COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Towards robust quality management for European Statistics
Date: 2011-04-15
Institutions: European Commission
Subjects: EU statistics, Eurostat, economic policy, public accounting, tax system

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EUROPEAN COMMISSION 

Brussels, 15.4.2011 
COM(2011) 211 final 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL  

Towards robust quality management for European Statistics  

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COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL 

Towards robust quality management1 for European Statistics 

1. 

INTRODUCTION 

The aim of this Communication is to set out a strategy that would give the European 
Union a quality management framework for statistics related to enhanced economic 
policy  coordination  which  includes  mechanisms  to  ensure  the  high  quality  of 
statistical indicators. 

In  the  specific  context  of  the  EU  fiscal  surveillance  system  and  of  the  excessive 
deficit procedure (EDP) exercise, the Commission has been entrusted with the task of 
regularly assessing the quality both of actual data reported by Member States and of 
the  underlying  government  sector  accounts  compiled  according  to  the  European 
System of Accounts. Recent developments, in particular, the inaccuracy of the Greek 
government  deficit and debt statistics,2 have however demonstrated that  the  system 
for  fiscal  statistics  did  not  sufficiently  mitigate  the  risk  of  substandard  quality  data 
being notified to Eurostat. To address this issue, the Commission expressed the need 
to grant Eurostat extended powers in the field of fiscal statistics. These powers were 
granted by the Council in August 2010. 

Furthermore, the impact of the economic and financial crisis highlighted the need to 
strengthen  the  economic  governance  structure  for  the  Euro  area  and  the  European 
Union as a  whole.  The  Commission  reacted, on 29 September  2010, by adopting a 
package of legislative proposals.3 This seeks to extend and improve the surveillance 
of  fiscal  policies,  macroeconomic  policies  and  structural  reforms  to  remedy  the 
shortcomings  found  in  existing  legislation.  New  enforcement  mechanisms  are 
planned  in  the  event  of  non-compliance  by  Member  States.  It  is  clear  that  these 
mechanisms must rely on high quality statistical information, produced under robust 
quality management. 

It  is  also  expected  that  all  statistical  domains  will  benefit  from  enhanced  quality 
management.  In  particular,  the  Europe  2020  strategy  for  growth  and  jobs  and  the 
reinforced  economic  governance,  including  through  the  European  Semester  of  ex-
ante  coordination  of  economic  policies  in  the  European  Union,  will  require  sound, 

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As  in  other  organisations,  the  requirements  for  quality  in  the  European  Statistical  System  have  been 
standardised.  Quality  management  is  understood  as  a  formal  approach  by  statistical  authorities  to 
implementing  the  principles  and  indicators  of  the  European  Statistics  Code  of  Practice  through 
appropriate  procedures  and  tools.  It  refers  to  a  formalised  system  that  documents  the  structure, 
responsibilities and procedures put in place for satisfying users, while continuing to improve the data 
production and dissemination processes. 

Report  by  the Commission  of  8  January  2010 on Greek government  deficit  and  debt  statistics  (COM 
(2010)1 final. 

COM (2010) 522 to 527. 

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high quality data and statistical analysis, on which decisions can be based and their 
implementation monitored, to be successful. 

2. 

THE EXISTING QUALITY FRAMEWORK IN EUROPEAN STATISTICS 

Statistical  information  is  the  product  resulting  from  statistical  production  processes 
operating  across  the  entire  European  Statistical  System  (ESS).  Users  of  European 
statistics should be able to confidently use this information as an input to their own 
decision-making. These products should be fit for purpose. It is essential that users 
consider  statistics  to  be  relevant,  timely  and  accurate,  and  produced  in  compliance 
with principles of official  statistics, such  as  professional independence, impartiality 
and  objectivity.  This  applies  to  the  European  Statistical  System4  as  a  whole, 
including Eurostat. 

