Proposal for a Regulation of the European Parliament and of the Council on the European system of integrated social protection statistics (ESSPROS)
Date: 2006-01-20
Institutions: European Commission
Subjects: EU Member State, EU statistics, European social policy, data transmission, social security, statistical method

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 20.01.2006 
COM(2006) 11 final 

2006/0004(COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on the European system of integrated social protection statistics (ESSPROS) 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

110 

•  Grounds for and objectives of the proposal 

The Lisbon European Council of 23 and 24 March 2000 gave impetus to a process of 
policy  exchange  among  the  Member  States  of  the  EU  on  the  modernisation  of  social 
protection systems. The Commission Communication (2003) 261 of May 2003 entitled 
"Strengthening  the  social  dimension  of  the  Lisbon  strategy:  Streamlining  open 
coordination  in  the  field  of  social  protection"  includes  a  statement  on  the  need  for 
indicators.  ESSPROS  is  mentioned  as  a  key  instrument.  The  proposal  for  a  legal 
framework for ESSPROS (European System of Integrated Social Protection Statistics) 
will improve the usefulness of current data collections in terms of timeliness, coverage 
and comparability. 

120 

•  General context 

As agreed at the European Council of October 2003 in the context of streamlining the 
open method of coordination (OMC), an annual Joint Report on Social Inclusion and 
Social Protection will become the core reporting instrument. OMC in the fields of both 
Social  inclusion  and  Pensions  requires  data  from  ESSPROS,  thus  reflecting  the  need 
for comparable, timely and reliable statistics in the area of social policy. 

The current data from ESSPROS are recognised as being the lowest statistical common 
denominator to which the numerous variations in the national welfare systems can be 
reduced. The current yearly data collection on social protection is done on a voluntary 
basis  (gentlemen's  agreement)  and  is  now  based  on  a  common  comprehensive 
methodology  (ESSPROS  Manual  1996).  The  collection  was  previously  based  on  a 
1981 methodology, which replaced the Social Accounts started in 1963 for six Member 
States. 

There is a need to improve the timeliness of data collections, which can only be solved 
by  the  networking  of  national  data  providers  collecting  data  from  a  wide  variety  of 
sources.  Widening  coverage  to  include  qualitative  data  in  order  to  complete  and 
improve  quantitative  data  on  expenditure  and  receipts  by  scheme  will  provide 
comprehensive  knowledge  of  the  different  systems  and  thus  make  for  comparative 
analysis.  Widening  the  coverage  by  completing  gross  benefits  with  net  benefits  and 
identifying  the  impact  of  the  fiscal  system  on  social  protection  will  allow  more 
comparable data between Member States to be available, in particular on the amount of 
social  benefits  really  received  by  beneficiaries.  The  OMC  on  pensions  requires 
information on these beneficiaries. As a unique data source, the output of the module 
on  pension  beneficiaries  will  make  it  possible  to  assess  how  pension  systems  are 
evolving. 

130 

•  Existing provisions in the area covered by the proposal 

Council  Recommendation  of  27  July  1992  on  the  convergence  of  social  protection 
objectives and policies (92/442/EEC) 

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141 

•  Consistency with the other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

219 

Not relevant 

•  Collection and use of expertise 

221 

Scientific/expertise domains concerned 

The  experts  consulted  came  from  the  National  Statistical  Systems,  representing 
National Statistical Institutes, Ministries of Social Affairs and other bodies involved in 
the production of ESSPROS data. 

222 

223 

Methodology used 

Written consultation and discussion in Working Group meetings. 

Main organisations/experts consulted 

A  first  draft  of  the  proposed  text  was  presented  to  the  Working  Group  on  Social 
Protection Statistics held on 12 and 13 April 2005. Member States were invited to send 
detailed comments on the draft proposal to Eurostat. A second draft was then prepared 
and sent for a second round of written comments on 20 June 2005. A revised proposal 
was submitted for opinion at the meeting of the Directors of Social Statistics on 28 and 
29 September 2005. 

2249 

Summary of advice received and used 

225 

226 

The existence of potentially serious risks with irreversible consequences has not been 
mentioned. 

Most  of  the  comments  received  throughout  this  process  were  taken  into  account  and 
helped to clarify, refine and simplify the proposed text. 

Means used to make the expert advice publicly available 

The results of the first expert discussions were included in the minutes of the meeting 
of  the  Working  Group  on  "Social  Protection  Statistics"  and  in  the  minutes  of  the 
meeting of Directors of Social Statistics. 

