deficit procedure has been reinforced by introducing formal requirements of
completeness and internal consistency of fiscal data reported to the Commission and by
disciplining Eurostat’s interaction with member states through “dialogue” and
“methodological” visits. In order to improve transparency and accountability of national
statistical authorities, the Regulation mandates the public availability of data reported by
Member States as well as of inventories describing the methods, procedures and sources
used by member states, and requires the publication by Eurostat of regular reports on the
quality of data. To bolster the operational capacity of the Commission, Eurostat has
conducted an internal redeployment of staff in order to reinforce the activities linked to
the validation of economic and fiscal accounts and created a dedicated unit. Finally, the
directors of national statistical institute and Eurostat adopted a European Statistics Code
of Practice, defining standards for the independence of the national and community
statistical authorities. The Code lists a set of indicators to be used to review the
implementation of the Code itself. The Commission is setting up a reporting system to
monitor adherence to the Code of Practice by the national statistical authorities and
Eurostat.
The analysis of SFA along the breakdown suggested in the chapter may enhance the
effectiveness of these reform efforts. To this end, the reconciliation account between
deficit and change in debt reported in the notifications should identify all financial assets
and therefore there should be no residual item labelled as “other assets”. Moreover,
national authorities should routinely provide justification for cash-accrual differences in
annual data for individual accounting items. In due time Member States should also be
requested to provide a full set of government accounts covering both deficit formation
and its financing. Such a set of accounts should include both cash and accrual figures.
Given the unavoidable information asymmetry between the community and Member
States, ensuring the independence of the national statistical institutions is crucial. This is
not just an issue of enforcement of fiscal rules; it is an issue of accountability to the
public and of good management of public resources.
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