Government finance statistics guide.
Date: 2020-06-08
Institutions: European Central Bank
Subjects: EU budget, European Central Bank, European Development Fund, European currency, banking policy, euro area, financial statistics, government, loss, public debt, public finance, stability pact, user guide

Government finance 
statistics guide 

January 2019 

 
 
 
 
 
 
 
Contents 

1 

1.1 

Introduction 

Latest update of the guide 

1.2  Context and purpose 

1.3  Methodological framework 

1.4  ECB publications and other uses of GFS 

1.5  Structure of the guide 

2 

2.1 

2.2 

2.3 

3 

3.1 

3.2 

3.3 

4 

4.1 

4.2 

4.3 

5 

5.1 

5.2 

5.3 

Government revenue, expenditure and deficit/surplus (Table 1a) 

Introduction to Table 1a 

Table 1a: format and contents 

Line-by-line analysis of Table 1a 

Transactions with EU budget and the European Development Fund 
(EDF) (Table 1b) 

Introduction to Table 1b 

Table 1b: format and contents 

Line-by-line analysis of Table 1b 

Government consumption expenditure and other non-financial 
categories (Table 1c) 

Introduction to Table 1c 

Table 1c: Format and contents 

Line-by-line analysis of Table 1c 

Government deficit-debt adjustment (Table 2a) 

Introduction to Table 2a 

Table 2a: Format and contents 

Line-by-line analysis of Table 2a 

Breakdown by instrument 

Breakdown by instrument 

Breakdown by currency 

Government finance statistics guide 

3 

3 

3 

4 

6 

7 

9 

9 

10 

11 

23 

23 

23 

24 

29 

29 

30 

31 

35 

35 

38 

40 

41 

46 

50 

1 

 
 
6 

6.1 

6.2 

6.3 

Government Debt (Table 3a) 

Introduction to Table 3a 

Table 3a: Format and contents 

Line-by-line analysis of Table 3a 

Breakdown by instrument 

Breakdown by holder/creditor 

Currency denomination 

Maturity of Maastricht debt 

Breakdown of Maastricht debt by residual maturity 

7 

7.1 

7.2 

7.3 

8 

Government debt – consolidating elements (Table 3b) 

Introduction to Table 3b 

Table 3b: Format and contents 

Line-by-line analysis of Table 3b 

Compilation of aggregates for the euro area and the European 
Union 

8.1  Aggregation method 

8.2  Consolidation of national data 

8.3 

9 

Treatment of the European Union budget and the EDF 

References and background information 

9.1 

Legal background 

9.2  Other published guidance and manuals 

9.3  EDP notification tables 

9.4 

IMF government finance statistics 

57 

57 

60 

61 

61 

63 

66 

67 

68 

72 

72 

73 

74 

77 

77 

77 

78 

80 

80 

80 

81 

82 

Government finance statistics guide 

2 

 
 
 
1 

Introduction 

This chapter explains the changes made to the Guide compared to the version of 
August 2014, how government finance statistics (GFS) are used at the European 
Central Bank (ECB) and also gives a brief overview of the methodological framework 
for GFS. 

The Guide complements the latest GFS Guideline adopted by the ECB in 20181, 
which sets out the ECB’s statistical reporting requirements in the field of GFS. The 
Guide explains how the annual GFS data required by the GFS Guideline are compiled. 
The Guide is for use by staff in the national central banks (NCBs), national statistical 
institutes (NSIs) and other institutions engaged in preparing data for GFS returns, and 
for users requiring a better understanding of GFS. 

1.1 

Latest update of the guide 

The alignment to the latest update of GFS Guideline in 2018 necessitated the changes 
to this Guide. Compared to the previous version of the Guide published in 
August 2014, the changes to GFS Tables 1a (Chapter 2), 1b (Chapter 3), 1c 
(Chapter 4) and Table 2a (Chapter 5) were done to achieve a greater consistency 
across euro area Member States and across datasets and incorporate further 
alignment of the current statistical requirements in the field of GFS with the European 
System of Accounts 2010 (ESA 2010) 2  Transmission Programme. In addition, the 
previous Table 2b on non-consolidated transactions in Maastricht debt has been 
deleted while Table 3b on consolidating elements of Maastricht debt has been 
expanded with more detailed data. Finally, Table 1b on transactions with the EU 
budget and European Development Fund (EDF) now includes a new separate section 
devoted to transactions vis-à-vis the Single Resolution Board/Single Resolution Fund. 

1.2 

Context and purpose 

The ECB is interested in GFS for several reasons. It uses these in its monetary policy 
analysis, as government activity may influence the general price level. Moreover, the 
ECB, like the European Commission, prepares periodic “convergence” reports 
assessing the preparedness of non-participating Member States to adopt the euro; 
annual data on government deficits and outstanding government debt are important 
criteria here. The ECB also closely follows developments under the EU’s excessive 
deficit procedure (EDP) and the Stability and Growth Pact. 

1    Guideline of the ECB of 25 July 2013 on government finance statistics (ECB/2013/23) as amended by 

the GFS Guideline of 3 June 2014 (ECB/2014/21) and the GFS Guideline of 24 April 2018 
(ECB/2018/13). 

2    Regulation No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European 

system of national and regional accounts in the European Union. 

Government finance statistics guide 

3 

 
 
                                                                    
The Governing Council of the ECB therefore attaches great importance to the reliable 
and timely compilation of GFS. It adopted the first guideline on the statistical reporting 
requirements in the field of GFS in 2005 to ensure the timely transmission of 
government statistics from the NCBs to the ECB. The original Guideline has since 
been repealed by the Guideline of the ECB of 25 July 2013 on government finance 
statistics (ECB/2013/23) and amended by the GFS Guideline of 3 June 2014 
(ECB/2014/21) and the GFS Guideline of 24 April 2018 (ECB/2018/13). 

The GFS Guideline imposes obligations on the ECB and the euro area NCBs, but 
does not bind the central banks of non-participating Member States. However, the 
information contained in this Guide is nevertheless relevant to them, as they also 
report GFS to the ECB. 

1.3 

Methodological framework 

The GFS Guideline specifies the requested data on government revenue and 
expenditure, government deficit and debt, the relationship between deficit and debt, 
and transactions between the EU institutions and general government or other 
resident sectors of the economy. The Guideline also lays down when and how these 
data should be reported to the ECB. The Guideline defines the requested data by 
reference to the ESA 20103  and the EDP.4 

European Union (EU) law requires Member States to use the ESA 2010 to prepare the 
macroeconomic statistics they send to the European Commission. This ensures that 
the national data are comparable. The ESA 2010 is based on the System of National 
Accounts 2008 (SNA 2008),5  a worldwide system developed by the Commission 
(Eurostat), the International Monetary Fund (IMF), the Organisation for Economic 
Co-operation and Development (OECD), the United Nations (UN) and the World Bank. 
The ESA 2010 is an integrated system of economic accounts from which many 
macroeconomic aggregates, such as gross domestic product, are derived. It 
organises the statistics on the output of an economy, the generation and distribution of 
income arising from that output, the accumulation of capital and of financial assets and 
liabilities, and balance sheets. 

The general government sector in the ESA 2010 is composed of central government, 
state government (in countries where it exists), local government and social security 
funds (in countries where these exist). The principal economic functions of the general 
government sector are: (1) to assume responsibility for the provision of goods and 
services to the community or individual households for free or at prices that are not 
economically significant and (2) to redistribute national income and wealth by means 
of transfer payments, financing both of these activities primarily from taxation. 

3    Regulation No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European 

system of national and regional accounts in the European Union. 

4    Council Regulation (EU) No 479/2009 as amended by Commission Regulation (EU) No 220/2014. 
5    Available on the United Nations website. 

Government finance statistics guide 

4 

 
 
                                                                    
GFS should reflect decisions taken by Eurostat on the interpretation of the ESA 2010 
in specific cases involving the general government sector. With the aim of ensuring a 
consistent compilation of government deficit and debt across EU countries, Eurostat 
has developed a well-defined procedure for dealing with borderline transactions. After 
discussions in expert Eurostat working parties and task forces, Eurostat may consult 
the Committee on Monetary, Financial and Balance of Payments Statistics (CMFB),6 
comprising senior statisticians of the ECB, Eurostat, the NCBs and national statistical 
institutes. Eurostat then takes the final decision on the transaction according to purely 
technical criteria, and this is subsequently applicable to similar cases arising 
throughout the EU. The main methodological decisions are discussed in more detail in 
the Manual on Government Deficit and Debt (MGDD). 7 

Total government revenue and expenditure are groupings of ESA 2010 non-financial 
transactions. Total government revenue consists, inter alia, of taxes and social 
contributions. Total government expenditure consists, inter alia, of compensation of 
government employees and government gross fixed capital formation. Chapter 2 
explains the components of government revenue and expenditure in more detail. The 
deficit/surplus (net lending/net borrowing in the ESA 2010) is equal to total revenue 
less total expenditure. 

Both the ESA 2010 and the EDP concern national data relating to the general 
government sector. They treat transactions between the EU institutions and 
institutional units in the Member States as transactions between resident sectors and 
the rest of the world. The GFS Guideline follows the ESA 2010 methodology, but 
specifies information on the transactions between Member States and the EU 
institutions financed by the EU budget and the European Development Fund (EDF), to 
capture the full extent of government activity in the EU. A detailed description of the 
EU budget and the EDF transactions is provided in Chapters 3 and 8. 

The substantial differences between general government liabilities in the ESA 2010 
balance sheet and government debt for EDP purposes are explained in Chapter 6. 
These differences can be summarised as follows: 

• 

• 

EDP debt comprises general government liabilities in the form of currency 
(coins), deposits, debt securities and loans only. All other general government 
liabilities, such as insurance technical reserves, other accounts payable (such as 
trade credits) and financial derivatives, are not included in Maastricht debt. 

The second difference arises from valuation. In the ESA 2010, general 
government liabilities are valued at market prices; in the EDP, they are entered at 
face value, which is the amount that the government is committed to repaying at 
maturity. The difference between market and face value can be large for zero 
coupon debt or for long-term coupon securities issued when coupon rates and 
market interest rates were different. Furthermore, the market price will reflect 
accrued interest on the instrument, whereas EDP debt at face value does not 

6    See the CMFB website. 
7    The MGDD is available in the government finance statistics section of the Eurostat website. 

Government finance statistics guide 

5 

 
 
                                                                    
include accrued interest (with the exception of zero coupon bonds and the capital 
uplift for index-linked bonds). 

• 

Third, the EDP values certain debt denominated in foreign currency in a different 
way. The ESA 2010 requires foreign currency debt to be converted into domestic 
currency at the spot market exchange rate on the balance sheet date. If the 
foreign currency liability is covered forward, the current market value of the 
foreign currency derivatives contract is entered in the balance sheet as a 
separate asset or liability of general government under financial derivatives. In 
the EDP, by contrast, the foreign currency liability is valued at the rate in the 
forward contract, not at the current spot market rate. A similar valuation 
procedure applies in the less likely case that debt denominated in domestic 
currency is converted into foreign currency debt. 

EDP debt is consolidated, meaning that general government debt for EDP purposes 
excludes all holdings of general government debt by general government. 
Consolidation is explained in more detail in Chapter 7. 

For the reasons set out, the reconciliation between the deficit/surplus and EDP 
government debt departs considerably from the reconciliation accounts in the 
ESA 2010 (i.e. other changes in the volume of assets (and liabilities) account and the 
revaluation account). The GFS Guideline requires information to enable the 
reconciliation between the deficit and debt (known as the deficit-debt adjustment 
(DDA). 