230 

•  Impact assessment 

The  alternative  would  be  to  continue  working  under  a  gentlemen's  agreement  for  the 
production  of  social  protection  statistics.  However,  this  would  not  guarantee  the 
availability of all statistics and indicators required for policy-making at EU level. 

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The second alternative would be for the proposal not to include modules. This would 
mean  having  to  present  any  module  as  one  or  more  separate  Council  and  European 
Parliament Regulations.  

3)  LEGAL ELEMENTS OF THE PROPOSAL 

305 

•  Summary of the proposed action 

The objective of this Regulation is to establish a framework for current and foreseeable 
activities  in  the  field  of  social  protection  statistics. The current yearly  data collection 
on  social  protection  (gentlemen's  agreement)  covers  data  on  expenditure  and  receipts 
by  social  protection  scheme  (the  so-called  ESSPROS  core  system)  and,  from  2004, 
data  on  pension  beneficiaries.  Pilot  data  collections  on  net  social  benefits  will  be 
prepared. 

The  proposed  Regulation  will  be  supplemented  by  Commission  implementing 
Regulations:  firstly,  the  core  system  includes  both  quantitative  and  qualitative 
information;  the  second  will  be  the  module  on  pension  beneficiaries.  The  module  on 
net  social  protection  benefits  will  be  the  subject  of  a  Commission  Regulation  should 
the results of feasibility studies and pilot data collections be positive. 

310 

•  Legal basis 

Article  285  provides  the  legal  basis  for  Community  statistics.  The  Council,  acting  in 
accordance with the co-decision procedure, has to adopt measures for the production of 
statistics where necessary for the performance of the activities of the Community. This 
Article  sets  out  requirements  relating  to  the  production  of  Community  statistics  and 
requires  conformity  to  standards  of  impartiality,  reliability,  objectivity,  scientific 
independence, cost-effectiveness and statistical confidentiality. 

320 

•  Subsidiarity principle 

321 

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The  subsidiarity  principle  applies  insofar  as  the  proposal  does  not  fall  under  the 
exclusive competence of the Community. 

The  objectives  of  the  proposal  cannot  be sufficiently  achieved  by  the  Member  States 
alone for the following reasons: 

In accordance with the principle of subsidiarity as set out in Article 5 of the EC Treaty, 
the objective of the proposed action, namely the systematic submission of harmonised 
data on Community Social Protection Statistics, cannot be sufficiently achieved by the 
Member  States  acting  individually  and  can  therefore  be  better  achieved  by  the 
Community. 

Experience has shown that Member States collect data on Social Protection but use a 
variety of concepts and definitions which result in the non-comparability of data at EU 
level  and  thus  seriously  reduce  their  usefulness  for  the  purposes  of  analysing  social 
protection systems in the EU. 

Community action will better achieve the objectives of the proposal for the following 

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324 

325 

327 

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341 

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reasons: 

The  Regulation  provides  for  the  coordination  and  harmonisation  of  social  protection 
data  at  EU  level.  Although  the  Commission  is  best  able  to  organise  the  collection  of 
Community statistics, the Member States are responsible for organising and operating 
the national statistical  systems. The statistics covered are broadly based on Eurostat's 
existing  annual  social  protection  data  collection  and  the  recent  collection  on  pension 
beneficiaries.  However,  the  Regulation  accommodates  the  possibility  of  using  other 
sources  and  developing  additional  statistical  tools  if  necessary  to  cover  clearly 
identified emerging information needs. 

It  is  essential  that  EU-wide  information  is  available  to  support  the  open  method  of 
coordination in the fields of Social inclusion and Pensions. 

The  analysis  of  Community  Social  Protection  Statistics  has  to  be  undertaken  at  EU 
level using harmonised and comparable data. 

The proposal therefore complies with the subsidiarity principle. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reasons: 

It is recognised that there are wide variations in the structures of the Social Protection 
Systems in the Member States and, consequently, that there are differences in the tasks 
of  the  national  authorities  in  collecting  and  compiling  the  data  on  Social  Protection. 
Accordingly, the national authorities may use the techniques for the collection of data 
that  are  appropriate  for  the  way  the  systems  are  organised.  In  accordance  with  the 
principle of proportionality, this Regulation confines itself to the minimum required to 
achieve this objective and does not go beyond what is necessary for that purpose. 