The  overall  quality  of  statistical  information  at  European  level  is  highly  dependent 
on  the  appropriateness  of  the  entire  production  process  used  to  generate  these 
statistics.  If  data  provided  by  Member  States  are  of  insufficient  quality,  it  has  a 
negative impact on the quality of European statistics. To help prevent such situations 
from  arising,  comprehensive  and  robust  ESS  quality  management  is  needed.  This 
systemic approach to quality will benefit from the reform of the production method 
of European statistics, as it is expected to streamline the entire production chain.5 

In  recent  years,  governance  of  the  ESS  has  been  improved,  in  particular  with  the 
adoption  of  a  European  Statistics  Code  of  Practice  in  2005.6  Implementation  and 
monitoring  of  the  Code  relied  to  a  large  extent  on  a  self-regulatory  approach  (self-
assessments, peer-reviews and national implementation plans). Since 2009, when the 
European  Statistical  Governance  Advisory  Board  (ESGAB)  was  established,  the 
system was boosted by the addition of an external assessment and then by the entry 
into force of Regulation (EC) No 223/2009 on European statistics.7 

European  Government  Finance  Statistics  are  produced  in  accordance  with  the 
European  System  of  Accounts  (currently  ESA  95),  and  form  the  basis  for  fiscal 
monitoring in the EU, especially for statistics related to EDP. European Government 
Finance  Statistics  differ  from  the  budget  or  public  accounting  presentations,  which 
are nationally specific in terms of their scope of entities and principles for recording 
transactions.  At  national  level,  national  statistical  authorities  are  responsible  for 
ensuring  that  reported  data  complies  with  legal  provisions.  At  European  level, 
Eurostat  is  responsible  for  providing  the  statistical  methodological  basis  on  which 
EDP statistics are compiled, and for assessing the quality of actual data reported by 
Member States for EDP purposes. 

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The adoption of Regulation (EC) No 223/2009, which came into force on 1 April 2009, strengthened 
the legal foundations of the ESS and modernised, together with the creation of the ESGAB (European 
Statistical Governance Advisory Board) and the ESAC (European Statistical Advisory Committee), the 
ESS governance structure. 

Communication from the Commission of 18 August 2009 to the European Parliament and the Council 
on the production method of EU statistics: a vision for the next decade — COM (2009) 404 final. 

Recommendation of the Commission of 25 May 2005 on the independence, integrity and accountability 
of national and community statistical authorities. COM (2005) 217 final. 

JO L 87, 31.3.2009, p. 164. 

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Following the weaknesses identified in Greek government deficit and debt statistics,8 
the  Commission  was  granted  extended  powers,  allowing  for  an  in-depth  review  of 
upstream  EDP  data  sources.  These  powers  were  immediately  applied  for  assessing 
the quality of Greek government deficit and debt statistics. 

3. 

WHY FURTHER REINFORCEMENT IS NEEDED 

In the context of the recent financial crisis, the weaknesses in the quality of upstream 
public  accounting  data  and  their  statistical  integration  within  the  EDP  reporting 
process  were  compounded  by  weaknesses  in  the  current  statistical  governance 
arrangements.  The  lessons  learnt  also  concern  the  credibility  of  national  statistical 
systems, and of the European Statistical System as a whole. More specifically, there 
is a clear case for reinforcing the legal framework in place regarding the professional 
independence  of  ESS  members,  and  for  progressively  moving  from  a  mainly 
corrective approach to a preventive approach to the quality management of European 
statistics in general and public finance statistics in particular. 

This  Communication  builds  on  the  existing  framework  which  lays  the  foundations 
for a governance framework for the production of European statistics. Its aim is first 
to  address  the  weaknesses  which  have  become  apparent  from  experience  gained  in 
recent years and second to raise the quality of European statistics, taking a priority 
and  risk-based  approach  that  builds  on  existing  quality  management  systems  in 
Member States. It also takes into the account statistical implications of the legislative 
proposals adopted by the Commission on 29 September 2010, on: 

•  Strengthening the Stability and Growth Pact with prudent fiscal policy making; 

•  Preventing and correcting macroeconomic imbalances; 

•  Establishing  national  fiscal  frameworks  of  quality,  and  in  particular  the  need  to 
put in place public accounting systems, subject to appropriate internal control and 
audit  mechanisms,  comprehensively  and  consistently  covering  all  sub-sectors  of 
general government; 

•  Stronger enforcement.9 

This  Communication  echoes  the  conclusions  of  the  Task  Force  Van  Rompuy10 
Report  of  21  October  2010  and  the  conclusions  of  the  Economic  and  Financial 
Affairs Council of 17 November 2010.11 It notably addresses the issue of reinforcing 
the  implementation  of  the  Code  of  Practice  by  Member  States.  Implementing  this 
ambitious  strategy  will  also  require  a  careful  review  of  statistical  priorities  and 
resources allocated to ESS members. 