Outstanding government debt does not necessarily increase in line with the deficit, for 
several reasons. First, the deficit is different from the amount a government needs to 
borrow (the borrowing requirement) because of changes in the financial assets it 
holds. Second, there are differences in the time of recording, mainly between 
government expenditure or revenue and any related cash flow. Finally, the change in 
outstanding government debt may differ from the borrowing requirement owing to 
other changes in the value or volume of debt as recorded in the “other changes in 
assets (and liabilities) account”. Chapter 5 explains the DDA in more detail. 

1.4 

ECB publications and other uses of GFS 

The ECB requires two submissions each year of annual GFS (in April and October) 
and interim updates and revisions. These data deliveries are used to update the tables 
in the ECB’s Economic and Statistical Bulletins.8  The April and October data 
submissions are also used for internal purposes such as the June and December 
Fiscal Policy Notes, which contain statistics (up to year t-1) and fiscal forecasts (from 
year t to year t+2). Furthermore, the annual data transmitted by the NCBs of the 
non-participating Member States (excluding Denmark and the United Kingdom) are 
also used in the ECB’s Convergence Reports, which include tables with detailed 
breakdowns of government revenue and expenditure, the structural features of 
government debt and an analysis of the deficit-debt adjustment. 

8    Available on the ECB website. 

Government finance statistics guide 

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The ECB also publishes quarterly euro area aggregates of government revenue, 
expenditure, deficit, debt and the DDA in the ECB’s Economic and Statistical Bulletins. 
The provision of quarterly GFS is not covered by the GFS Guideline. Eurostat and the 
Member States kindly transmit these quarterly data to the ECB. The quarterly euro 
area aggregates of the financial accounts of the general government sector are used 
as a building block in compiling the integrated euro area accounts. 

The ECB also compiles statistics on the (residual) maturity, debt service and nominal 
yields on government debt securities from the Centralised Securities Database 
(CSDB). The CSDB contains very detailed and up-to-date information on a 
security-by-security basis.9 

1.5 

Structure of the guide 

The remainder of this Guide consists of chapters for each GFS reporting table and 
some additional methodological chapters: 

• 

• 

• 

• 

• 

• 

• 

• 

• 

Chapter 2 provides an introduction to government revenue, expenditure and 
deficit/surplus, and a line-by-line analysis of Reporting Table 1a. 

Chapter 3 provides an introduction to the EU budget and the EDF transactions, 
and a line-by-line analysis of Reporting Table 1b. 

Chapter 4 provides an introduction to government consumption expenditure and 
other non-financial categories, and a line-by-line analysis of Reporting Table 1c. 

Chapter 5 provides an introduction to the deficit-debt adjustment and a 
line-by-line analysis of Reporting Table 2a. 

Chapter 6 provides an introduction to government debt and a line-by-line 
analysis of Reporting Table 3a. 

Chapter 7 provides an introduction to the consolidation of government debt and a 
line-by-line analysis of Reporting Table 3b. 

Chapter 8 explains how euro area and EU aggregates are compiled. 

Chapter 9 compares the ECB’s GFS data request with that of the IMF and the 
EDP notification tables. 

Chapter 10 contains a list of abbreviations. 

Each chapter contains a table setting out the following information. 

• 

the second column shows the GFS Guideline item numbers as listed in Annex II 
of the GFS Guideline. 

9    For more information see the ECB statistical paper New and timely statistical indicators on government 

debt securities, June 2015. 

Government finance statistics guide 

7 

 
 
                                                                    
• 

• 

the third column shows the item numbers used in the reporting tables sent to the 
NCBs for collecting the GFS data (which include not only the items in the 
Guideline but also some additional voluntary items reported by the NCBs). This 
column also shows how items in the GFS reporting tables relate to each other. 

the fourth column shows the corresponding codes in the ESA 2010. 

Government finance statistics guide 

8 

 
 
2 

Government revenue, expenditure and 
deficit/surplus (Table 1a) 

2.1 

Introduction to Table 1a 

Government revenue and expenditure are defined in ESA 2010 paragraphs 20.76 and 
20.91-20.92 respectively, as well as in Box 20.1. Government revenue and 
expenditure are recorded on an accrual basis, as are all transactions in the ESA 2010. 

General government revenue and expenditure are respectively the sum of general 
government resources and the sum of general government uses that are transactions 
between units. ESA 2010 1.67-1.69 divides transactions into those within units and 
those between units.10  Transactions within units (intra-unit transactions) are excluded 
from the definitions of government revenue and expenditure since they do not affect 
net lending/net borrowing. The purpose of recording them in the ESA 2010 is to give a 
more analytically useful picture of output, final uses and costs. Most intra-unit 
transactions are transactions in products, typically recorded when institutional units 
consume some of the output they have produced themselves. By contrast, 
transactions between units (inter-unit transactions) generally have a counterpart 
transaction in the financial account and so affect net lending (+)/net borrowing (-). The 
practical application of this principle means that some ESA 2010 transactions, such as 
other non-market output and final consumption expenditure, are not explicitly recorded 
in government revenue and expenditure, whereas others, such as intermediate 
consumption and compensation of employees, are part of them. 

Transactions within general government are consolidated only if the expenditure and 
revenue are in the same transaction line and same account in the ESA 2010. As such, 
current transfers within general government (D.73), interest (D.41), dividends (D.421), 
investment grants (D.92) and other capital transfers (D.99) are consolidated, but 
transactions in goods and services, taxes and subsidies are not. 

In general, government revenue and expenditure are almost never recorded net, 
e.g. government interest receipts are not netted off against government interest 
payments. The one exception to this “no netting” rule is that capital formation is net of 
sales of capital assets, in accordance with the ESA 2010. The payable tax credits 
should be recorded as government expenditure for the total amount (ESA 2010 
20.168). 

The ECB GFS Guideline breaks government revenue down into current and capital 
revenue, and government expenditure into current and capital expenditure. These four 
categories do not exist in the ESA 2010 but are part of the ECB Guideline for analytical 
purposes. Current revenue less current expenditure equates to gross savings of 
general government. 

10    Units are defined in the ESA 2010, paragraph 2.12. 

Government finance statistics guide 

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2.2 

Table 1a: format and contents 

Table 1a below illustrates the format and contents of the reporting table used by the 
ECB to collect GFS data from NCBs. The table shows the item numbers used in 
Table 1a of the GFS Guideline and the corresponding line numbers in the reporting 
table, the relationships between the line and item numbers, and the ESA 2010 codes. 

Table 1a 
Government revenue and expenditure 

Guideline 
item 
number 
Table 1a 

Reporting table line 
number and 
relationships 

ESA 2010 codes 
(U = uses, R = resources) 

Description 

Deficit (-) or surplus (+) 

  Central government (S.1311) 

  State government (S1312) 

  Local government (S1313) 

  Social security funds (S1314) 

Total revenue 

Total current revenue 

  Current taxes on income, wealth, etc. 

  Taxes on production and imports 

  Taxes on products 

  of which: value added tax (VAT) 

  Other taxes on production 

  Net social contributions 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

1 = 6-21 
1 = 2+3+4+5 

B.9 

2 

3 

4 

5 

6 = 7+19 

7 = 8+9+13+16+17 

8 

9 = 10+12 

10 

11 

12 

13 

14 

15 

D.5 R 

D.2 R 

D.21 R 

D.211 R 

D.29 R 

D.61 R 

D.611 R 

D.613 R 

  of which: employers’ actual social contributions 

14 

  of which: households’ actual social contributions 

15 

  Sales 

16 

16 = 16a+16b 

P.11 R+P.12 R+P.131 R 

  Market output and output for own final use 

  Payments for non-market output 

16a 

16b 

P.11 R+P.12 R 

P.131 R 

  Other current revenue 

17 

17 = 17a+17b+17c 

D.39 R+D.4 R+D.7 R   

  Subsidies on production receivable 

  Other current transfers receivable 

  Property income receivable 

  of which: interest receivable 

Total capital revenue 

  of which: capital taxes 

Total expenditure 

Total current expenditure   

Intermediate consumption 

  Compensation of employees 

  of which: wages and salaries 

Interest payable 

  Subsidies payable 

  Subsidies on products payable 

  Other subsidies on products payable 

17a 

17b 

17c 

18 

19 

20 

21 = 22+31 

22 = 
23+24+26+27+28+29+3
0 

23 

24 

25 

26 

D.39 R 

D.7 R 

D.4 R 

D.41 R, consolidated 

D.9 R 

D.91 R 

P.2 U 

D.1 U 

D.11 U 

D.41 U, consolidated 

27 = 27a+27b 

  27a 

  27b 

-D.3 R   

-D.31 R 

-D.39 R 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

Government finance statistics guide 

10 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Description 

Guideline 
item 
number 
Table 1a 

Reporting table line 
number and 
relationships 

  Social benefits other than social transfers in kind 

28 

  of which: old age pensions and survivors’ 

pensions 

  of which: unemployment benefits 

  Social transfers in kind – purchased market 
production 

  Other current expenditure 

  Other taxes on production 

  Other property income payable 

  Current taxes on income, wealth, etc. payable 

  Other current transfers payable 

  Adjustment for the change in pension 

entitlements 

Total capital expenditure 

  Gross fixed capital formation 

  Other net acquisitions of non-financial assets and 
changes in inventories 

29 

30 

31 

32 

33 

28 

28a 

28b 

29 

ESA 2010 codes 
(U = uses, R = resources) 

D.62 U 

(COFOG 10.2.0+COFOG 10.3.0) 
applied to D.62 U 

COFOG 10.5.0 applied to D.62 U 

D.632 U 

30 = 
30a+30b+30c+30d+30e 

D.29 U+(D.4 U-D.41 U)+D.5 
U+D.7 U+D.8 U 

30a   

30b 

30c 

30d 

30e 

D.29 U 

D.4 U-D.41 U 

D.5 U 

D.7 U 

D.8 U 

31 = 32+33+34 

32 

P.51 U 

33=33a+33b 

P.52 U+P.53 U+NP U 

  Changes in inventories and acquisitions less 

33a   

P.52 U+P.53 U 

disposals of valuables 

  Acquisitions less disposals of non-financial 

non-produced assets 

  Capital transfers payable 

34 

  of which: investment grants 

Memorandum items 

33b 

34 

34a 

NP U 

D.9 U, consolidated 

D.92 U 

Capital transfers representing taxes and social 
contributions assessed but unlikely to be collected 

35 

35 

-D.995 U 

2.3 

Line-by-line analysis of Table 1a 

Item 1: Deficit (-) or surplus (+) 

This refers to the balance of net lending (+)/net borrowing (-) (B.9) of the general 
government sector in national accounts, which is the balance of the capital account. 

This item is equal to the difference between total revenue (item 6) and total 
expenditure (item 21), which implies that if the government is spending more than it is 
receiving, the figure recorded in item 1 will be negative. 

Items 2 to 5: Deficit (-) or surplus (+) by sub-sector 

This refers to net lending (+)/net borrowing (-) (B.9) by the sub-sectors of general 
government. 

Government finance statistics guide 

11 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
State government refers to the regional level of government, in between central and 
local government. It does not refer to that part of central government sometimes called 
“the state”, as in “the state budget”. It is confined to those countries that are a 
federation of regional governments, such as Belgium, Germany, Austria and Spain. 

Item 6: Total revenue 

This is the set of ESA 2010 non-financial transactions that increase the general 
government net lending (surplus) or reduce net borrowing (deficit). They are 
transactions that increase net financial worth. 

Item 7: Total current revenue 

This is the set of ESA 2010 non-financial transactions that increase gross saving. It is 
the sum of taxes and net social contributions, sales and other current revenue. 

Item 8: Current taxes on income, wealth, etc. 