The  Regulation  will  establish  a  well  defined  framework  for  the  production  of 
Community  social  protection  statistics  and  in  this  way  facilitate  the  availability, 
planning and more efficient use of resources both at the Community and other levels 
involved (national, regional, local). 

•  Choice of instruments 

Proposed instrument: regulation. 

Other means would not be adequate for the following reason: 

Selection  of  the  appropriate  category  for  an  act  of  the  EP/Council  depends  on  the 
legislative  goal.  Given  the  information  needs  at  European  level,  the  trend  for 
Community statistics has been to use regulations rather than directives for basic acts. A 
regulation is preferable because it lays down the same law throughout the Community, 
leaving the Member States with no power to apply them incompletely or selectively; it 
is directly applicable, which means that it need not be transposed into national law. In 
contrast,  directives,  which  aim  at  harmonisation  of  national  laws,  are  binding  on 
Member States as regards their objectives, but leave the national authorities the choice 
of  form  and  methods  used  to  obtain  the  objectives  agreed  upon  at  Community  level; 

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they must be transposed into national law. 

4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

5)  ADDITIONAL INFORMATION 

•  European Economic Area 

409 

560 

The proposed act concerns an EEA matter and should therefore extend to the European 
Economic Area. 

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2006/0004 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on the European system of integrated social protection statistics (ESSPROS) 

(Text with EEA relevance) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
285(1) thereof, 

Having regard to the proposal from the Commission1, 

Having regard to the opinion of the European Economic and Social Committee2, 

Acting in accordance with the procedure laid down in Article 251 of the Treaty3, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

Article 2 of the Treaty establishing the European Community lists the promotion of a 
high level of social protection as one of the tasks of the European Community. 

The  Lisbon  European  Council  of  March  2000  gave  impetus  to  a  process  of  policy 
exchange among the Member States on the modernisation of social protection systems. 

A Social Protection Committee was established by Council Decision of 29 June 2000 
(2000/436/EC)  in  order  to  serve  as  a  vehicle  for  cooperative  exchange  between  the 
European  Commission  and  the  Member  States  of  the  EU  about  modernising  and 
improving social protection systems. 

The  Commission  Communication  (2003)261  of  May  2003  outlined  a  strategy  for 
streamlining the processes of open co-ordination in the social policy area with a view 
to  strengthening  the  position  of  social  protection  and  social  inclusion  within  the 
Lisbon  strategy.  As  agreed  by  the  Council  in  October  2003,  streamlining  will  come 
into effect from 2006 onwards. In this context, an annual Joint Report will become the 
core  reporting  instrument,  with  the  task  of  bringing  together  the  key  analytical 
findings  and  political  messages  pertaining  both  to  the  OMC  in  the  different  strands 
where it is applied and to cross-cutting issues in social protection. 

1 
2 
3 

OJ C , , p. . 
OJ C , , p. . 
OJ C , , p. . 

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(5) 

(6) 

(7) 

(8) 

The  Open  Method  of  Coordination  (OMC)  has  put  a  new  focus  on  the  need  for 
comparable,  timely  and  reliable  statistics  in  the  social  policy  area.  In  particular, 
comparable statistics on social protection will be used in the annual Joint Reports. 

The Commission (Eurostat) is already collecting yearly data on social protection from 
the  Member  States  on  a  voluntary  basis.  This  action  has  become  a  consolidated 
practice  in  the  Member  States  and  is  based  on  common  methodological  principles 
designed to ensure comparability of data. 

The  production  of  specific  Community  statistics  is  governed  by  the  rules  set  out  in 
Council Regulation (EC) No 322/97 of 17 February 1997 on Community Statistics. 

The measures necessary for the implementation of this Regulation should be adopted 
in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the 
procedures for the exercise of implementing powers conferred on the Commission. 

(9) 

After consulting the Statistical Programme Committee, 

HAVE ADOPTED THIS REGULATION: 

Article 1 

Subject matter 

The  objective  of  this  Regulation  is  to  set  up  the  European  System  of  integrated  Social 
Protection Statistics, hereinafter referred to as “ESSPROS”, by providing: 

(a) 

(b) 

a  methodological  framework  (based  on  common  standards,  definitions, 
classifications  and  accounting  rules)  to  be  used  for  compiling  statistics  on  a 
comparable basis for the benefit of the Community; 

time  limits  for  the  transmission  of  statistics  compiled  in  accordance  with 
ESSPROS. 

