scope of the natural resource management sector in terms of:  Definition of natural resources  Identification of the kinds of resource management activities The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg How, Reference points (2/3), Scope Natural resources (SERIEE 1994 §§ )  According to the generally accepted definition, natural assets correspond to non- produced assets: water (marine and inland), air, land (soil, ecosystems, etc.), wild flora and fauna, sub-soil assets, as well as living assets produced by human activities (livestock, plants).  Restrictions: Only those natural resources corresponding to non-produced natural assets whose use takes the form of goods, are dealt with in the natural resource use and management account. Hence, produced natural resources (livestock, plants) are excluded as well as those environmental services which result from uses of certain functions of natural assets (assimilation of pollutants, aesthetic value, etc.). Management activities (SERIEE §§ )  For the purpose of the account, management activities designate:  research for new resources,  withdrawals from existing resources,  activities aimed at reducing withdrawals (recovery, recycling, policies for saving or substitutes resources),  development and regulatory activities for certain resources (e.g. inland waters).  Activities which consist in the transformation of natural resources, i.e. corresponding to their use as input for the production of another product are not described in the account; however activities aimed at lowering their consumption, whether directly or indirectly are considered. Defining the scope The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg How, Reference points (3/3), List of Natural resources and Kinds of activities SERIEE 1994 SEEA 2003 The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg How, Rationale (1/3), Consistency with CEPA To set up a classification fully consistent with CEPA in terms of:  Classification principles:  main purpose criterion and  the technical nature of the activity  The twofold classification criteria of the activities:  by environmental domain and  by kind of activity  The method for building the classification:  first: to set up a classification matrix, i.e. a [type of activity] by [environmental domain] matrix  second: to fill in the matrix The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg How, Rationale (2/3), CEPA2000 classification matrix: [type of activity] by [environmental domain] Environmental domain: type of environmental media or pollution-nuisance- degradation Type of activityAir pollution (and related climatic risks) Surface water pollution WasteSoil and ground water pollution, erosion and other physical degradation of soil Noise and vibration Degradation of biodiversity and landscape Radiation Pollution/degradation prevention activities Pollution/degradation reduction activities - reduction of emissions and discharges - reduction of pollution levels and degradation of environmental media Measurement and control activities Research and development activities Teaching and training activities Administrative activities The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg How, Rationale (3/3), CRUMA classification matrix: [type of activity] by [natural resource] The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA) Natural resources Type of activityInland waters Natural forest resources Wild flora and fauna Fossil energy Raw materials Reduction of the intake of natural resources through preventive in-process modifications Use of alternative resources Reduction of losses, leaks and scraps Reduction of the intake of natural resources indirectly through the reduction of the consumption of natural resource-related products (energy savings, water savings, etc.) Reuse, recycling Increase/recharge of natural resource stocks Direct management of natural resource stocks (mobilization/exploitation, exploration, extraction, treatment, distribution, etc.) Measurement and control activities Research and development activities Teaching and training activities Administrative activities

Eurostat, 2 October 2007, Luxembourg Content, What it includes, CRUMA list 1/2 10 Use and management of inland waters 10.1 Reduction of the intake 10.2 Reduction of water losses and leaks, water reuse and savings 10.3 Replenishment of water stocks 10.4 Direct management of water stocks 10.5 Measurement, control, laboratories and the like 10.6 Other activities 11Use and management of natural forest resources 11.1Reduction of the intake 11.2Reduction of the consumption of forest (wood and non wood)-related products 11.3Reforestation and afforestation 11.4Forest fires 11.5Direct management of forest areas (as a resource and not as a habitat) 11.6Measurement, control, laboratories and the like 11.7Other activities 12Use and management of wild flora and fauna 12.1Reduction of the intake 12.2Replenishment of wild flora and fauna stocks 12.3Direct management of wild flora and fauna stocks 12.4Measurement, control, laboratories and the like 12.5Other activities 13Use and management of fossil energy 13.1Reduction of the intake 13.2Reduction of heat and energy losses, and energy savings 13.3Direct management of the stocks of non- renewable energy sources 13.4Measurement, control, laboratories and the like 13.5Other activities The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg Content, What it includes, CRUMA list 2/2 14Use and management of raw materials 14.1Reduction of the intake 14.2Reduction of raw materials use through the reduction of scraps and the production and consumption of recycled materials and products 14.3Direct management of raw material stocks 14.4Measurement, control, laboratories and the like 14.5Other activities 15Research and development activities for natural resource use and management 15.1Inland waters 15.2Natural forest resources 15.3Wild flora and fauna 15.4Fossil energy 15.5Raw materials 15.6Other R&D activities for natural resource use and management 16.Other natural resource use and management activities 16.1General administration of natural resources General administration, regulation and the like Environmental management 16.2Education, training and information 16.3Activities leading to indivisible expenditure 16.4Activities not elsewhere classified Remarks on 16.1 and 16.2 categories: If the general administration activities and general education, training and information activities concern both environmental protection and use and management of natural resources, they should be broken down between positions 16.1 and 16.2 and the corresponding CEPA categories (  CEPA 9.1 and 9.2). If this is impossible, they should be classified alternatively in CRUMA categories or in the CEPA ones according to the “main purpose” criterion; if this is impossible as well, they should be classified within the corresponding CEPA categories (  CEPA 9.1 and 9.2) The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg Content, What it excludes The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA) Natural Hazards (list from SEEA2003, 5.60) CEPACRUMA Forest firesYes, Class 6Yes, Class 11 FloodsnoYes, Class 10 Avalanchesno LandslidesYes, Class 4no Stormsno Droughtsno Earthquakesno Volcanic eruptionsno CRUMA and CEPA exclude Natural risk management activities, with a few exceptions

