Experience of Banco de Portugal on the compilation and … · • Banco de Portugal had to provide...

Experience of Banco de Portugal on the compilation and publication of data

regarding government finance statistics

Session 3: Public Sector - The usefulness of data on the public sector

Meeting of the IMF Government Finance StatisticsAdvisory Committee,

Washington, D.C.March 14–16, 2017

João Cadete de Matos • Director| Statistics DepartmentSérgio Branco • Head of Division| Statistics Department

2 •

The usefulness of data on the public sector:Experience of Banco de Portugal

1. European definition of general government debt

2. Other government debt definitions, net debt andalternative measures

3. Looking forward: debt of public sector and contingentliabilities

4. Experience of Banco de Portugal

5. Conclusion

3 •






5. Conclusion

4 •



EU28EA19

BE

BG

CZ DK

DE

EE

EL

ES

FR

HR

IT

CYLV

LT

LU

HUMT

NL

AT

PL

PT

RO

SISK

FI

SE

UK

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

-15.0 -12.0 -9.0 -6.0 -3.0 0.0 3.0

Maa

stric

ht d

ebt a

s %

of G

DP

Net lending (+)/Net borrowing (-) as % of GDP

2010

-33.0

IE

Source: Eurostat

5 •



EU28

EA19

BE

BG

CZDK

DE

EE

IE

EL

ESFR

HR

IT

CY

LV LT

LU

HU

MTNL

AT

PL

PT

RO

SI

SK

FI

SE

UK

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

-15.0 -12.0 -9.0 -6.0 -3.0 0.0 3.0

Maa

stric

ht d

ebt a

s %

of G

DP

Net lending (+)/Net borrowing (-) as % of GDP

2015

Source: Eurostat

6 •


1. European definition of general government debt – Eurostat

Assets LiabilitiesCurrency and deposits

Debt securities

Loans

Maastrichtdebt

Other accounts payable and financial derivatives

Stock at end-

period

Stock at end-

period

Face valueFace value

Consoli-dated

Consoli-dated

7 •


1. European definition of general government debt – Eurostat

• The calculation of the debt indicator uses ESA2010 as areference: same sector and instrument definitions

• But there are differences from the stocks of liabilitiescompiled in financial accounts, namely:

1. Maastricht debt excludes some financial instruments2. Maastricht debt is an end-of-a-period position at

face value. In foreign denominated debt, theexchange rate agreed in swaps and FRAs affects thelevel of debt.

3. Maastricht debt is a gross definition (excludes theassets side)

8 •






5. Conclusion

9 •


European definition of general government debt

Maastricht debt and net debt

Financial assets Liabilities

Net financial

assetsAF1 Monetary gold and SDRs AF2 Currency and deposits AF3 Debt securities AF4 Loans AF5 Equity and investment fund shares AF6 Insurance pension and standardised guarantee schemes AF7 Financial derivatives and employee stock options AF8 Other accounts receivable/ payable

Maastricht debt Net debt

10 •


Example of net debt used in Portugal

Maastricht debt and Maastricht net debt of deposits of central government

60

70

80

90

100

110

120

130

14020

07Q

4

2008

Q4

2009

Q4

2010

Q4

2011

Q4

2012

Q4

2013

Q4

2014

Q4

2015

Q4

2016

Q4

As a

per

cent

age

of G

DP

Maastricht debt

Maastricht net debt of deposits of the central government

11 •


Wider definitions of general government debt

IMF


Net financial

assets AF1 Monetary gold and SDRs AF2 Currency and deposits AF3 Debt securities AF4 Loans AF5 Equity and investment fund shares AF6 Insurance pension and standardised guarantee schemes AF7 Financial derivatives and employee stock options AF8 Other accounts receivable/ payable

Total gross debt

Total net debt

12 •


Wider definitions of general government debt

Maastricht debt and Maastricht debt including trade credits, for Portugal

60

70

80

90

100

110

120

130

140

2007

Q4

2008

Q4

2009

Q4

2010

Q4

2011

Q4

2012

Q4

2013

Q4

2014

Q4

2015

Q4

2016

Q4

As a

per

cent

age

of G

DP

Maastricht debt

Maastricht debt including trade credits

13 •


Wider definitions of general government financial position

Financial accounts


Net financial

assets AF1 Monetary gold and SDRs AF2 Currency and deposits AF3 Debt securities AF4 Loans AF5 Equity and investment fund shares AF6 Insurance pension and standardised guarantee schemes AF7 Financial derivatives and employee stock options AF8 Other accounts receivable/ payable