Article 2 

Definitions 

For the purpose of this Regulation, the following definitions shall apply: 

(a) 

(b) 

“Community  statistics”  shall  have  the  meaning  assigned  to  it  in  Article  2  of 
Regulation (EC) No 322/97. 

“Social protection” encompasses all interventions from public or private bodies 
intended to relieve households and individuals of the burden of a defined set of 
risks or needs, provided that there is neither a simultaneous reciprocal nor an 
individual arrangement involved. The list of risks or needs that may give rise to 
social  protection  is  fixed  by  convention  as  follows:  Sickness/Health  care; 
Disability;  Old  age;  Survivors;  Family/children;  Unemployment;  Housing; 
Social exclusion not elsewhere classified. 

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(c) 

(d) 

“Social  protection  scheme”:  distinct  body  of  rules,  supported  by  one  or  more 
institutional  units,  governing  the  provision  of  social  protection  benefits  and 
their financing. 

“Social protection benefits”: transfers, in cash or in kind, by social protection 
schemes  to  households  and  individuals  to  relieve  them  of  the  burden  of  the 
defined set of risks or needs. 

Article 3 

Scope of the system 

1. 

The statistics relating to the ESSPROS core system shall cover the financial flows on 
social protection expenditure and receipts. 

These data shall be transmitted at social protection schemes level; for each scheme, 
detailed  expenditure  and  receipts  shall  be  provided  following  the  ESSPROS 
classification. 

The  data  to  be  transmitted  in  reference  to  aggregated  classification,  data  provision 
and  dissemination  for  quantitative  information  as  well  as  the  subject  covered, 
updating  and  dissemination  of  qualitative  information  by  schemes  and  detailed 
benefits are laid down in Annex I. 

2. 

In  addition  to  the  core  system,  modules  covering  supplementary  statistical 
information on particular aspects of social protection shall be added. 

Article 4 

Module on pension beneficiaries 

A  module  on  pension  beneficiaries  shall  be  added  annually  from  the  first  year  of  data 
collection under this Regulation.  

The subjects to be covered, data provision and dissemination are laid down in Annex II. 

Article 5 

Additional modules 

1. 

2. 

For the purposes of a module on Net Social Protection Benefits, pilot data collections 
for the year 2005 shall be carried out in all Member States by the end of 2008. The 
subjects to be covered, data provision and dissemination are laid down in Annex III. 

Based on a synthesis of these national pilot data collections, the decision to introduce 
this module and to launch full data collection not before 2010 shall be in accordance 
with the procedure set out in Article 8. 

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Article 6 

Data sources 

The statistics shall be based on the following data sources, according to their availability in 
the Member States and in accordance with national laws and practices: 

(a) 

registers and other administrative sources; 

(b) 

surveys; 

(c) 

estimates. 

Article 7 

Arrangements for implementation 

The arrangements for implementing this Regulation, concerning the detailed classification of 
data covered, the definitions to be used, the formats for the transmission of data, the results to 
be  transmitted,  the  criteria  for  the  measurement  of  quality,  the  updating  of  the  rules  for 
dissemination  shall  be  laid  down  in  accordance  with  the  regulatory  procedure  set  out  in 
Article 8, in particular for: 

(a) 

the ESSPROS core system, 

(b) 

the module on pension beneficiaries, 

(c) 

the module on Net Social Protection Benefits. 

Article 8 

Procedure 

1. 

2. 

3. 

The  Commission  shall  be  assisted  by  the  Statistical  Programme  Committee  (SPC) 
established by Decision 89/382/EEC, Euratom. 

Where  reference  is  made  to  this  paragraph,  Articles  5  and  7  of  Decision 
1999/468/EC shall apply, having regard to the provisions of Article 8 thereof. 

The period laid down in Article 5 (6) of Decision 1999/468/EC shall be set at three 
months. 

Article 9 

Entry into force 

This Regulation shall enter into force on the 20th day following that of its publication in the 
Official Journal of the European Union. 

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This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels,  

For the European Parliament 
The President 

For the Council 
The President 

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ANNEX I 

ESSPROS core system 

1. 

Quantitative data 

1.1. 

Data transmitted 

With reference to aggregated classification, transmitted data shall cover: 

1.1.1.  Expenditure 

1.1.1.1.  Social protection benefits classified by: 

(a) 

functions (corresponding to each risk or need), and 

(b) 

for  each  function  by  dual  breakdown:  means-tested  versus  non-means-tested, 
cash  benefits  (breakdown  by  periodic  and  lump  sum  benefits)  versus  benefits 
in kind. 