Eurostat, May 2008, Luxembourg Fields of application in Italy A complete RUMEA is currently building for the whole economy for CRUMA 10 - inland waters (no data on ancillary activities) The whole CRUMA is applied to the general government; the figures produced are given to the national accounts department for producing data on General Government expenditure by COFOG according to the ESA95 requirements The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg An example of figures: Italian regions (NUTS II), 2005 Distribution of intermediate consumption + current and capital transfers + gross fixed capital formation The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, 2 October 2007, Luxembourg Correspondences to COFOG SERIEECOFOG CEPA 2000 (EPEA)… corresponds to … 1protection of ambient air and climate5.3Pollution abatement 2wastewater management5.2Waste water management 3waste management5.1Waste management 4protection and remediation of soil, groundwater and surface water5.3Pollution abatement 5noise and vibration abatement5.3Pollution abatement 6protection of biodiversity and landscapes5.4Protection of biodiversity and landscape 7protection against radiation5.3Pollution abatement 8R&D for environmental protection5.5R&D Environmental protection 9other environmental protection activities5.6Environmental protection n.e.c. CRUMA (RUMEA)… falls in … 10use and management of inland waters Agriculture (irrigation and drainage systems) Water supply 11use and management of natural forest resources4.2.2Forestry 12use and management of wild flora and fauna4.2.3Fishing and hunting 13use and management of fossil energy4.3Fuel and energy 14use and management of raw materials4.4.1Mining of mineral resources other than mineral fuels 15R&D for natural resource use and management R&D Agriculture, forestry, fishing and hunting R&D Fuel and energy R&D Mining, manufacturing and construction R&D Housing and community amenities 16other natural resource use and management activitiesno specifc correspondance the code “ Multi-purpose development projects” can be used for multi purpose activities concerning several RUM activities falling within division 04 The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg CRUMA versus other classification criteria The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA) Sustainable economic activities (list from OECD/Eurostat 1999) CEPACRUMA Sustainable agricultureYes, Classes 4, 6Yes, Class 10 Sustainable fisheriesYes, Class 6Yes, Class 12 Sustainable forestryYes, Classes 4, 6Yes, Class 11 Sustainable transportYes, Classes 1, 5Yes Class 13 Eco-tourismYes, Several classes (1, 2, 3, 6, 9, …) Yes, Several classes (10, 13, 16, …) Env. activities classified by economic activity Env. activities classified by env. domain or nat. res. The concept of “(environmentally) sustainable” economic activities, used in the OECD/Eurostat classification, cross cuts CEPA and CRUMA categories

Eurostat, 2 October 2007, Luxembourg Who is discussing CRUMA Eurostat Working Group “Environmental Expenditure Statistics”  Task Force on EGSS  Reflection Group on natural Resource Use and Management Expenditure Accounts (RUMEA) London Group  Issue paper on classification of RUM activities and expenditures, with the contribution of the Eurostat Reflection Group on RUMEA So far the CRUMA has been considered a good starting point to work on with a view to develop a standard classification for RUMEA purposes The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)

Eurostat, May 2008, Luxembourg Thank you for the attention The Istat Classification of Resource Use and Management Activities and expenditure (CRUMA)