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Report  by  the  Commission  of  8  January  2010  on  Greek  government  deficit  and  debt  statistics  —  
COM (2010)1 final. 
http://ec.europa.eu/economy_finance/articles/eu_economic_situation/2010-09-
eu_economic_governance_proposals_en.htm  
http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/117236.pdf  

http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/117762.pdf  

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4. 

THE WAY FORWARD 

In  order  to  develop  and  implement  a  quality  management  framework,  the 
Commission will pursue the following two lines of action. 

4.1. 

First  action  line:  Further  strengthening  the  governance  of  the  European 
Statistical System 

Reinforcing the implementation of the European Statistics Code of Practice 

The  Commission  intends  to  improve  implementation  of  the  governance  framework 
for  statistics,  by  proposing  amendments  to  Regulation  (EC)  No  223/2009  on 
European Statistics, a revised European Statistics Code of Practice and a new process 
for  the  implementation  of  this  Code  by  National  Statistical  Institutes  and  other 
relevant National Authorities, notably: 

(1) 

(2) 

(3) 

A proposal on targeted amendments to Regulation (EC) No 223/2009 will be 
tabled.  It  will  make  clear  that  the  principle  of  professional  independence  of 
National  Statistical  Institutes  applies  unconditionally.  Statistics  must  indeed 
be developed, produced and disseminated in an independent manner free from 
any  pressures  from  political  or  interest  groups  or  from  Union  or  national 
authorities and existing institutional settings cannot restrict this principle. The 
mandate of statistical authorities for data collection when data are extractable 
from available administrative records will be enhanced by clarifying their role 
in  the  design  of  the  content  of  administrative  records  and  the  quality 
requirements  applicable  to  administrative  data.  Where  appropriate,  this 
amendment of Regulation (EC) No 223/2009 will also set a legal framework 
for  other  initiatives,  in  particular  implementation  of  the  new  ‘Commitments 
on  Confidence  in  Statistics’,  allowing  for  a  stronger  Code  of  Practice 
implementation framework. 

The Code of Practice will be revised to distinguish between principles to be 
implemented  by  ESS  members  and  principles,  relating  to  the  institutional 
environment,  to  be  implemented  by  Member  State  governments.  The 
Commission Recommendation of 25 May 2005 will subsequently be updated. 

The  Commission  proposes  that  Member  States  should  formally  commit 
themselves, based on the Code of Practice, to taking all necessary measures to 
maintain  confidence  in  their  statistics  and  to  monitoring  the  implementation 
of  the  Code  (‘Commitment  on  Confidence  in  Statistics’).  The  Commission 
will draft an agreed core of basic principles of ‘Commitments on Confidence 
in Statistics’ in cooperation with Member States with a view to incorporating 
it  in  Regulation  (EC)  No  223/2009.  The  detailed  contents  of  each 
commitment  will  be  elaborated  with  the  respective  Member  States  on  the 
basis  of  the  following  general  components,  in  order  to  achieve  proper 
implementation of the Code of Practice at national level: 

– 

Each  Member  State  would  define  its  own  quality  assurance  and 
improvement  programme,  reflecting  its  progress  in  implementing  the 
Code  and  identifying  priority  actions  needed  to  ensure  proper 
implementation  of  the  minimum  standards.  This  programme  would  be 
updated as appropriate to accommodate newly identified needs; 

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– 

– 

On  a  regular  basis,  and  coordinated  by  each  National  Statistical 
Institute,  each  Member  State  would  conduct  a  self  assessment  of  the 
implementation  of  the  Code,  covering  the  entire  National  Statistical 
System. Weaknesses identified and lessons learned would feed into the 
quality  assurance  and  improvement  programme.  Critical  weaknesses 
should be remedied without undue delay; 

Building  on  these  ‘Commitments  on  Confidence  in  Statistics’,  and  in 
particular on national quality assurance and improvement programmes 
and national self assessments, the Commission would then develop and 
organise  its  own  programme  to  assess  implementation  of  the  Code  of 
Practice by National Statistical Authorities.  

