The decisions made by the Office for National Statistics (ONS) Economic Statistics Classification Committee (ESCC) determine how organisations, transactions and balance sheet levels are to be treated in the UK economic statistics. In the vast majority of cases, the guidelines and rules of the European System of Accounts 2010 and the associated manuals provide sufficient clarity on how such classification decisions should be implemented in both the UK National Accounts and public sector finances (PSF) statistics.
However, there may be times when there is more than one way in which classification decisions can be reflected in fiscal statistics while maintaining consistency with the rules and guidelines. In such cases, the Public Sector Finances Technical Advisory Group (PSFTAG) makes a judgement and considers how the classifications decisions are best reflected in the PSF statistics.
Typical areas that PSFTAG considers include:
whether assets should be considered “liquid” and so netted off in public sector net debt (PSND), as “liquid” is not a concept defined in the national accounts manuals
clarifying whether certain revenue or expenditure should be presented in the PSF statistics as “current receipts”, “current expenditure” or “net capital expenditure” – which are all PSF concepts and are not defined in the national accounts manuals
where necessary, considering how ESCC classification decisions should impact fiscal aggregates, such as PSND, by applying the principles established in the 2013 Review of the PSF statistics
It should be emphasised that ESCC is responsible for making all classification decisions relating to economic statistics, in accordance with national accounts manuals, and the majority of classification decisions follow through straightforwardly to the PSF statistics and are not considered by PSFTAG. PSFTAG is only convened where specific issues that require its attention are identified. In this way, the role of PSFTAG is limited in the classifications process, and the advisory group has a distinct purpose to that of ESCC.
Information on the governance and membership of PSFTAG can be found in Section 4 of the methodology article Clarifying how Public Sector Finances classification decisions are made, published in July 2016.