1. Constructing Scottish quarterly GDP estimates – income based Sandy Stewart OCEA 7 May 2009

2. Starting point UK Regional Accounts –Annual –1987 – 2006 (balanced to blue book) –2007 (unbalanced – i.e. statistical discrepancy) –NUTS1 countries and regions + extra regio –Income components –SIC codes (A01, A02, B, CA, CB, DA, DB, DC, DD, DE, DF, DG, DH, DI, DJ, DK, DL, DM, DN, E, F, G, H, I, J, K, L, M, N, O, P) –Raw & Headline (Smoothed) UK National Accounts –UK Economic Accounts – quarterly –UK Blue Book – annual balances

3. Income Components - 2006 Compensation of Employees– 62.7% Mixed Income - 5.8% Gross Trading Profits-20.8% Holding Gains- -0.4% NMCC- 1.5% Rental Income- 8.2% Taxes less Subsidies- 1.5% Total- 100.0%

4. UK apportionment 1. Compensation of Employees Employment (STES) x Earnings (ASHE) STES –Quarterly –MFT FFT MPT FPT –SIC (AB, C, D, E, F, G, H, I, J, K, L, M, N, O, P, DA, DL) –ABI1 (more detail but 2007 latest and annual) –Other data from DASA, DEFRA/SG, PAYE for constraining to NUTS1 ASHE –Annual –MFT FFT MPT FPT –SIC (A01, A02, B, CA, CB, DA, DB, DC, DD, DE, DF, DG, DH, DI, DJ, DK, DL, DM, DN, E, F, G, H, I, J, K, L, M, N, O, P) –2008 (latest, but definitional changes over time) –Northern Ireland issues

5. UK apportionment 2. Mixed Income Regional data from HMRC (as in Regional Accounts) – only available annually DEFRA/SG ABI2 – for manufacturing Balancing item Gross Trading Profits/Operating Surpluses ABI2 for certain industries Employment proxies otherwise GERS analysis for Public Corporations

6. UK apportionment 3. Holding Gains ABI2 for certain industries Employment proxies otherwise NMCC Regional Accounts methodologies More investigation required for sectoral components (hospital beds etc) Use of actual data on depreciation - WGA

7. UK apportionment 4. Rental Income Consider house prices (CLG, Nationwide, HBOS) GERS analysis for Public Corporations Taxes less Subsidies (on production) GERS (annual) and SNAP (quarterly) analysis for taxes DVLA for vehicle duties (corporations) SG/CLG – for distribution of NNDR Subsidies – own data for CAP, ESF, LG – otherwise GVA apportionment

9. Other alignment issues Statistical discrepancies –Aligning income-based estimates to output- based estimates for unbalanced years –Apportioning UK SD to Scotland Alignment Adjustments –Preserving quarterly output patterns –Sum to zero over a year

10. Issues for discussion Any views on data sources? How to avoid step changes – ASHE cubic splining Whether to constrain components to Regional Accounts Treatment of statistical discrepancies and alignment adjustments When to seasonally adjust in the process Publication as experimental statistics