These  minimum  standards  apply  to  all  statistical  domains.  There  would  also  be 
specific  requirements  for  the  statistical  domains  that  underpin  enhanced  economic 
policy coordination, as specified further below. 

The Role of the European Statistical Governance Advisory Board (ESGAB) 

The purpose of this Board is to provide independent supervision of Eurostat and of 
the  European  Statistical  System  as  a  whole  as  regards  implementation  of  the 
European Statistics Code of Practice. Having assessed the role and effectiveness of 
ESGAB,  the  Commission  looks  forward  to  continuing  its  cooperation  with  this 
Board,  from  which  it  has  benefited  since  it  was  set  up  in  2009.  The  Commission 
expects  ESGAB  to  benefit  from  reinforced  implementation  and  monitoring  of  the 
Code of Practice. 

In  line  with  the  Decision  establishing  ESGAB,  the  Commission  will  take  stock  of 
experience and make further proposals on the functioning of this Board, if need be. It 
will  also  seek  the  advice  of  the  Board  on  proposals  to  update  the  Code  of  Practice 
and on ways to facilitate its implementation.  

Eurostat’s institutional environment as regards the production of European statistics 

The  institutional  setting  of  Eurostat  and  the  way  it  operates  within  the  European 
Commission  is  defined  by  Commission  Decision  97/281/EC.12  Eurostat  fulfils  its 
coordination  role  as  set  out  in  Regulation  (EC)  No  223/2009.  Its  professional 
independence as well as the entire process of implementing the Code of Practice is 
supervised  by  ESGAB.  Eurostat  also  maintains  a  permanent  dialogue  with  users 
through  the  interface  of  the  European  Statistical  Advisory  Committee.13  This  gives 
Eurostat the framework it needs to play a strong and independent role in this current 
setting. It is thus envisaged to align Decision 97/281/EC with the current framework 
already implemented. 

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Commission Decision 97/281/EC of 21 April 1997 on the role of Eurostat as regards the production of 
Community statistics. OJ L 112, 29.4.1997, p. 56. 
Decision  No  234/2008/EC  of  the  European  Parliament  and  of  the  Council  of  11  March  2008 
establishing the European Statistical Advisory Committee (ESAC). JO L 73, 15.3.2008, p. 13. 

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4.2. 

Second action line: Preventive approach to verifying government finance (EDP) 
statistics 

EDP  statistics  are  the  result  of  re-compiling  primary  public  finance  data,  herein 
referred to as ‘upstream data’. Recent experience has shown that it is as important to 
assess  the  quality  of  upstream  data  as  it  is  to  continue  assessing  the  quality  of  the 
translation of this data into ESA standards. Preventive measures, such as promoting 
further standardisation in public accounts, and a wider proactive management of risk 
assessment are needed, including assessing the adequacy of the quality of upstream 
data  for  compiling  statistics  in  accordance  with  ESA  rules.  Corrective  actions  will 
however  remain  as  a  necessary  tool  in  parallel.  Eventually,  once  it  is  assured  that 
preventive measures are effective, the need for these corrective actions will be more 
limited. 

Positive  benefits  are  expected  from  reinforcing  the  governance  of  the  European 
Statistical System 

Taking  a  preventive  approach  to  the  verification  of  government  finance  statistics 
means  that  ‘Commitments  on  Confidence  in  Statistics’  are  designed  to  cover  the 
risks related to an inadequate design of National Statistical Systems as a whole. The 
following arrangements are also important: a clear mission statement (and ethical and 
organisational  values  known  by  the  staff),  proper  management  supervision  and 
segregation of duties, an internal audit capacity or similar entity and an appropriate 
risk  management  process,  including  IT  aspects.  Substantial  changes  to  those 
arrangements  should  be  properly  analysed  to  evaluate  their  impact  on  the  risks 
associated to public finance statistics processes. 

