News 30 Sep 2016

Classification decisions related to general government debt resolved

Statistics Finland and Eurostat have collaborated to assess the sector classification of certain public financial corporations and the recording of financial transactions in statistics. Now the open classification questions have been solved. 

Statistics Finland notified on 31 August 2016 that Statistics Finland and Eurostat were assessing the sector classification of Finnvera plc and Finnish Export Credit Ltd, as well as the correct way of recording cash collateral related to derivative agreements. The sector classification of Finnvera plc and Finnish Export Credit Ltd was assessed to establish whether the units were financial intermediaries classified into the financial corporations sector or captive financial institutions classified under general government.

Eurostat has now assessed that the activity of Finnvera (group, including, e.g. Finnish Export Credit Ltd) is financial intermediation and it does not have all the features of a captive financial institution. Therefore, Finnvera is still classified into the sector "Other financial intermediaries" (S.125). It will still be examined whether part of lending in Finnvera's domestic activity should be recorded in national accounts as central government's liabilities and assets.

Recording of cash collateral as part of general government debt

According to national accounts guidelines, received cash collateral related to derivative contracts and securities lending must be recorded as part of general government debt. At the beginning of this year, Statistics Finland launched a new data collection on employment pension schemes’ assets and liabilities. The data collection provided for the first time specified information on cash collateral related to employment pension schemes' derivative contracts and securities lending.

The items in question are now included in general government debt. At this point, they have now been added to the data for 2012 to 2015 because the general government deficit and debt reporting (EDP) submitted to Eurostat covers these years.

Previously, the items in question were included in other accounts payable, which are excluded from the definition of the EDP debt. The review made increased general government debt in 2012 to 2015 by 0.9 to 1.0 percentage points relative to gross domestic product.

News release published on 31 August 2016

Further information: Niina Suutarinen, tel. +358 29 551 2307