Cost analysis of key statistical products Pieter Everaers, Director Eurostat European Commission CCSA, Paris 29 September 2016

Value and benefits of official statistics Value defined as 'the importance, worth, or usefulness of something' (source: the Oxford English Dictionary). The value of official statistics materialises in the trust and confidence that users have in them – societal value. The value has a material dimension – how much does it cost?

Change of environment – new challenges for statistics The data revolution: a digital transformation is taking place across the globe. New metrics: globalisation has changed the world. The future of Europe: the evolution of official statistics as a public good reflects the evolution of the society. The price of statistics: how to cope with shrinking resources and the need to cut red tape further.

Statistics cost money, but then so do bad decisions How to estimate, manage and reduce these costs in the production of statistics ?

Cost analysis of key statistical products - why Recent development on Evidence based decision making – importance of official statistics/ resource constraints Industrial process (new sources) calls for assessing cost/benefits Justify work done – setting priorities (negative priorities) Benchmarking (more cost efficient) Contribution to efficiency gains and development of statistical processes

Relevant ESS initiatives and projects Statistics Catalogue of statistical products Analysis of cost accounting systems in the ESS Impact assessment of initiatives in the Commission Cost- analysis of European statistics (by products) Regulation on European Statistics 223/2009 Income generation survey by UK Cost assessment of official statistics in the ESS

Cost assessment: Output related (=on products) Legal basis EU regulations (>350 laws) ; guidelines Deliverables Data collections sent by NSIs and ONAs to Eurostat Dissemination Published on Eurostat's website Products cost per product in ESS cost structure per country

Scope of cost assessments initiatives on 'global' level Official statistics in the ESS ongoing Cost analysis on 'European' cost level– by product National European ongoing ESS countries Eurostat Cost/merit exercise √

Two approaches – top down and bottom up Cost assessment of the production of official statistics in ESS covers national and European statistics Bottom up: Cost analysis of European statistics (by products) For both : Same methodology used. Coverage: NSIs, ONAs and regional offices.

Cost assessment of official statistics in the ESS Top down approach Cost assessment of official statistics in the ESS Scope Coverage Methodology National NSIs - reference years: statistics ONAs 2012-2015 + Regional offices - accrual principal European - costs and FTE statistics Goal to have an ESS picture by mid-2017

European statistics' costs in ESS

Relevant ESS initiatives and projects Statistics Catalogue of statistical products Analysis of cost accounting systems in the ESS Impact assessment of initiatives in the Commission Cost- analysis of European statistics (by products) Regulation on European Statistics 223/2009 Income generation survey by UK Cost assessment of official statistics in the ESS

European statistics - Phase 1 Estimated 2014 direct costs in Eurostat Bottom up approach Cost-merit exercise European statistics - Phase 1 Estimated 2014 direct costs in Eurostat Multi domain indicators Accounting systems Primary data and indicators 11 mio euro 74 FTE 28 mio euro 109 FTE 43 mio euro 228 FTE 3 mio euro Partnership within the ESS and beyond 16 FTE

European statistics - Phase 1 Estimated total costs in Eurostat,2014 Cost-merit exercise   HR in FTE Costs in Eurostat Sub delegated Direct costs 427 84 mio € 27 mio € Indirect costs 316 65 mio € 8 mio € Total costs 743 150 mio € 34 mio €

European statistics - Phase 1 Merit assessment in Eurostat Cost-merit exercise European statistics - Phase 1 Merit assessment in Eurostat Global assessment on products by three focus groups on the following criteria: Policy use Legal requirements Competitive advantage Quality Multi-purpose statistics Applying a 15/70/15 distribution for high/medium/ low merits Merge the cost information with the results of the merit exercise – focus on products with high costs but low merits

European statistics - Phase 2 Costs on European statistics in the ESS by products Resources in NSIs, ONAs, regional offices For European statistics only; for the year 2015 Second step with 25 products and all ESS countries First step with 11 countries on 8 products; establishing methodology

European statistics – Product list The list ('Catalogue of products') covers more than 130 statistical products. It is annexed to the Annual Work Programme. Statistical products – examples: Annual national accounts Foreign direct investment Regional accounts Environmental taxes Business demography Innovation International trade in goods Demography and migration Education Health care

European statistics' costs in ESS, by products 28 Member states, 4 EFTA countries, Eurostat NSI : National Statistical Institutes. ONA: Other national statistical authorities.

Challenges encountered Different accounting systems in place in MSs - Lack of time registration system Definition of 'official' statistics Partners' involvement in the production of official statistics (NSIs, ONAs, regional offices) Role of Central banks Agreement on a common methodology

Benefit of cost assessment Contributes to resource allocation, cost transparency and priority-setting Motivates discussions on how to manage and reduce these costs in the production of statistics Use of cost information for benchmarking

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