Specific measures are also needed 

In  addition  to  the  need  to  mitigate  these  risks  of  a  general  nature,  Eurostat  will 
develop  a  specific  quality  management  system  for  public  finance  statistics  in 
cooperation  with  the  National  Statistical  Institutes  and  the  national  bodies 
responsible for verifying upstream public finance data (in particular National Courts 
of Auditors). 

The  aims  of  a  quality  management  approach  to  public  finance  statistics  will  be 
achieved  primarily  by  introducing  improved  quality  assurance  systems  within  the 
ESS  and  close  monitoring  by  Eurostat  through  systematic  risk  analysis  and  regular 
EDP  dialogue  visits.  The  recent  revision  of  Regulation  (EU)  No  479/200914  grants 
Eurostat  powers  to  operate  a  system  of  regular  monitoring  and  verification  of 
upstream  public  finance  data,  for  all  Member  States,  designed  to  significantly 
increase the quality of risk identification. The Commission will exercise in full these 
new competences by conducting more intense dialogue visits and by extending them 
to public entities supplying upstream public finance data to the NSIs.  

This  approach  will  facilitate  a  principled,  systematic  and  consistent  framework  for 
organising  methodological  visits.  If  the  Commission  deems  it  appropriate  then,  as 

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As  resulting  from  Council  Regulation  (EU)  No 679/2010  of  26 July  2010  amending  Regulation  (EC) 
No 479/2009 as regards the quality of statistical data in the context of the excessive deficit procedure 
(OJ L 198, 30.7.2010, p.1). 

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foreseen  in  the  new  Article  11b  of  Regulation  (EC)  No  479/2009,  more  in-depth, 
methodological  visits  to  the  Member  States  concerned  will  be  made  at  the  earliest 
possible moment. 

In  this  context,  Eurostat  will  translate  its  recent  experience  into  a  structured 
preventive  system  applicable  to  all  Member  States.  The  threefold  objective,  in 
cooperation  with  NSIs,  is  to  better  identify,  assess  and  monitor  significant  risks  or 
problems in a proactive manner with a view to taking corrective action at the earliest 
possible point. To achieve this, the entire statistical production chain requires to be 
covered — from the sources of upstream accounting data up to final notification of 
EDP  data  reported  by  NSIs.  Eurostat  will  introduce  a  harmonised  and  robust 
approach to quality management for EDP purposes, taking into account the relevant 
risk factors in its risk assessment model. 

This new approach will focus on: 

•  The  appropriateness  of  upstream  public  finance  data  to  comply  with  the 

requirements of ESA-based accounts; 

•  Their  exhaustiveness,  in  terms  of  coverage  of  the  general  government,  with 

special attention to state and local sub-sectors and supervised entities; 

•  Their  timeliness  and  consistency  in  time,  including  quarterly  data,  which  is 

increasingly becoming a priority for users; 

•  The  effectiveness,  reliability,  integrity  and  transparency  of  the  process  of  data 
flows between public entities and the statistical authorities in charge of the final 
compilation of EDP data. It will cover an analysis of arrangements regarding the 
responsibility  of  national  officials  and  staff  involved  in  these  workflows,  the 
verification  of  accounting  data  by  Member  States  at  all  levels  of  general 
government,  as  well  as  robust  and  effective  supervisory  and  control  systems  at 
national level. For instance, a set of quality management standards tailored to the 
specificities  of  the  EDP  compilation  process  could  be  agreed,  implemented  by 
NSIs and certified by the Commission; 

•  The completeness and accuracy of the registry of entities controlled by units of the 
general  government,  and  thus  potentially  candidates  to  be  classified  inside  the 
general government; 

•  Implementation of the European Statistics Code of Practice in the context of the 

process of EDP compilation 

This approach aims to minimise additional costs for all actors in the system as it will 
be  based  on  a  risk  assessment,  which  reasonably  balances  efforts  with  prevention, 
detection and mitigation of risks of insufficient quality of EDP data.  