Current taxes on income, wealth, etc. (D.5) cover all compulsory, unrequited 
payments, in cash or in kind, levied periodically by general government and by the rest 
of the world on the income and wealth of institutional units, and some periodic taxes 
which are assessed on neither income nor wealth (ESA 2010 4.77-4.82). These taxes 
are not consolidated in GFS, so any taxes paid by one part of government to another 
are included as both revenue and expenditure. For example, some non-profit 
institutions, or extra-budgetary funds, classified as belonging to the government sector 
may be liable for tax on their interest income. 

Item 9: Taxes on production and imports 

Taxes on production and imports (D.2) receivable by general government are 
compulsory, unrequited payments, in cash or in kind, levied by general government in 
respect of the production and import of goods and services, the employment of labour 
or the ownership or use of land, buildings or other assets used in production 
(ESA 2010 4.14-4.29). These taxes are not consolidated. For example, taxes on the 
use of buildings by government entities (D.29) should be included in both revenue and 
expenditure. 

Item 10: Taxes on products 

Taxes on products (D.21) receivable by general government are compulsory, 
unrequited payments, in cash or in kind, levied by general government per unit of a 

Government finance statistics guide 

12 

 
 
given good or service produced or transacted. These include, for example, value 
added type taxes, import duties and taxes, and excise and stamp taxes. 

Item 11: Value added tax (VAT) 

ESA 2010 4.17 defines VAT as a tax on goods or services collected in stages by 
enterprises and which is ultimately charged in full to the final purchaser. 

Item 12: Other taxes on production 

Other taxes on production (D.29) consist of all taxes levied as a result of production, 
independent of the quantity or value of the goods and services produced or sold. 
These taxes include, for example, taxes on ownership and use of land or fixed assets 
in production, taxes paid for business and professional licences, and taxes on 
pollution from production activities. 

Item 13: Net social contributions 

Net social contributions are recorded as resources of government (D.61). They are 
composed of employers’ actual social contributions (D.611), employers’ imputed social 
contributions (D.612), households’ actual social contributions (D.613) and households’ 
social contribution supplements (D.614), less social security scheme service charges 
(D.615). Actual social contributions are payments received by general government 
either from employers for their employees (ESA 2010 4.92-4.96) or from households 
on their own behalf (ESA 2010 4.100) under social security schemes or insurance and 
pension schemes, including schemes organised for an employer’s own employees. 
Employers’ imputed social contributions include estimates of accruing pension 
obligations to currently employed government staff; in practice, the imputation is 
usually based on amounts currently contributed by general government units under 
pay-as-you-go unfunded insurance schemes (ESA 2010 4.97-4.99). The imputed 
social contributions are included as part of compensation of employees (D.1) – a use 
from the employer perspective and resource from the household perspective – to 
reflect the true economic cost of employing staff in an unfunded pay-as-you-go 
pension scheme. The amounts are then recorded as imputed payments from 
households to government in D.612. The actual pensions paid are recorded in D.6211. 

Item 14: Employers’ actual social contributions 

This item consists of employers’ actual social contributions (D.611) payable by 
employers into social security schemes and into funded autonomous pension 
schemes by government, but re-routed in the national accounts as payments from 
employers to households and then as payments from households to government. 

Government finance statistics guide 

13 

 
 
Item 15: Households’ actual social contributions 

These are social contributions payable by households (employees, self-employed and 
non-employed persons) into social security schemes and into funded autonomous 
pension schemes of government (D.613). 

Item 16: Sales 

Sales consist of the following resources of government in the ESA 2010: market 
output (P.11), output for own final use (P.12) and payments for non-market output 
(P.131). 

Market output (P.11) is equal to charges for goods and services by market 
establishments (some of which may be within the general government sector), plus 
sales at economically significant prices by non-market establishments (sometimes 
called “incidental sales”). Examples of where non-market establishments may charge 
economically significant prices (normally covering at least half of production costs) 
are: 

• 

• 

a government museum which charges economically significant prices for some of 
its services, such as refreshments and car parking for visitors, although its 
entrance fee is not economically significant; 

a government department or local authority which aims to reduce demand for 
road space and hence congestion by levying charges for the use of roads at 
certain times. 

Output for own final use (P.12) consists of goods or services that are retained by 
government either for final consumption or for gross fixed capital formation. For 
example, a government department might employ its own staff to construct specialised 
capital equipment for security purposes. The finished capital goods are regarded as 
having been sold by government to itself and are included in gross fixed capital 
formation (P.51g). This component is not strictly a sale since it is not a transaction with 
another unit. The inclusion of this transaction in revenue, and of the corresponding 
transaction in expenditure (gross fixed capital formation), constitutes an exception to 
the general principle that intra-unit transactions are eliminated in GFS. The reason is 
to ensure that expenditure on items such as capital formation is recorded in full to give 
a complete picture of government activity. The production of output for own final use is 
economically analogous to the case where general government produces investment 
goods and sells them on the market, and then buys similar goods from another 
producer. 

Payments for non-market output (P.131), sometimes called “partial payments”, consist 
of sales at prices that cover less than half of the production cost. This is the case, for 
instance, where a government health department charges patients for the provision of 
medicines, but at a standard price usually well below the cost of the medicines. Prices 
are not considered economically significant if they are not intended to influence 

Government finance statistics guide 

14 

 
 
demand and thus ration the distribution of the goods and services supplied, but rather 
to contribute to the cost. 

The sales, intermediate consumption and social transfers in kind purchased from 
market producers categories are not consolidated. In other words, the sale of a service 
by one government unit to another would add to the figures for sales and intermediate 
consumption in the GFS tables. 

Chapter 4 shows how sales relate to government output and consumption. 

Item 16a: Market output and output for own final use 

This item consists of market output (P.11) and output for own final use (P.12) as 
explained in item 16. 

Item 16b: Payments for non-market output 

This item consists of payments for non-market output (P.131) as explained in item 16. 

Items 16a and 16b are not included in the GFS Guideline, but are part of the GFS data 
request. 

Item 17: Other current revenue 

This consists of transactions that are part of current revenue and are not included in 
taxes (items 8 and 9), net social contributions (item 13) or sales (item 16). It comprises 
subsidies on production (D.39 U), property income (D.4) and other current transfers 
(D.7) (ESA 2010 20.85-20.90). 

Item 17a: Subsidies on production 

This item includes other subsidies on production (D.39 U) receivable by government 
units engaged in production. 

Item 17b: Other current transfers 

Other current transfers (D.7) include net non-life insurance premiums and claims, 
current international cooperation and miscellaneous current transfers. 

Government finance statistics guide 

15 

 
 
Item 17c: Property income 

Property income (D.4) is income received by owners of financial assets (investment 
income) and owners of natural resources (rents) for putting them at the disposal of 
other institutional units. This income includes interest, dividends, withdrawals from 
income of quasi-corporations, reinvested earnings on foreign direct investment, rents, 
etc. 

Items 17a, 17b and 17c are not included in the GFS Guideline, but are part of the GFS 
data request. 

Item 18: Interest receivable 

This is the amount that non-government units (debtors) become liable to pay to the 
government over a given period, without reducing the principal outstanding (D.41, 
ESA 2010 4.42-4.52). Interest receivable/payable is consolidated within general 
government. The recording of interest is explained in more detail in Chapter II.4 of the 
MGDD. 

Item 19: Total capital revenue 

This consists of capital taxes (D.91), investment grants (D.92) and other capital 
transfers (D.99) that are receipts of government. 

Capital transfers (D.92 and D.99) in cash consist of transfers of cash that the first party 
has raised by disposing of assets (other than inventories), or that the second party is 
expected or required to use for the acquisition of assets (other than inventories) or to 
pay off liabilities. Capital transfers in kind are transfers of ownership of an asset (other 
than inventories or cash), or the cancellation of a liability by a creditor without any 
counterpart being received in return (ESA 2010 4.145-4.167). 

Capital revenue does not include capital transfers (D.92 or D.99) within government, 
for example between central and local government, since these are consolidated. 

In some countries’ national accounts, capital transfers (D.995) are recorded for writing 
off taxes that accrue but are never paid. This ensures that net lending (+)/net 
borrowing (-) reflects only taxes that are actually collected, in cases where the accrued 
amounts recorded under taxes include amounts that are never collected. Such capital 
transfers should be recorded as negative figures under capital transfers received, 
rather than as positive figures under capital transfers paid. 

Item 20: Capital taxes 

Capital taxes (D.91) are taxes levied at irregular intervals on the value of assets 
owned or transferred. They include, for example, inheritance tax and taxes on 
increases in land values owing to land use regulations. 

Government finance statistics guide 

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Item 21: Total government expenditure 

This item consists mainly of the set of ESA 2010 non-financial transactions that 
decrease the general government net lending (surplus) or increase net borrowing 
(deficit). These are transactions that decrease net financial worth. 

Item 22: Total current expenditure 

This item consists mainly of the set of ESA 2010 non-financial transactions that 
decrease gross saving. It is the sum of intermediate consumption, compensation of 
employees, interest and subsidies payable, social benefits and other current 
expenditure. 

Item 23: Intermediate consumption 

This is the value of the goods and services consumed by government to produce its 
own output (P.2). It excludes the consumption of fixed capital (P.51C, ESA 2010 
3.88-3.92), which is not included in the GFS definition of government expenditure 
since it does not affect the deficit (B.9). 

Item 24: Compensation of employees 

This is the total remuneration, in cash or in kind, paid by government to its employees 
in return for work done by the latter during the accounting period (D.1, ESA 2010 
4.02). 

Item 25: Wages and salaries 

This item includes wages and salaries in cash and in kind (D.11, ESA 2010 4.03-4.07). 

Item 26: Interest payable 

This is the amount that government, as a debtor, becomes liable to pay to the creditor 
over a given period, without reducing the principal outstanding (D.41, ESA 2010 
4.42-4.52). Interest payable is consolidated within general government. The recording 
of interest is explained in more detail in Chapter II.4 of the MGDD. 

Item 27: Subsidies payable 

These are current unrequited payments from government to resident producers with 
the objective of influencing their production, their prices or the remuneration of factors 
of production (ESA 2010 4.30-4.40). Subsidies are not consolidated. The ESA 2010 

Government finance statistics guide 

17 

 
 
treats this item (D.3) as a negative resource of the government sector, rather than as a 
use, thus keeping it in the same part of the accounts as tax receipts. It is the only 
government “resource” included in government expenditure. Therefore, subsidies are 
presented in the tables with the sign reversed to be consistent with national accounts. 
For example, “- D.3 R” means that a positive figure should be recorded for subsidies 
payable by government. 

Note that subsidies include tax credits paid to corporations that are treated as 
government expenditure in national accounts and hence classified in D.3. 

Item 27a: Subsidies on products payable 

Subsidies on products (D.31) are paid by government per unit of a good or service 
produced or imported. Subsidies on products only apply to market output and output 
for own final use. 

Item 27b: Other subsidies on production payable 

These are subsidies other than subsidies on products that are paid to resident units for 
engaging in production. They include subsidies on payroll or workforce, subsidies to 
reduce pollution and interest relief grants. 

Items 27a and 27b are not included in the GFS Guideline, but are part of the GFS data 
request. 

Item 28: Social benefits other than social transfers in kind 

Social benefits (D.62) are transfers to households, other than transfers in kind, 
intended to relieve them from the financial burden of a number of risks and needs. 
They include payments under occupational pension schemes for government 
employees and state old age pension schemes, as well as social security and social 
assistance benefits in cash. 

Item 28a: Old age pensions and survivors’ pensions 

This item corresponds to the Classification of the Functions of Government (COFOG) 
10.2.0 and 10.3.0 data applied to the expenditure on social benefits other than social 
transfers in kind. These data are available in Table 11 of the ESA 2010 Transmission 
Programme (TP). T-1 data and back data should be based on best estimates when 
they are not available in the TP. 

