reproductions of this material, or any parts of it, should refer to the imf statistics department as...

Reproductions of this material, or any parts of it, should refer to the IMF Statistics Department as the source.

Government Finance DivisionIMF Statistics Department

9th Meeting of the Advisory Expert Group on National Accounts

September 8–10, 2014, Washington D.C.

Claudia Dziobek, Chief - IMF Government Finance Division

Tuesday, September 9, 2014 (Afternoon Session-Item 14)

The Use of Indicators on Deficit and Debt


Overview GFS and National Accounts Availability of International Guidelines for Debt Data

Compilation Sources of Differences in Debt Data A Cascading Approach to Presenting Debt Data Way Forward

2


GFS and National Accounts

GFSM 2014 aligned with 2008 SNA Government a major sector GFSM 2014 framework requires additional information

to NA data for more detailed fiscal analysis e.g.,• Different aggregates (revenue, expense, expenditure)• Detailed breakdown of taxes, subsidies, other government

revenue• Consolidation

IMF GFS questionnaire seeks more detailed information than that available from NA compilation.

3



GFSM Framework has four alternative measures of the deficit / surplus:• Net/gross operating balance• Net lending/net borrowing (NLB)• Cash surplus/deficit• Total financing

Other surplus / deficit indicators are also widely used e.g.• Primary balance (or primary surplus / deficit)• Structural / cyclical balances

All these indicators provide an indication of the in-year fiscal position.

4



Government gross debt a key fiscal indicator:• Defined as a subset of total government liabilities – six debt

instruments Debt securities Loans Currency and deposits SDRs Other accounts payable Insurance, pension and standardized guarantee schemes

For debt statistics, analytical need for debt at different valuations (not just market values)

5


Availability of International Guidelines for Debt Data Compilation

International guidelines for compiling debt well established:• Government Finance Statistics Manual 2014;• Public Sector Debt Statistics: Guide for Compilers and Users;

and• External Debt Statistics: Guide for Compilers and Users

(EDSG), 2011.

In practice, differences in debt data limit cross country comparability

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Sources of Differences in Debt Data

Differences arising from:

• Institutional sector coverage – central government? general government? public sector? other?

• Debt instrument coverage – just debt securities and loans, or wider coverage of debt instruments?

• Valuation – market, nominal, or face value

• Consolidation - consolidated or unconsolidated debt?

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Sources of Differences in Debt DataInstitutional Sector Coverage

Public SectorGeneral Government

Central Government

Public Nonfinancial Corporation Public Financial Corporation

0102030405060708090

100110120130140150160170180

quarter

Gross Debt in Canada by Sector

8

Includes State and Local

139%

106%

49%

Source=World Bank/IMF /OECD Quarterly Public Sector Debt Statistics Database

Canada’s Gross Debt by Sector (in percent of GDP)


Sources of Differences in Debt DataDebt Instrument Coverage

9

Note magnitude of Pension Liabilities

Source = Government Finance Statistics Yearbook (GFSY)

Australia: Debt Instruments (in percent of GDP)


Cascading Approach to Presenting Government Debt Data

Levels of Government

GL1 – Budgetary Central Government

GL2 – GL1 plus extrabudgetary units and social security funds

GL3 – GL2 plus state and local governments

GL4 – GL3 plus nonfinancial public corporations

GL5 – GL4 plus financial public corporations

Aggregations of Debt Instruments

D1 – debt securities and loans

D2 – D1 plus SDRs and currency and deposits

D3 – D2 plus other accounts payable

D4 – D3 plus insurance, pensions and standardized guarantee schemes

10


Cascading Approach to Presenting Government Debt Data

11

Financial public corporations

Nonfinancial public corporations

Local governments

State governments

Social security funds GL3

Extra-budgetary units GL2

Budgetary central government GL1

Addition of debt instruments* Special Drawing Rights

** Insurance, pensions and standardized guarantee schemes

GL5GL4

IPSG

S**

D1

D4

D2

D3

Debt

sec.

Loan

s

SDRs

*

Curr

ency

and

dep

.

Acct

s pay

able


Country Examples: China P.R. Hong Kong

12

China PR - HK 2012

GL3 - Consolidated General Government

D1 4.0

D4 41.4

D2 4.0

D3 6.7

Very low levels of debt in D1-D3 – most debt is employment related pensions for civil servants


Iceland 2012

D1

D2

D3

D4

GL1 - Budgetary Central Government

GL2 - Consolidated Central Government


88.7 88.7 97.0

117.5 117.5 131.9

88.7 88.7 97.0

93.8 93.8 105.2

Country Examples: Iceland

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Major increase in Icelandic debt is from D3 to D4 at all levels of government

GL3/D3 = 105 percent of GDPGL3 / D4 = 132 percent of GDP


D1 79.1 94.2

D4 93.8 122.5

D2 79.6 94.7

D3 81.0 100.7

USA 2012

GL2 - Consolidated Central Government


Country Examples: USA

14

Some debt securities issuance by State and Local Governments – emphasizes importance of general government data

D1/GL1 is 79 percent of GDP. D4 /GL3 is 122 percent of GDP


Way Forward

The IMF is adopting the cascading approach in the recently updated questionnaire to collect data from member countries for publication in the 2014 GFSY

• Countries or regions are also allowed to disseminate a debt aggregate using their national definitions of debt

The same approach is adopted for the presentation of government/public sector debt data in the World Bank/IMF/OECD Public Sector Debt Statistics database

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reproductions of this material, or any parts of it, should refer to the imf statistics department as...

Documents

debt slide

public sector debt statistics

debt data differences

compiling debt

unconsolidated debt

users external debt

sna government

debt instrument coverage