Moreover,  in  line  with  its  proposal  for  a  Council  Directive  on  requirements  for 
budgetary  frameworks  of  the  Member  States,15  the  Commission  will  support  the 
implementation of public accounting standards providing the information needed to 

15 

COM (2010) 523 final. 

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compile  ESA-based  data  for  all  sub-sectors  of  general  government.  This  project 
encompasses  the  elements  needed  to  build  quarterly  general  government  sector 
accounts and bridge tables between monthly cash-based reports and ESA-consistent 
quarterly  data.  Eurostat  intends  to  play  an  active  role  within  the  framework  of  the 
International  Public  Sector  Accounting  Standards,  which  promote  accrual-based 
public accounting close to ESA-based principles. 

A  more  rigorous  enforcement  policy  will  supplement  this  new  approach  and 
infringement procedures will be systematically initiated in the event that a Member 
State  has  clearly  falsified  fiscal  data  or  provided  misleading 
information. 
Enforcement  rules  will  also  be  envisaged  in  the  context  of  the  Commitments  on 
Confidence in Statistics. 

To  monitor  and  control  a  more  harmonised  system,  Eurostat  will  continue  to  build 
and  maintain  durable  relationships  with  and  across  Member  States.  Eurostat  will 
create a group of officials from National Statistical Institutes dedicated to: 

•  implementing  Article  16  of  Regulation  (EC)  No  479/2009  across  the  EU, 
regarding the responsibilities of national authorities and officials in the context of 
EDP, with Eurostat’s involvement to work towards a harmonised EU framework; 

•  harmonised  improvements  of  the  quality  management  framework  concerning 
government  finance  statistics,  particularly  the  development  of  a  common  early 
warning system to identify, assess and monitor risks. 

The  recently  revised  legal  framework  of  Regulation  (EC)  No  479/2009  allows 
Eurostat to deploy a system of regular monitoring and verification of upstream public 
finance  data,  shared  by  all  Member  States,  designed  to  significantly  increase  the 
quality of risk identification (and subsequent assessment and monitoring). However, 
should the current legal basis prove insufficient to encapsulate all these aspects, the 
Commission will take the appropriate legislative initiatives. 

5. 

NEXT STEPS 

The  Commission  will  pursue  the  strategy  presented  in  this  Communication,  taking 
into  account  resource  constraints,  in  line  with  its  responsibilities  under  the  Treaty. 
This  strategy  consists  of  a  balanced  approach  that  builds  upon  the  existing 
achievements and ensures that the ESS can operate at arm’s length but still in close 
relationship with its main data providers and institutional users. It is also important to 
underline  that  this  new  approach  in  statistical  quality  management  will  not  lead  to 
further bureaucratic requirements, increased  administrative burdens on respondents, 
or to delays in the statistical production. 

Given  the  different  issues  at  stake,  it  is  important  to  make  swift  progress  while 
consulting key stakeholders, including where legislative initiatives are needed, i.e.: 

(1) 

Amending Regulation (EC) No 223/2009 to strengthen the provisions related 
to  the  independence  of  ESS  members,  to  require  an  active  role  of  NSIs  in 
defining the quality requirements of administrative data sources, and to set up 
a 
the  new 
Commitments on Confidence in Statistics; 

legal  framework  for 

implementation  of 

the  design  and 

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(2) 

Revising  the  European  Statistics  Code  of  Practice  to  distinguish  between 
principles to be implemented by ESS members and principles, relating to the 
institutional environment, to be implemented by Member States’ governments 
and eventually amending Commission Recommendation of 25 May 2005; 

(3) 

Amending Decision 97/281/EC on Eurostat’s institutional role to align it with 
the current governance framework already implemented. 

The Commission will also address new needs for statistical information, in particular 
those  arising  from  the  adoption  of  the  package  on  Economic  Governance,  as 
proposed  by  the  Commission  on  29  September  2010.  The  Commission  will  take 
further  initiatives  if  the  need  for  more  robust  quality  management  in  those  areas 
arises, in addition to the usual quality requirements applicable to official statistics. 

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