Government finance statistics guide 

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Item 28b: Unemployment benefits 

This item relates to the COFOG 10.5.0 data applied to expenditure on social benefits 
other than social transfers in kind. These data are available in Table 11 of the 
ESA 2010 Transmission Programme (TP). T-1 data and back data should be based on 
best estimates when they are not available in the TP. 

Items 28a and 28b are not included in the GFS Guideline, but are part of the GFS data 
request. 

Item 29: Social transfers in kind – purchased market production 

Social transfers in kind via market producers (D.632) are goods and services 
produced by market producers and purchased by government, which supplies them to 
households without any transformation (ESA 2010 3.98.b). Note that for GFS it is 
necessary to distinguish between goods and services bought by government to 
produce government output (included in intermediate consumption (P.2)) and those 
bought by government from market producers and supplied directly to households 
without any processing by government (included in social transfers in kind via market 
producers (D.632)). Both are included in government final consumption expenditure 
(P.3). 

Item 30: Other current expenditure 

This item consists of current expenditure not included in any other category of current 
expenditure. It comprises other taxes on production (D.29), property income, 
excluding interest (D.4 except D.41), current taxes on income and wealth (D.5), other 
current transfers (D.7) and the adjustment for the change in pension entitlements (D.8) 
(ESA 2010 20.102-20.103). The adjustment for the change in net equity of households 
in pension funds reserves (D.8) is necessary only in the rare case where the 
government operates a funded pension scheme. 

Item 30a: Other taxes on production 

This item includes other taxes on production (D.29) payable by the government units 
involved in production. 

Item 30b: Other property income payable 

This item includes property income, excluding interest (D.4 except D.41) payable by 
the government units. 

Government finance statistics guide 

19 

 
 
Item 30c: Current taxes on income, wealth, etc., payable 

This item consists of current taxes on income, wealth, etc. (D.5) payable by the 
government units. 

Item 30d: Other current transfers payable 

This item consists of other current transfers (D.7) payable by the government units. 

Item 30e: Adjustment for the change in pension entitlement 

This item consists of the adjustment for the change in pension entitlements (D.8) 
(ESA 2010 20.102-20.103). This adjustment is necessary only in the rare case where 
the government operates a funded pension scheme. 

Items 30a to 30e are not included in the GFS Guideline, but are part of the GFS data 
request. 

Item 31: Total capital expenditure 

This item includes government gross fixed capital formation, net acquisition of other 
non-financial assets, changes in inventories and capital transfers. 

Netting off sales of assets from acquisitions in categories P.5 and NP is standard 
ESA 2010 practice. Thus, sales of non-financial assets such as buildings are not 
recorded as revenue, but as negative capital expenditure, making net lending/net 
borrowing more positive. This constitutes an exception to the general principle of not 
netting. 

Item 32: Gross fixed capital formation 

Gross fixed capital formation (P.51g) (government investment) is recorded within 
changes in government assets. It equals the acquisition less disposal of fixed assets, 
plus certain improvements to the value of non-produced assets such as land (e.g. by 
spending on sea defences or drainage) (ESA 2010 3.124-3.138). “Gross” here means 
before depreciation is deducted, but after the deduction of sales of capital assets. 

Government finance statistics guide 

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Item 33: Other net acquisitions of non-financial assets and changes 
in inventories 

This item comprises changes in inventories (P.52), net acquisition of valuables (P.53)11 
and net acquisition of non-financial non-produced assets (NPs). Note that “net” here 
means net of the sale of assets. 

Item 33a: Changes in inventories and acquisitions less disposals of 
valuables 

This item includes changes in inventories (P.52) and net acquisition of valuables 
(P.53). 

Changes in inventories (P.52) includes the acquisition of commodities to be held in 
stock for subsequent use as intermediate consumption, less the sale or consumption 
of commodities held in stock, plus changes in inventories of work-in-progress and 
finished goods (ESA 2010 3.146-3.153). Note that when stock is purchased or sold 
(P.52) there is an impact on net lending (+)/net borrowing (-), but when stocks are 
produced or consumed there is no impact. This is because output (P.1) offsets the 
positive stockbuilding when stocks are produced, and intermediate consumption (P.2) 
offsets the negative stockbuilding when stocks are consumed. 

Net acquisition of valuables (P.53) is the acquisition of goods that are not used 
primarily for production or consumption, but are held primarily as stores of value, such 
as precious metals and works of art (ESA 2010 3.154-3.157). It is unlikely that 
governments would hold such items as a store of value, since works of art acquired for 
display are regarded as producing cultural outputs and so should be included in fixed 
assets (P.51). 

Item 33b: Acquisitions less disposals of non-financial non-produced 
assets 

The net acquisition of NPs consists of the net acquisition of non-produced assets that 
may be used in the production of goods and services, such as land, sub-soil assets 
and non-cultivated biological resources (ESA 2010 3.184-3.194). It also includes 
intangible non-produced assets, such as contracts for the use of non-financial assets 
(for example property leases) that are subsequently traded. 

Items 33a and 33b are not included in the GFS Guideline, but are part of the GFS data 
request. 

11    Monetary gold is treated as a financial asset (F.1), not as a valuable (P.53). 

Government finance statistics guide 

21 

 
 
                                                                    
Item 34: Capital transfers payable 

This consists of investment grants (D.92) payable by government (see item 34a) and 
other capital transfers (D.99). ESA 2010 4.164 states, “other capital transfers (D.99) 
cover transfers other than investment grants and capital taxes which do not 
themselves redistribute income but redistribute saving or wealth among the different 
sectors or sub-sectors of the economy or the rest of the world.”. These include the 
capital transfers recorded as the counterpart to an assumption of debt by mutual 
consent. A comprehensive list of transactions is given in ESA 2010 4.165. 

Note that there are special rules for distinguishing between capital transfers and 
financial transactions in the case of payments between government and public 
corporations (see Chapter III of the MGDD for more details). For example, a capital 
injection from government to a public corporation might be described in legal terms as 
the acquisition of equity. In national accounts it would be classified as a capital transfer 
and not as a financial transaction, provided the government is not acting as a rational 
investor expecting a commercial return on its investment. 

Capital transfers (D.995) are recorded for cancelling taxes that accrue but are never 
paid. These should be recorded as negative figures under capital transfers received, 
rather than as positive figures under capital transfers payable (see item 35). 

Item 34a: Investment grants 

Investment grants (D.92) consist of capital transfers in cash or in kind made by 
governments or by the rest of the world to other resident or non-resident institutional 
units to finance all or part of the costs of their acquiring fixed assets (ESA 2010 4.152). 
Item 34a is not included in the GFS Guideline, but it is part of the GFS data request. 

Item 35: Capital transfers representing taxes and social 
contributions assessed but unlikely to be collected (memo item) 

In some countries’ national accounts, capital transfers (D.995) are recorded for 
cancelling taxes that accrue but are never paid. This ensures that net lending (+)/net 
borrowing (-) reflects only taxes that are actually collected (or are likely to be 
collected). Such capital transfers should be recorded as negative figures under capital 
transfers received (under item 19), rather than as positive figures under capital 
transfers payable. 

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3 

Transactions with EU budget and the 
European Development Fund (EDF) 
(Table 1b) 

3.1 

Introduction to Table 1b 

In the ESA 2010 national accounts, total government revenue and expenditure are 
defined as groups of non-financial transactions of the general government sector of a 
Member State. Transactions between the resident sectors of the national economy 
and the EU budget are treated as transactions with the rest of the world (S.2) – and 
specifically with institutions and bodies of the EU (S.212). These transactions include 
transfers to finance the European Development Fund (EDF) managed by the 
European Commission as an extra-budgetary fund. In economic terms, however, EU 
budget subsidies are similar in their impact to subsidies paid by (national) general 
government. Likewise, the taxpayer perception is that taxes that are resources of the 
EU budget and the EDF are similar to those paid to (national) general government. To 
better understand the extent of both national and EU government activity in a Member 
State, information on the EU budget and the EDF transactions is therefore required. 

The data on the EU budget and EDF transactions in Reporting Table 1b allow the ECB 
to examine, for each Member State, the payments made by the resident sectors of the 
economy to the EU budget and the EDF, and also EU expenditure in the Member 
State. This enables net payers into and net recipients of the EU budget to be identified, 
along with the impact of the EU budget and the EDF transactions on the general 
government deficit/surplus. 

Chapter 8 contains a detailed description of the treatment of the EU budget and EDF 
transactions in the compilation of euro area and EU aggregates. 

In addition, Table 1b includes transactions with the Single Resolution Board/Single 
Resolution Fund (SRB/SRF). These transactions are the contributions from the 
Member States’ financial institutions to the SRB/SRF and capital transfers from the 
SRB/SRF to the financial entity in the Member States in cases where the SRB/SRF 
conducts a resolution of a financial institution in a Member State. 

3.2 

Table 1b: format and contents 

The table below shows the format and contents of Reporting Table 1b used by the 
ECB to collect GFS data from NCBs. The table shows the item numbers used in 
Table 1b of the GFS Guideline and the corresponding line numbers in the reporting 
table, the relationships between the line and item numbers, and the ESA 2010 codes. 

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Table 1b 
Transactions with the EU budget and the EDF 

Description 

Guideline item 
number Table 1b 

Reporting table line number 
and relationships 

ESA 2010 
codes 

Revenue of the European Union (EU) budget and of the 
European Development Fund (EDF) from the Member 
State 

Taxes on production and imports 

Current international cooperation 

Miscellaneous current transfers and EU own resources 

  of which: VAT-based third own resource 

  of which: GNI-based fourth own resource 

  of which: UK rebate 

Capital transfers 

Expenditure of the EU budget in the Member State 

Subsidies 

Current transfers to government 

Current transfers to non-government 

Capital transfers to government 

Capital transfers to non-government 

Own resources collection costs 

Balance of Member State vis-à-vis the EU budget and 
the EDF (net recipient +, net payer -) 

Memo: Member State net revenue from pre-acceding 
programmes 

Memo: Net revenue from pre-acceding programmes paid to 
government 

Transactions with the Single Resolution Board/Single 
Resolution Fund(SRB/SRF) 

Contributions to the Single Resolution Board/Single 
Resolution Fund (SRB/SRF) 

Capital transfers from SRB/SRF 

  of which: to financial entities in general government 

1 

2 

3 

4 

5 

6 

- 

7 

8 

9 

10 

11 

12 

13 

14 

15 

- 

- 

- 

- 

- 

1 = 2+3+4+7 

2 

3 

4 

5 

6 

6a 

7 

8 = 9+10+11+12+13+14 

9 

10 

11 

12 

13 

14 

15 = 8-1 

16 

17 

18 

19 

20 

D.2 

D.74 

D.75+D.76 

D.761 

D.762 

D.762K 

D.9 U 

D.3 

D.74+D.75 

D.75 

D.9 R (S13) 

D.9 R (S1W) 

P.131 

D.29 

D.9 

D.9 

3.3 

Line-by-line analysis of Table 1b 

Item 1: Revenue of the EU budget and of the EDF from the Member 
State 

This is the total of taxes on production and imports (D.2) received by the EU budget, 
plus other current transfers (D.7) and capital transfers (D.9) paid by general 
government to the EU budget and the EDF as recorded in national accounts. 

Government finance statistics guide 

24 

 
 
 
 
 
 
 
 
 
 
 
Item 2: Taxes on production and imports 

These comprise EU own resources, including several types of taxes on production 
and imports. 12  The national accounts of Member States classify them as taxes on 
production and imports (D.2) paid by national residents to the institutions of the EU 
(S.212). 

Note that the full amount of these taxes collected is included, not just the net amount 
paid after deduction of collection costs. The collection costs (item 14) are treated as a 
sale of a service by government (P.131) to the rest of the world. 