1.1.1.2.  Administration costs 

1.1.1.3.  Transfers to other schemes 

1.1.1.4.  Other expenditure 

1.1.2.  Receipts 

1.1.2.1.  Social contributions 

1.1.2.2.  General government contributions 

1.1.2.3.  Transfers from other schemes 

1.1.2.4.  Other receipts 

Data covered (in reference to detailed classification) will be provided in accordance with the 
procedure laid down in Article 8. 

1.2. 

Data provision 

Statistics will be provided annually. Data will refer to the calendar year according to national 
practices. The deadline for data transmission is N+18 months, i.e. data for the calendar year N 
together with any revision of previous years have to be transmitted in June N+2 at the latest. 

1.3. 

Dissemination 

The Commission (Eurostat) will publish data on social protection expenditure at total schemes 
level by the end of N+22 months (October of the year N+2) based on the data referring to the 
financial year N. The Commission (Eurostat) will at the same time disseminate detailed data 
by  schemes  to  specific  users  (national  institutions  compiling  ESSPROS  data,  Commission 

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departments  and  international  institutions).  These  specific  users  will  only  be  allowed  to 
publish groups of schemes. 

2. 

Qualitative information by schemes and detailed benefits 

2.1. 

Subjects covered 

For  each  scheme,  qualitative  information  includes  a  general  description  of  the  scheme,  a 
detailed description of the benefits and information on recent changes and reforms. 

2.2. 

Data provision and updating of qualitative information 

Annual updating of a complete set of qualitative information already provided shall be limited 
to changes in the social protection system and shall be transmitted together with quantitative 
data. 

2.3. 

Dissemination 

The  Commission  (Eurostat)  will  disseminate  qualitative  information  at  scheme  level  by  the 
end of N+22 months (October of the year N+2). 

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ANNEX II 

Module on Pension Beneficiaries 

1. 

Subjects covered 

This  module  covers  data  on  pension  beneficiaries,  who  are  defined  as  recipients  of  one  or 
more of the following periodic cash benefits of a social protection scheme: 

(a) 

Disability pension 

(b) 

Early retirement benefit due to reduced capacity to work 

(c) 

Old-age pension 

(d) 

Anticipated old-age pension 

(e) 

Partial pension 

(f) 

Survivor's pension 

(g) 

Early retirement benefit due to labour market reasons. 

2. 

Data provision 

Statistics will be provided annually. Data shall be stock data referring to the end of the year 
(31.12./1.1). The deadline for data transmission of the year N is the end of May of year N+2, 
broken down as follows: 

(a) 

by social protection scheme, 

(b) 

by gender for the total of schemes, 

(c) 

by  type  of  management  of  the  scheme  (subject  to  positive  feasibility  study 
results). 

3. 

Dissemination 

The  Commission  (Eurostat)  shall  publish  data  for  all  schemes  by  the  end  of  N+22  months 
(October  of  the  year  N+2)  based  on  the  data  referring  to  the  financial  year  N.  The 
Commission (Eurostat) shall at the same time disseminate detailed data by schemes to specific 
users  (national  institutions  compiling  ESSPROS  data,  Commission  departments  and 
international  institutions).  These  specific  users  shall  only  be  allowed  to  publish  groups  of 
schemes. 

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ANNEX III 

Pilot data collection on Net social protection benefits 

1. 

Subjects covered 

This collection covers the calculation of “Net social protection benefits”. Net social protection 
benefits  are  defined  as  the  value  of  social  protection  benefits  excluding  taxes  and  social 
contributions paid by the benefits recipients complemented by the value of “Fiscal benefits”. 

“Fiscal benefits” are defined as social protection provided in the form of tax breaks that would 
be defined as social protection benefits if they were provided in cash. Tax breaks promoting 
the provision of social protection or promoting private insurance plans are excluded. 

2. 

Data provision 

The  appropriate  fraction  of  personal  income  tax  and  social  contributions  levied  on  social 
protection benefits for the year 2005 must be indicated according to the different types of cash 
social  protection  benefits,  preferably  further  subdivided  for  particular  groups  of 
homogenously  taxed  schemes.  In  difficult  cases,  results  might  be  reported  by  appropriate 
groups of benefits, e.g. the total of the seven pension categories listed in Annex II or the total 
of  the  cash  benefits  of  a  specific  function.  Fiscal  benefits  should  be  provided  for  each  item 
separately using the revenue forgone method. 

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