Total liabilities

Net financial

worth

14 •


Wider definitions of general government financial position

General government liabilities and Maastricht debt, for Portugal

50

70

90

110

130

150

170

2000

Q4

2001

Q4

2002

Q4

2003

Q4

2004

Q4

2005

Q4

2006

Q4

2007

Q4

2008

Q4

2009

Q4

2010

Q4

2011

Q4

2012

Q4

2013

Q4

2014

Q4

2015

Q4

2016

Q3

As a

per

cent

age

of G

DP

Maastricht debt

General Government liabilities

15 •






5. Conclusion

16 •


Delimitation of the public sector

Public SectorPublic SectorPublic Sector

Non-financial public sector

General GovernmentGeneral GovernmentGeneral Government

Public corporationsPublic corporationsPublic corporations

General government

entities excluding

corporations

General government

entities excluding

corporations

General government

entities excluding

corporations

Public financial

corporations

Public non-financialcorporations



Public non-financial

corporations not included in

General Government



General Government



General Government

Public corporations

included in the General

government

Public corporations


government

Public corporations


government

17 •


Maastricht debt and debt of non-financial public sector, for Portugal

60

70

80

90

100

110

120

130

140

150

2007

Q4

2008

Q4

2009

Q4

2010

Q4

2011

Q4

2012

Q4

2013

Q4

2014

Q4

2015

Q4

2016

Q4

As a

per

cent

age

of G

DP

Maastricht debt

Debt of non-financial public sector

18 •


General government debt by subsector

50 53 56 5962 67 69 68

72

84

96

111

126129 130 129 130

-10

10

30

50

70

90

110

130

150

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

As a

per

cent

age

of G

DP

General government Central government Regional and local government

Social security funds Consolidation

19 •


Summary: “Layers” of government debt

Non-financial public sector debt

Maastricht debt

Budgetary central

government

Extrabudgetary units/entities


corporations

Public sector

Public financial

corporations

Non-financial public sector

Central government

General government

State and local

governments

Social security

funds(+) Liabilities

Debt securities

Loans

Currency and deposits

Trade credits

Other liabilities

Pension entitlements andother contingencies

(-) Financial assets

Inst

rum

ents

Gross debt

Net debt

20 •


Possible future liabilities of the general government sector

Guarantees granted by government

Pension entitlements of public social insurance schemes

Liabilities due to long-termcontracts:- Public-private partnerships

Non-performing loans:- Student loans- Import / export loans

Future liabilities

21 •






5. Conclusion

22 •



• 2011 – Financial Assistance Programme

• New statistical data requirements

• Banco de Portugal had to provide detailed information onpublic debt and other general government statistics

• Chapter K of Statistical Bulletin of Banco de Portugal wascreated so the public could benefit from the new datarequirements

23 •



• New data needs in the context of the Financial AssistanceProgramme

BEFORE AFTER

Availabilty• Quarterly

Deadline• 90 days after the end of the

quarter

Coverage• General Government

Availabilty• Monthly

Deadline• 30 days after the end of the month

Coverage• Non financial public setor (General

Government plus public non-financial corporations

24 •



New outputs

Debt bycreditor sector

Non-consolidateddebt

Maastricht debt net ofdeposits of thecentral government

Debt including trade credits

25 •



Maastricht debt

Trade creditsobtained bythe general governmet

Consolidatedgeneral

governmentdebt

Debtbetweengeneral

governmententities

Non-consolidated

general government

debt

Debt of public non-

financial corporations not included

in general government

Non-consolidated debt of non-

financial public sector

+ = =+ =+

State direct debt- Sector delimitation- Consolidation effects- Saving certificatescapitalized interest

26 •


“Indebtedness” – What is it?Financial instruments

• LoansGranted by banks;Granted by other credit institutions than banks; Granted by non-residents;Between non-financial corporations;Between non-financial corporations and households

• Debt securities

• Trade credits

• Deposits (namely Savings certificates and Treasury certificates issued by general government)

Stocks at end of period (and not transactions)Nominal value (and not market value)Accrued interest and not yet paid is not includedNon-consolidated information


27 •



Non-financial public sector indebtedness

A wider concept than Maastricht debt:- Includes all non-financial public entities

- Includes trade credits

- Includes debt between public entities

Detail by sector creditor

Monthly frequency

28 •


Non-financial Sector Indebtedness

It provides information about the indebtedness of the non-financial sector,combining several different dimensions of analysis, namely:

Debtor and creditor sector

Type of financial instrument

Original maturity

Economic activity

Size of the company


29 •



30 •


30


0%

5%

10%

15%

20%

25%

30%

35%

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

As a

per

cent

age

of G

DP

Public corporations debt

Public corporations not included inthe general government

Public corporations included in thegeneral government

31 •



• Statistical press releases

32 •



Impact on the general government deficit and debt of the measures to support financial institutions in Portugal | 2007 – 2015

-4

-2

0

2

4

6

8

10

12

2007 2008 2009 2010 2011 2012 2013 2014 2015

As a

per

cent

age

of G

DP

Impact on deficit Impact on debt

33 •


Public debt, potential liabilities and depositsPortugal | 2016(as a percentage of GDP)

130%Public Debt

+7%Guarantees*

+4%non-financial publiccorporations liabilities

+5%PPP liabilities*

+1%Non-performing loans

2%Trade credits

-9%Deposits of central government

Potencial impact on

public debt

+7%Consolidation

* 2015 figures

34 •






5. Conclusion

35 •


5. Conclusion

• The definition of public debt is not a closed concept• The definition of debt used in the European Union is one of the most restrictive concepts in terms of sector delimitation, valuation, instrument coverage and netting• The concept might be enlarged by including all of the public sector and not only the general government • An important challenge also to take into account: the treatment of future liabilities of governments, namely pension entitlements of public social insurance schemes, guarantees granted, and other off-balance-sheet liabilities• Banco of Portugal is already publishing in a monthly basis the Maastricht debt, including the Maastricht debt net of deposits of the central government, after 30 days of the end of the reference month. Other statistics concerning the non-financial public sector indebtedness are also released on a monthly basis• The demand for these statistics, and the number of headlines they generate, reveal that they are, in fact, widely appreciated by the users

36 •


João Cadete de Matos ([email protected])

Sérgio Branco ([email protected])

Thank you for your attention

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