Item 3: Current international cooperation 

Current international cooperation (D.74) includes current transfers paid by general 
government to the EU budget and the EDF other than the fourth resource. These 
could include transfers to finance the EDF managed by the European Commission as 
an extra-budgetary fund. 

Item 4: Miscellaneous current transfers and EU own resources 

This line is for miscellaneous current transfers (D.75), as well as VAT-based and 
GNI-based EU own resources (D.76) paid by government to the EU, i.e. the UK rebate 
and the third and the fourth resources (see below). 

Item 5: VAT-based third own resource 

This is the value added tax (VAT)-based contribution (the third resource) to the EU 
budget. It includes any currency transfers paid by the general government of each 
Member State to the EU budget under the third resource. 

Item 6: GNI-based fourth own resource 

This is the gross national income (GNI)-based contribution (the fourth resource) to the 
EU budget. It includes any current transfers paid by the general government of each 
Member State to the EU budget under the fourth resource. 

12    Such as receipts from the CAP, levies on imported agricultural products, monetary compensatory 

amounts levied on exports and import, sugar production levies and the tax on isoglucose, 
co-responsibility levies on milk and cereals, receipts from trade with third countries and customs duties 
levied on the basis of the Integrated Tariff of the European Union (TARIC). 

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Item 6a: UK rebate 

The UK rebate is a reduction, agreed by the European Council, in the payments to the 
EU budget by the UK, compensated by increased payments from other Member 
States. This item is not part of the GFS Guideline, but is included as a voluntary item in 
the GFS reporting tables. This item will be applicable until the UK is in the EU. 

Item 7: Capital transfers 

This would include the exceptional case where a national government pays an 
investment grant to the EU budget. 

Item 8: Expenditure of the EU budget in the Member State 

This equals payments from the EU budget to government units and non-government 
resident sectors as recorded in national accounts. 

Item 9: Subsidies 

Typically, this consists of agricultural subsidies paid under the Common Agricultural 
Policy (CAP). In national accounts, these are transactions between the rest of the 
world and non-government resident sectors in D.3. 

Item 10: Current transfers to government 

These are general government resources in current international cooperation (D.74) 
and miscellaneous current transfers (D.75). They can include rebates to national 
governments from the EU budget, and current transfers to government units to fund 
activity in those units. Government units in receipt of EU transfers can, for example, 
include government scientific institutions undertaking EU-funded research and 
development programmes. 

Item 11: Current transfers to non-government units 

Non-government here includes households (S.14) and Non-profit institutions serving 
households (NPISHs) (S.15). Typically, these are payments under the European 
Social Fund, such as transfers for education and training, and are classified under 
D.75. 

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Item 12: Capital transfers to government 

These are general government receipts of investment grants (D.92). The item could 
include transfers to local government for structural improvements, such as road 
building and other European Regional Development Fund (ERDF) programmes, 
where government units acquire capital assets rather than passing the transfers on to 
non-government units for them to acquire capital assets. 

Item 13: Capital transfers to non-government units 

Typically, these are investment grants (D.92) paid from the European Agricultural 
Guidance and Guarantee Fund (EAGGF) and the ERDF programmes. 

Item 14: Own resources collection costs 

Member State governments collect taxes on behalf of the EU budget and transfer 
amounts to the EU budget net of an agreed amount to cover collection costs. The 
difference between the amount collected and the actual funds passed to the EU 
budget is recorded as payments to government for non-market output (P.131). EU tax 
receipts are recorded gross (i.e. before deduction of the collection costs). 

Item 15: Balance of Member State vis-à-vis the EU budget and the 
EDF 

This item equals expenditure of the EU budget in the Member State (item 8) less the 
revenue of the EU budget and the EDF from the Member State (item 1). It represents 
the net impact of transfers between the Member State on the one hand and the EU 
budget and the EDF on the other. 

Note that the EU budget and the EDF payments and receipts include only subsidies, 
taxes and other transfers; they do not include payments for goods and services or 
wages in the Member State. 

Items 16 and 17: Net revenue from pre-acceeding programmes 
(memo items) 

Net revenues from the pre-accession funds (Poland and Hungary Assistance for the 
Restructuring of the Economy (PHARE), Instrument for Structural Policies for 
Pre-Accession (ISPA), Special Accession Programme for Agriculture and Rural 
Development (SAPARD), etc.) are not part of the transactions between the EU budget 
and a Member State. This is because these pre-accession funds represent a 
relationship between the EU budget and countries which are not Member States and 
so should not be recorded in Table 1b as EU budget transactions with Member States, 
even if funds are paid under continuing multi-year programmes. However, it may 

Government finance statistics guide 

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sometimes be difficult around the time of accession to allocate the relevant funds to 
the correct programme, hence the presence of two additional memorandum items in 
Table 1b of the GFS data request (not included in the GFS Guideline): “Member State 
net revenue from pre-acceding programmes” (item 16) and “Net revenue from 
pre-acceding programmes paid to government” (item 17). 

Item 18: Contributions to the Single Resolution Board/Single 
Resolution Fund (SRB/SRF) 

The Single Resolution Board (SRB) and the Single Resolution Fund (SRF) were 
created in 2016 as part of a common framework for carrying out resolution activities in 
the EU. The SRB is the central resolution authority within the EU Banking Union. The 
SRB is classified in the sector “Institutions and bodies of the European Union” (S.212) 
as a government entity resident in the EU outside the euro area. The SRF is 
composed of contributions from credit institutions and certain investment firms in the 
participating Member States within the EU Banking Union. The SRF has no autonomy 
of decision and is not considered a separate institutional unit. It is therefore classified 
together with the SRB. 

This item includes the contributions that the SRB is entitled to levy – normally a power 
exclusive to government entities. The contributions raised at national level are 
transferred to the SRF over the eight-year transitional phase starting in 2015. The 
contributions are recorded as an EU tax (other taxes on production – D.29), including 
the 2015 contributions collected by the National Resolution Authority/National 
Resolution Fund and transferred to the SRF in 2016 (as an EU tax in 2015). 

Item 19: Capital transfers from the SRB/SRF 

The SRB/SRF may use its resolution tools to support a failing financial institution. The 
amounts transferred by the SRB/SRF to the financial institutions under resolution are 
recorded as capital transfers (D.9). 

Item 20: Capital transfers to financial entities in general government 

This item includes capital transfers to financial entities that are classified in the general 
government sector. Where resolution activities apply, there are two possible cases 
with different classification implications: (i) viable institutions that will continue to be 
financial intermediaries (classified asS.122); and (ii) non-viable institutions (known as 
“defeasance structures” in the ESA 2010) that hold impaired assets which are 
extinguished progressively through the realisation of the assets. The latter may be 
classified in the general government sector based on the control and the risk and 
reward criteria. 

Items 18, 19 and 20 are not part of the GFS Guideline, but are included as voluntary 
items in the GFS reporting tables. 

Government finance statistics guide 

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4 

Government consumption expenditure 
and other non-financial categories 
(Table 1c) 

4.1 

Introduction to Table 1c 

The purpose of Table 1c is to collect data on government final consumption. 

Final consumption expenditure is defined in ESA 2010 20.108 as the expenditure 
incurred by resident institutional units on goods or services that are used for the direct 
satisfaction of individual needs or wants or the collective needs of the community. 
Final consumption expenditure may take place on the domestic territory or abroad (in 
which case it is, at least in principle, reflected in imports of goods and services). 
General government final consumption expenditure includes two categories of 
expenditure. 

• 

• 

The value of the goods and services produced by general government itself (P.1) 
other than market output (P.11), output for own final use (P.12) and payments for 
non-market output (P.131). 

Purchases by general government of good and services produced by market 
producers that are supplied to households, without any transformation, as social 
transfers in kind (D.632). General government pays for these goods and services 
that the sellers provide to households. 

Table A shows the relationship between expenditure components, government output 
and government final consumption. The highlighted areas show, for each column, the 
components of final consumption. The last column shows that government final 
consumption consists of both individual and collective government consumption, as 
explained above. The middle column shows that government final consumption 
consists of the following. 

• 

Social transfers in kind – market production purchased by general government 
and NPISHs (D.632). These are goods and services produced by market 
producers and purchased by government, which supplies them to households 
without any transformation (ESA 2010 3.98.b). 

•  Other government non-market output (P.132), which is government output that is 

supplied free of charge. 

The table also shows that the other components of government output (P.11, P.12 and 
P.131), which together constitute the sales of government, are not part of government 
consumption. 

Government finance statistics guide 

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Table A 
The relationship between GFS expenditure components, government output and final 
consumption 

GFS expenditure items 
and other items 

Classification of the output and/or classification of the 
sale/transfer of the output by government 

Sector consuming the output (as 
either final consumption or capital 
formation) 

Social benefits and 
transfers 

Social transfers in kind of goods and services produced by 
market producers (D.632) 

Government individual final 
consumption expenditure (P.31) 

Government output 

= intermediate 
consumption 

+ compensation of 
employees 

+ taxes less subsidies 

+ consumption of fixed 
capital 

+ net operating surplus 

Other government 
non-market output 
(P.132) 

(total non-market 
output less P.131) 

Social transfers in kind – general 
government and NPISHs’ non-market 
production 

(D.631) 

Other output of government not 
attributed to individual beneficiaries 

Government collective final 
consumption expenditure (P.32) 

Sales (GFS revenue 
item) 

Payments for government 
non-market output (P.131) 

Any sector: either final consumption or 
capital formation 

Government market output (P.11) 

Government output for own final use 
(P.12) 

Part of government gross fixed capital 
formation (P.51) 

Note: The highlighted areas show, for each column, the components of final consumption. 

4.2 

Table 1c: Format and contents 

The table below shows the format and content of Reporting Table 1c used by the ECB 
to collect data from NCBs. The table shows the item numbers used in Table 1c of the 
GFS Guideline and the corresponding line numbers in the reporting table, the 
relationships between the line and item numbers, and the ESA 2010 codes. 

Government finance statistics guide 

30 

 
 
Table 1c 
Government final consumption expenditure 

Guideline item 
number Table 1c 

Reporting table line number and 
relationships1 

Description 

Final consumption expenditure   

Individual consumption expenditure 

Collective consumption expenditure 

Consumption of fixed capital 

Taxes on production paid less subsidies received 

Net operating surplus 

Memo items: 

Final consumption expenditure at prices of the 
previous year 

Gross fixed capital formation at prices of the 
previous year 

1 

2 

3 

4 

5 

6 

7 

8 

Gross domestic product (GDP) at current prices 

9 

GDP at prices of the previous year 

Current taxes on income, wealth, etc. paid by 
corporations to government and rest of the world 

Current taxes on income, wealth, etc. paid by 
households and non-profit institutions serving 
households (NPISHs) to government and rest of the 
world 

10 

11 

12 

Note: 1 [x.y] refers to item number y of Table x. 

1 = 2+3 

[1A.23]+[1A.24]+ 
[1A.29]+4+5+6-[1A.16] 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

ESA2010 codes 
(U = uses, R = 
resources) 

P.3 = P.31+P.32 

P.31 

P.32 

P.51c 

D.29 U – (D.39 
R) 

B.2n 

P.3 (volume) 

P.51g (volume) 

B.1*g at market 
prices 

B.1*g (volume) 

D.5, S1, S1K 

D5, S1, S1M 

4.3 

Line-by-line analysis of Table 1c 

Item 1: Final consumption expenditure 

This item is P.3 for the general government sector. According to ESA 2010 3.94 “final 
consumption expenditure consists of expenditure incurred by resident institutional 
units on goods or services that are used for the direct satisfaction of individual needs 
or wants or the collective needs of members of the community.” Final consumption 
expenditure may take place on the domestic territory or abroad. Note that it is net of 
the sale of services to EU institutions in respect of the collection of EU taxes (export of 
a service). However, EU institutions’ own administrative expenditure in a Member 
State, for example on employing statisticians in Luxembourg, would not be included in 
the Luxembourg figure for government expenditure. 

General government final consumption expenditure can be divided into individual 
consumption expenditure (P.31) and collective consumption expenditure (P.32). 

Government finance statistics guide 

31 

 
 
Item 2: Individual consumption expenditure 

Individual consumption expenditure (P.31) has the following characteristics: 

• 

• 

• 

• 

it satisfies the individual needs of household members; 

it is possible to observe the consumption of goods and services by household 
members; 

households agree to consume the goods and services and take action to make it 
possible, for example by attending a school; 

consumption of goods and services by one household means that less goods 
and services are available for other households. 

Item 3: Collective consumption expenditure 

Collective consumption expenditure (P.32) has the following characteristics: 

• 

• 

• 

the consumption by government is used to provide services simultaneously to all 
members of the community; 

households’ use of such services is usually passive and does not require their 
express agreement or active participation; 

provision of the service to one household does not reduce the services available 
to others. 

Item 4: Consumption of fixed capital 

This item consists of the capital consumption (P.51c, ESA 2010 3.139-3.145) of 
market and non-market establishments of units classified under general government. 
For national accounts, it is usually computed through a perpetual inventory model 
rather than being collected directly from government units. Depreciation in business 
accounts is a similar concept to capital consumption but may follow different valuation 
rules. 

Item 5: Taxes on production paid minus subsidies received 

This item is general government payments of other taxes on production (D.29 uses) 
less receipts of other subsidies on production (D.39 resources). These components 
are included in Table 1a, items 30a and 17a. Subsidies are shown with a positive sign 
(national accounts follow a different sign convention: subsidies receivable are a 
negative use and subsidies payable are a negative resource). Note that taxes or 
subsidies on products (D.21 and D.31 respectively) cannot be consolidated because 
there is no counterpart sector in the ESA for such transactions; the relevant amounts 
are not recognised separately as expenditure and revenue (respectively) and are 

Government finance statistics guide 

32 

 
 
instead included in, or excluded from, the value of the intermediate consumption or of 
the sales. In other words, other taxes on production include, for example, taxes on the 
use of buildings and cars, but not taxes included in the prices of products, which are 
already counted in intermediate consumption. Other subsidies on production include, 
for example, subsidies on labour, but not subsidies included in prices paid, which are 
already counted in intermediate consumption. 

Item 6: Net operating surplus 

This item is B.2n of the general government sector. It analyses the extent to which 
government market output covers intermediate consumption, compensation of 
employees, other taxes less subsidies on production, and the consumption of fixed 
capital necessary for market output. For government non-market output, the net 
operating surplus is by definition equal to zero. 

Item 7: Government final consumption expenditure at prices of the 
previous year (memo item) 

This item is government final consumption (item 1) in chain-linked volumes at prices of 
the previous year (reference year 2010). In order to measure the volume growth of 
government final consumption, the effect of price changes must be eliminated. To 
achieve this, most EU countries in the past used a fixed weighting structure that was 
updated every five years. However, if fixed weights are used for a prolonged period, 
they become less relevant over time. To achieve more accurate and internationally 
comparable volume growth figures, NSIs and Eurostat have, since 2005, introduced 
weights that are updated annually, using values at the prices of the previous year, in 
line with EU legislation. The results obtained using these weights are subsequently 
(chain-)linked. 

Item 8: Gross fixed capital formation at prices of the previous year 
(memo item) 

This item is government investment (item 33 of Table 1a) in chain-linked volumes at 
prices of the previous year (reference year 2010). In order to measure the volume 
growth of government investment, the effect of price changes must be eliminated. To 
achieve this, most EU countries in the past used a fixed weighting structure that was 
updated every five years. However, if fixed weights are used for a prolonged period, 
they become less relevant over time. To achieve more accurate and internationally 
comparable volume growth figures, NSIs and Eurostat have, since 2005, introduced 
weights that are updated annually, using values at the prices of the previous year, in 
line with EU legislation. The results obtained using these weights are subsequently 
(chain-)linked. 

Government finance statistics guide 

33 

 
 
Item 9: Gross domestic product (GDP) at current prices (memo 
item) 

Gross domestic product at market prices is defined in ESA 2010 8.89. 

Item 10: GDP at prices of the previous year (memo item) 

This item is GDP in chain-linked volumes at prices of the previous year (reference year 
2010). In order to measure the volume growth of GDP, the effect of price changes must 
be eliminated. To achieve this, most EU countries in the past used a fixed weighting 
structure that was updated every five years. However, if fixed weights are used for a 
prolonged period, they become less relevant over time. To achieve more accurate and 
internationally comparable volume growth figures, NSIs and Eurostat have, since 
2005, introduced weights that are updated annually, using values at the prices of the 
previous year, in line with EU legislation. The results obtained using these weights are 
subsequently (chain-)linked. 

Item 11: Current taxes on income, wealth, etc. paid by corporations 
to government and rest of the world (memo item) 

Current taxes on income, wealth etc. (D.5) payable by corporations include the part of 
taxes payable by units in the financial or non-financial corporation sectors in national 
accounts. Typically, these are taxes on company profits, including taxes on capital 
gains as well as on operating income. The item includes taxes payable both to 
government units and to units resident in other economies. 

Item 12: Current taxes on income, wealth, etc. paid by households 
and non-profit institutions serving households (NPISHs) to 
government and rest of the world (memo item) 

Current taxes on income, wealth, etc. (D.5) payable by households include taxes 
payable by households and NPISHs. These include, for example, taxes on income 
and capital gains, motor vehicle licence fees paid by households and capital gains 
taxes. The item includes taxes payable both to government units and to units resident 
in other economies. 

Government finance statistics guide 

34 

 
 
5 

Government deficit-debt adjustment 
(Table 2a) 

5.1 

Introduction to Table 2a 

Table 2a shows how the general government deficit is financed and considers the 
relationship between the deficit and Maastricht debt. The ability to reconcile the 
change in general government debt with the deficit, through the analysis in Table 2a, 
provides an important data quality check. Since government deficit and debt are the 
primary focus of fiscal surveillance, it is important to understand why they diverge. 

Although government deficit and debt are closely interrelated concepts, the change in 
the debt level in any given year can be larger or smaller than the deficit. The difference 
between the change in debt and the deficit is known as the “deficit-debt adjustment” 
(DDA) or, more generally, as the “stock-flow adjustment”. The DDA measures the part 
of the change in debt that is not accounted for by the deficit/surplus. As long as the 
components of the DDA are sound, the difference between the change in debt and the 
deficit is explained and does not raise concerns over data quality. A positive DDA 
means that the increase in debt exceeds the deficit or that the reduction in debt is 
lower than the surplus. A negative DDA means that the decrease in debt is smaller 
than the surplus or that the debt has decreased despite a deficit. 

The DDA can be divided into three main pillars: 

A. 

B. 

C. 

transactions in main financial assets; 

valuation effects and other changes in the volume of debt; 

time of recording and other differences. 

Pillar A – transactions in main financial assets comprises transactions in deposits 
held by the ministry of finance or other governmental units at the central bank and 
other monetary financial institutions (MFIs); the net acquisition of non-government 
securities by social security funds (which build up assets to cover future pension 
entitlements); and the net acquisition of equity held by government in public 
corporations. With a given deficit, government financial investment increases the 
borrowing requirement (the amount that government needs to borrow to finance its 
activities) and hence also government debt; conversely, a reduction in financial assets 
(as a result of privatisations, for instance), tends to reduce the borrowing requirement 
and debt, while leaving the deficit unchanged. 

Pillar B – valuation effects and other changes in the volume of debt can be 
divided in three groups: 

• 

• 

the market-to-face-value adjustment; 

foreign exchange holding gains and losses; 

Government finance statistics guide 

35 

 
 
• 

other changes in the volume of debt. 

General government debt is recorded at face value (and therefore so too is the change 
in debt), whereas financial transactions in the ESA 2010 are recorded at market value 
including accrued interest. To compensate for this difference in valuation, the DDA 
includes the market-to-face-value adjustment. The adjustment applies only to 
transactions – that is, to new borrowings and repayment or buying-in of debt at prices 
which differ from nominal value (issuances and redemptions below or above par). 

The MGDD and the ESA 2010 recommend recording accrued unpaid interest under 
the instrument that generates the interest rather than under other accounts 
receivable/payable (although the ESA 2010 also allows recording in other accounts 
receivable/payable (F.8); see ESA 2010, 5.242). The accrual recording of interest 
means that the interest accruing in each period is recorded in D.41 and, if not paid, is 
viewed as being reinvested in the instrument generating the interest through an entry 
in the financial account. At the time of the actual cash payment of the interest, a 
reimbursement of the instrument is recorded. 

In the ESA 2010, the accruing of interest does not create difficulties in reconciling 
transactions and balance sheet stocks because, assuming no other events, the 
market value of the instrument increases in step with the accruing of interest (D.41). 
No entry in the revaluation account (K.7) is necessary. By contrast, because of the 
face valuation of debt, a reconciliation item is needed in GFS Table 2a, as debt does 
not increase in step with the accruing of interest (except for index-linked bonds). The 
reconciliation adjustment is entered in the item “Market-to-face-value adjustment”. 

General government debt denominated in foreign currency, unless covered using 
financial derivative contract, is valued at current exchange rates on the balance sheet 
date. The level of outstanding debt may therefore vary without any counterpart in the 
general government deficit or any transactions in foreign currency debt in the 
intervening period. Foreign exchange holding gains and losses are therefore 
another element of the DDA. General government debt covered with financial 
derivative contract is valued at the exchange rate in the financial derivative contract, 
which does not vary during the life of the contract. However, as transactions in 
financial derivatives are also part of DDA, realised exchange rate effects at time of 
redemption of the underlying of hedged debt instruments have also to be recorded in 
DDA. 

Changes in the debt related to reclassification are recorded in other changes in the 
volume of debt. These include changes in the statistical classification of units from 
the government to a non-government sector (or the reverse). Following the 
reclassification, liabilities of these units cease to be government debt, with no 
counterpart in the general government deficit. This item may also conceal statistical 
discrepancies between financial flows and the stock of debt. 

Pillar C – time of recording and other differences can be divided into the following 
categories: 

• 

time of recording differences; 

Government finance statistics guide 

36 

 
 
• 

• 

• 

transactions in monetary gold and insurance, pension and standardised 
guarantee schemes; 

transactions in financial derivatives and employee stock options; 

statistical discrepancies between financial and non-financial accounts. 

Time of recording differences refer to the difference between the recording of 
expenditure and the related payments and that of revenue and the related cash flow to 
government. For instance, expenditure is recorded upon delivery of supplies and 
hence increases the deficit, although a government may delay the actual cash 
payment (in line with contractual settlement clauses). The financial claim on the 
government owing to this timing difference is recorded under other accounts payable 
(F.8). Other accounts payable are not part of government debt for the purposes of the 
EDP. Hence, delayed payment by government for supplies does not affect the 
borrowing requirement or the debt, but delivery does increase the deficit. Similarly, 
taxes are recorded as reducing the deficit at the time that they are assessed, even 
though payment may take place somewhat later, unless a time-adjusted cash method 
is used. This delay is recorded under other accounts receivable (F.8) in the 
government accounts. The delayed payment of taxes to government does not reduce 
the borrowing requirement, although the taxes themselves decrease the deficit. Other 
time of recording differences may arise on account of the early or late reimbursement 
by the EU of the funds that the government spends on its behalf. 

For the euro area countries, government transactions in monetary gold and special 
drawing rights (SDRs) (F.1) are by definition zero after adoption of the euro, since 
euro area governments are not allowed to hold monetary gold and SDRs. Of the 
non-euro area governments, only the UK government holds monetary gold. The net 
acquisition of and net incurrence of liabilities in insurance, pension and 
standardised guarantee schemes (F.6) (items 11 and 21 respectively, Table 2a) for 
the government sector are probably negligible in terms of GDP. 

Transactions in financial derivatives and employee stock options (F.7) may 
either generate cash, thereby reducing the government borrowing requirement, or 
oblige the government to borrow more when settlements under swaps turn out to be 
negative. 

The statistical discrepancy is the difference between the deficit as measured by the 
non-financial accounts (B.9) and the deficit as measured by the financial accounts 
(B.9f). When the government has a deficit in the non-financial accounts, the equivalent 
amount should be displayed in the general government financial accounts: the 
increase in liabilities should exceed the increase in financial assets by the amount of 
the deficit. Because different sources of data are used to measure the transactions 
resulting in the two balances, B.9 and B.9f are not always equal. 

Figure 1 shows the two ways in which Table 2a reconciles the deficit and the change in 
debt. Item numbers refer to Table 2a. 

Government finance statistics guide 

37 

 
 
Figure 1 
Reconciliation of the government deficit and debt 

Deficit/surplus (minus B.9)
- item 1.A.1)

+

Pillar A

Transactions in main financial assets =

transactions in currency and deposits (item 5)

+ transactions in debt securities (item 6)
+ transactions in loans (item 7 + item 8)
+ transactions in equity and investment fund shares or units (item 9)

+

Pillar C

Time of recording and other differences

net transactions in other accounts receivable/payable (item 15 - item 27)

+ net transactions in insurance, pension and standardised guarantee schemes (item 13 - item 25)
+ net transactions in financial derivatives and employee stock options (item 14 - item 26)
+ statistical discrepancy (item 1)

=

General government borrowing requirement =
transactions in currency and deposits (item 19)
+ transactions in debt securities (item 20 + item 21)
+ transactions in loans (item 22 + item 23)

+

Valuation effects and other changes in volume of debt =

re valuation effects on debt (item 34)

+ other changes in the volume of debt (item 37)

Pillar B

=

Change in government debt
(item 38)

Source: ECB calculations. 

+

+

+

+

=

Deficit-debt adjustment
(DDA)

5.2 

Table 2a: Format and contents 

The table below shows the content and format of Reporting Table 2a used by the ECB 
to collect data from the NCBs. It shows the item numbers used in Table 2a of the GFS 
Guideline and the corresponding line numbers in Reporting Table 2a, the relationships 
between the line and item numbers, and the ESA 2010 codes. Some items in the data 
request are not included in the GFS Guideline (item 16a, item 16b, item 27a, item 27b, 
item 36a, item 36b, item 37a, item 37b, item 37c, item 40 and item 41). The rest of this 
chapter contains a description of each of the items listed in Table 2a. The transactions 
are presented net across instruments. For example, in transactions in financial assets, 
the proceeds from the liquidation of a long-term bond are deducted from the purchase 
of long-term bonds upon receipt. 

Government finance statistics guide 

38 

 
 
 
Table 2a 
Deficit debt adjustment statistics 

Guideline 
item number 
Table 2a 

Reporting table line number and 
relationships1 

ESA 2010 codes 

Description 

Adjustment between financial and 
non-financial accounts 

Net financial transactions 
(consolidated) 

Financial assets (consolidated) 

Monetary gold and special drawing 
rights (SDRs) 

Currency and deposits 

Debt securities 

Short-term loans 

Long-term loans 

Equity and investment fund shares or 
units 

  Privatisation 

  Equity injections 

  Other 

Insurance, pensions and 
standardised guarantee schemes 

Financial derivatives and employee 
stock options 

Other accounts receivable 

of which: taxes and social 
contributions 

  Taxes 

  Social contributions 

Liabilities (consolidated) 

Monetary gold and special drawing 
rights (SDRs) 

Currency and deposits 

Short-term debt securities 

Long-term debt securities 

Short-term loans 

Long-term loans 

Equity and investment fund shares or 
units 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

Insurance, pension and standardised 
guarantee schemes 

25 

Financial derivatives and employee 
stock options 

Other accounts payable 

  of which: taxes 

  of which: social contributions 

General government borrowing 
requirement (GGBR) 

  of which: long-term 

26 

27 

28 

29 

1 = [1A.1]-2 

B.9 – B.9f 

2 = 3-17 

3 = 4+5+6+7+8+9+13+14+15 

4 

5 

6 

7 

8 

9 = 10+11+12 

10 

11 

12 

13 

14 

15 

16 = 16a+16b 

16a 

16b 

17 = 
18+19+20+21+22+23+24+25+26+27 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

27a 

27b 

28 = 19+20+21+22+23 
28 = 30+31+32 
28 = 1-[1A.1]+3-18-24-25-26-27 

29 

B.9f 

F.1 

F.2 

F.31+F.32 

F.41 

F.42 

F.5 

S.13 / F.5 / (S.11001+S.12x01) / 
other than (S.11001+S.12x01)   

S.13 / F.5 / (S.11001+S.12x01) / 
(S.11001+S.12x01) 

S.13 / F.5 / other than 
(S.11001+S.12x01) 

F.6 

F.7 

F.8 

F.89 (part) 

F.89 (part) 

F.1 

F.2 

F.31 

F.32 

F.41 

F.42 

F.5 

F.6 

F.7 

F.8 

F.89 (part) 

F.89 (part) 

F.2+F.3+F.4 

Government finance statistics guide 

39 

 
 
 
 
 
 
 
 
 
 
Description 

Denominated in national currency 

Denominated in currencies of euro 
area Member States 

Denominated in other currencies 

Other flows in government debt 

Revaluation effects 

  Appreciation and depreciation of 
foreign currency debt 

  Other revaluation effects 
(differences compared with face 
value) 

Issuance and redemption above 

and below nominal value 

  Difference between interest 
accrued and paid 

Guideline 
item number 
Table 2a 

Reporting table line number and 
relationships1 

ESA 2010 codes 

30 

31 

32 

33 

34 

35 

36 

30 

31 

32 

33 = 34+37 

34 = 35+36 

35 

36 = 38-28-35-37 
36 = 36a+36b 

36a 

36b 

K 

K.7 (part) in liabilities 
AF.2+AF.3+AF.4 

Other changes in volume of debt 

37 

37 = 37a+37b+37c 

K1+K.2+K.3+K.4+K.5+K.6 in 
liabilities: AF.2+AF.3+AF.4 

  Changes in sector classification 

  Other volume changes in financial 
liabilities 

  Other statistical discrepancy 

- 

- 

- 

Change in government debt 

38 

37a 

37b 

37c 

38 = 28+33 
38 = 1-[1A.1]+3-18-24-25-26-27+33 

38 = ([3A.1] in year T) – ([3A.1] in year 
T-1) 

Memorandum items 

Net incurrence of loans granted by 
central bank 

39 

Net transactions in other accounts 
receivable/payable related to the EU 
budget 

Difference between deliveries and 
corresponding cash payment related 
to military equipment expenditure 

- 

- 

Note: 1 [x,y] refers to item number y of Table x. 

39 

40 

41 

F.4 / S.121 

F.89 

F.89 

5.3 

Line-by-line analysis of Table 2a 

Item 1: Adjustment between financial and non-financial accounts 

Item 1 equals B.9, the balance of the capital account, less B.9f, the balance of the 
financial account. In the ESA 2010, there is no conceptual reason for the difference. 
The adjustment arises only from measurement discrepancies in the sources and 
timing of information used to compile the accounts.13  It is common for the 
non-financial and financial accounts to be compiled independently and using different 
accounting or statistical documents as source data. The adjustment between financial 

13    Note that the adjustment does not derive from the difference between cash movements and national 

accounts recording on an accrual basis. Differences in timing between accrual and payment require an 
entry under other accounts receivable/payable (F.8) or, in the case of accrued interest, under the relevant 
financial instrument. They should have no impact on the statistical adjustment. 

Government finance statistics guide 

40 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                                    
and non-financial accounts is also known as the “statistical discrepancy”. The size of 
the adjustment is a significant indicator of the quality of national accounts. Its size in 
the final version of the accounts must be reasonably small if the data are to be 
considered useful. 

Item 2: Net transactions in financial assets and liabilities 

This is net lending (+)/net borrowing (-) as recorded in the financial account (B.9f). It is 
the balance of the transactions in financial assets (item 3) and transactions in liabilities 
(item 17). 

Item 3: Transactions in financial assets (consolidated) 

These are transactions in the main financial assets, i.e. currency and deposits (F.2), 
loans (F.4), debt securities (F.3), and equity and investment fund shares or units (F.5), 
as well as transactions in other financial assets, i.e. monetary gold and SDRs (F.1), 
insurance, pension and standardised guarantee schemes (F.6), financial derivatives 
and employee stock options (F.7), and other accounts receivable (F.8). All transactions 
in financial assets are recorded on a consolidated basis. 

Breakdown by instrument 

Item 4: Transactions in monetary gold and special drawing rights 

This category covers monetary gold (F.11) and special drawing rights (SDRs) (F.12). It 
includes government holdings of monetary gold and SDRs in countries where the 
government, rather than the NCB, controls the foreign exchange reserves. 

Item 5: Transactions in currency and deposits 

Currency and deposits correspond to F.2 in the ESA 2010 (assets of S.13). They 
comprise deposits of the ministry of finance and deposits held by other units of general 
government with the central bank (S.121), with other monetary financial institutions 
(S.122), and perhaps with other sectors, both domestic and abroad. All types of 
deposit are included in this item: transferable deposits, savings deposits and time 
deposits, whether in domestic or foreign currency. 

This item also includes repurchase agreements (repos) where government units lend 
cash against securities and, in the process, acquire a claim on an MFI (see ESA 2010 
5.86.f). 

Government finance statistics guide 

41 

 
 
Reverse repos (where government units deliver securities against the receipt of cash) 
do not appear under item 5 as negative deposits. They are recorded as financial 
liabilities of government in the form of loans (F.4). 

Deposits of government units with other government units (for example local 
government deposits with the ministry of finance) are consolidated. They do not 
appear under item 5 of Table 2a, but rather under item 3 of Table 3b, which shows the 
consolidating elements of the government debt. 

Accrued interest is recorded under the relevant instrument (rather than under 
accounts receivable/payable, F.8) and so contributes to the transactions in such 
assets. 

Item 6: Transactions in debt securities 

Debt securities are the ESA 2010 category F.3, covering the net acquisition of 
non-government bills, notes and bonds. F.3 includes certificates of deposit and 
commercial paper, which are money market instruments issued by financial 
institutions and non-financial corporations respectively. This item includes 
non-government bonds, notes and bills purchased primarily by social security funds, 
which in some countries have large holdings of such instruments. Transactions are 
recorded at market value, rather than at face value, and include accrued interest. 

Item 7: Transactions in short-term loans 

This item includes loans with an initial maturity of one year or less (F.41) that are 
transactions in government assets. Examples of loans are loans to public corporations 
(which are classified as S.11 or S.12, and not as S.13), loans disbursed in the context 
of social housing schemes, and loans to students. This item includes imputed 
transactions related to accruing interest. 

Item 8: Transactions in long-term loans 

This item includes loans with an initial maturity of over one year (F.42) that are 
transactions in government assets. Transactions are recorded at market value, rather 
than at face value, and include accrued interest. 

Item 9: Transactions in equity and investment fund shares or units 

Equity and investment fund shares or units are recorded in the ESA 2010 category F.5 
(government assets). In Table 2a, this category is broken down into privatisations, 
equity injections, and other transactions in equity and investment fund shares or units. 

Government finance statistics guide 

42 

 
 
Item 10: Privatisations 

Privatisation, although not an ESA 2010 category, is an important criterion for 
classification in the context of public finance analysis. Privatisation is the sale to third 
parties of government-owned shares in public corporations, such that the government 
cedes control of the corporation to the private sector. ESA 2010 2.35-2.38 defines 
control as “the ability to determine general corporate policy, for example by choosing 
appropriate directors if necessary,” involving the ownership of “more than half the 
voting shares or otherwise controlling more than half the shareholders’ voting power” 
(or sometimes having the power through legislation to determine corporate policy or to 
appoint the directors). During the early 1990s, privatisation, particularly of public utility 
businesses, became a normal practice of governments in western European 
countries. The former communist countries of eastern Europe also privatised many 
state-owned enterprises around the time of their accession to the EU. 

Not all sales of shares in public corporations are to be recorded as privatisations. For 
example, the sale by a social security fund of a share initially bought by it for 
investment purposes would not be a privatisation. 

Borderline cases might create specific difficulties. A sale of a large participation, such 
as a 20% stake in a business, even when not reducing control to less than 50% of the 
voting power, would nevertheless be seen as a privatisation if it meets one or more of 
the following conditions: 

• 

• 

• 

it is the first step of a pre-announced sale of more than 50% of the shares in the 
unit; 

it involves a clear lessening of control; 

it is part of a clear agenda to reduce government holdings. 

Similarly, a public corporation to be privatised could first be sold by the government to 
another public company (holding company). Although not formally leading to a change 
of control, this could be the first step in a pre-existing privatisation plan. Conversely, a 
sale of a 20% block in a corporation, viewed as portfolio management by a 
government unit acting primarily as an investment manager, would not be recorded 
under privatisation, but rather under item 12 (other transactions in equity and 
investment shares or units). 

Positive amounts for this item may occur in the following two cases. 

• 

• 

Nationalisation: when government purchases a corporation from the private 
sector, thus acquiring ownership of a private sector business. This is normally an 
act of policy rather than an act of investment management. 

Debt assumptions and debt cancellations in the context of a privatisation 
(ESA 2010 4.165.f). In this case, the imputed payments from government to a 
corporation, which are recorded as the counterparts to the imputed transactions 
in loans, are classified as acquisitions of equity (F.5) (and not as capital transfers, 
the usual treatment for debt cancellation and assumption). For the GFS, 

Government finance statistics guide 

43 

 
 
however, the transaction is recorded under privatisation rather than under equity 
injections since the intention is to increase the selling price when the unit is 
privatised. The net privatisation proceeds recorded in F.5 should therefore reflect 
the proceeds net of the cost of debt assumptions and cancellations. 

Privatisation proceeds are to be recorded before the deduction of commission and 
fees paid to investment banks acting on the government’s behalf as agents in the 
privatisation. The commission and fees paid are treated as purchases of services and 
are recorded as government expenditure in intermediate consumption (P.2). 

All privatisation proceeds are recorded under this item, and not solely those proceeds 
that by law, regulation or accounting device are allocated to reducing government 
debt. In practice, it is not usually possible to identify the subsequent uses of 
privatisation proceeds. 

Item 11: Equity injections 

An equity injection occurs when government acquires extra equity (F.5) in a public 
corporation through an injection of cash or in kind (a transfer of a building, for 
instance). 

Negative equity injections (equity withdrawal) would be recorded in the event of a 
lump-sum payment by a public corporation to government, when the transaction is 
viewed as a financial transaction and is not a loan repayment. Lump-sum payments to 
government that greatly exceed a public corporation’s recent profit would, in general, 
be classified as an equity withdrawal. 

Amounts received by government that relate to “indirect privatisations” (see 
Chapter III of the MGDD for more details) are generally recorded as negative equity 
injections. Indirect privatisation occurs where a public corporation, usually a holding 
company, sells assets (mainly shares and other equity) and gives the proceeds to 
government. According to the MGDD, the transfer of the proceeds is to be considered 
a withdrawal of equity from the holding company. 

Item 12: Other transactions in equity and investment fund shares or 
units 

This covers other transactions in equity and investment fund shares or units, i.e. all 
other transactions that are recorded in F.5 (government assets). It includes the 
following. 

• 

• 

Investment portfolio transactions, such as purchases by social security funds of 
shares for short-term money management or long-term investment purposes. 

Equity investments in international financial organisations where it is clear that 
these are genuine financial investments with an economic return expected. 
When no economic return is expected, the payments should be recorded as gifts 

Government finance statistics guide 

44 

 
 
(D.74 or D.92 in the non-financial accounts) even if government has a theoretical 
legal entitlement to a return of its funds. It is the economic substance that 
matters, not the legal form. 

Although well defined in principle, this category may, in practice, be compiled as a 
residual since total F.5 transactions will be available in the ESA 2010 financial 
accounts, while privatisation or equity injections may be estimated from different 
sources using slightly different methodologies. 

Item 13: Transactions in insurance, pension and standardised 
guarantee schemes 

This covers transactions in insurance, pension and standardised guarantee schemes, 
i.e. all transactions that are recorded in F.6 (government assets). It includes: 

• 

• 

• 

• 

• 

• 

non-life insurance and technical reserves; 

life insurance and annuity entitlements; 

pension entitlements; 

claims of pension funds on pension managers; 

entitlements to non-pension benefits; 

provisions for calls under standardised guarantees. 

Item 14: Transactions in financial derivatives and employee stock 
options 

This item records the net acquisition of assets in the form of financial derivatives 
contracts (F.7). It includes inflows and outflows related to purchases and sales of and 
settlements under options and warrants, margin calls on futures, and interim and 
termination payments related to all types of derivatives. However, deposits or initial 
margins placed or repaid are not recorded here, but under deposits (F.2) (or under 
loans (F.4) if government has received a margin payment which represents a liability of 
government (see ESA 2010 5.136.d)). 

The market value of swaps is usually zero at inception. Changes in the market value, 
for example owing to changes in interest rates in the case of interest swaps, are 
recorded as other flows in national accounts, increasing/decreasing the balance sheet 
position AF.71 with no transaction recorded. Settlements of financial derivatives are 
recorded in the financial accounts as a transaction in F.71 with a counterpart entry in 
currency and deposits (F.2). 

Government finance statistics guide 

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Item 15: Transactions in other accounts receivable 

This category covers other accounts receivable (F.8) by the government. 

Item 16: Of which taxes and social contributions 

These are other accounts receivable (F.8) in respect of taxes and social contributions. 
Such amounts are the difference between accrual recording of taxes and social 
contributions and their cash recording. Chapter II.2 of the MGDD explains the accrual 
recording of taxes and social contributions. 

Item 16a: Of which taxes 

These are other accounts receivable (F.8) in respect of taxes. Such amounts are the 
difference between the accrual recording of taxes and their cash recording. 

Item 16b: Of which social contributions 

These are other accounts receivable (F.8) in respect of social contributions. Such 
amounts are the difference between the accrual recording of social contributions and 
their cash recording. 

Item 17: Transactions in liabilities 

These are transactions in the ESA 2010 liabilities, i.e. monetary gold (F.11) and 
special drawing rights (F.12), currency and deposits (F.2), debt securities (F.3), loans 
(F.4), insurance, pension and standardised guarantee schemes (F.6), financial 
derivatives and employee stock options (F.7), and other accounts payable, including 
trade credits (F.8). All transactions in liabilities are recorded on a consolidated basis. 

Breakdown by instrument 

Item 18: Transactions in monetary gold and special drawing rights 

This category covers monetary gold (F.11) and special drawing rights (F.12). 

Item 19: Transactions in currency and deposits 

This item includes transactions in government liabilities classified in the ESA 2010 as 
currency (F.21), transferable deposits (F.22) or other deposits (F.29). 

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46 

 
 
Currency (F.21) comprises coins in circulation issued by government. In certain 
countries, coins are issued by the central bank rather than government and are 
therefore a central bank liability, as are banknotes. General government is unlikely to 
have liabilities in the form of transferable deposits (F.22), except perhaps to other 
government units (which would not be included here because of the consolidation of 
financial transactions), or to public sector entities classified as being outside the 
general government sector. 

Other deposits (F.29) include time deposits, savings deposits, savings books and 
savings certificates that are liabilities of government. For example, some ministries of 
finance operate savings accounts for households, perhaps managed by the postal 
service or other public agencies. This category would also include specific 
arrangements for banks or public corporations depositing cash with government. 

The borderline between deposits and loans is explained in ESA 2010 5.117-5.119. The 
distinction between transactions in loans and transactions in deposits is that a debtor 
offers a standardised non-negotiable contract in the case of a loan but not in the case 
of a deposit (ESA 2010 5.117). The ECB’s MFI balance sheet regulation14  follows a 
different convention, under which no MFI liability is a “loan” and no MFI asset is a 
“deposit”. 

This item also includes short-term liabilities in the form of repos. 

Since these transactions are derived from the ESA 2010 financial accounts, accruing 
interest on such deposits is normally recorded in the instrument category. Some 
compilers, however, include accrued interest in other accounts payable (AF.8), not in 
the underlying instrument category. The stock of government debt increases only 
when the interest is actually credited to the account. The transactions and change in 
debt are reconciled through an entry in item 32 (other valuation effects). 

Item 20: Transactions in short-term debt securities 

Item 20 covers government liabilities in the ESA 2010 category F.31. It includes bills, 
short-term notes and bonds sold with an initial maturity of one year or less. Other 
securities are classified under long-term securities (F.32) in item 21. 

Securities with an initial maturity of exactly one year are classified here. Some 
flexibility is necessary for issues of fungible securities when the initial maturity of the 
last tranche is, exceptionally, one year or less while the initial maturity of each of the 
first tranches was longer. In that case, all tranches would be classified as long-term 
instruments since it would not be possible to distinguish in the market between the 
tranches and still record transactions, other flows and stocks consistently. 

This item excludes instruments – even those called “bills” or “Treasury bills” – when 
their initial maturity exceeds one year. The ESA 2010 defines short-term as an initial 
maturity of one year or less (ESA 2010 5.A1.14). 

14    Regulation (EU) No 1071/2013 of the ECB of 24 September 2013 concerning the balance sheet of the 

monetary financial institutions sector (ECB/2013/33). 

Government finance statistics guide 

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Item 21: Transactions in long-term debt securities 

Long-term securities (F.32) include bonds, notes and Treasury bills with an initial 
maturity of more than one year. They might be issued by the ministry of finance, other 
central government agencies, state governments, local governments or social security 
funds. This item may include liabilities legally structured as bonds, even where in 
practice there may be a single creditor, such as the central bank or a special fund 
established for a public purpose. The category includes securities with reimbursement 
options (callable by either the debtor or the creditor) of more than one year at the time 
of issue. 

Long-term securities include conventional bonds issued at par, zero coupon bonds, 
deep-discounted bonds, bonds with capitalised interest, floating rate bonds, stripped 
bonds (coupon and principal split into numerous zero coupon bonds), fungible bonds 
issued in tranches, certain types of lottery bonds (although not non-tradable varieties, 
typically held by households, which are more appropriately classified as deposits), 
indexed bonds, foreign exchange bonds, and callable or puttable bonds. 

Instruments with an initial maturity of one year are not classified here, but rather as 
short-term bonds. As noted above, some flexibility is needed in the case of fungible 
bonds issued close to maturity. Securities held by other government units are 
excluded in consolidation. 

The redemption price of some securities is linked to an index such as a consumer 
price index. Chapter II.4 of the MGDD identifies two ways to account for the change in 
value of an indexed instrument. 

•  When the index is a consumer price index, the uplift in the value of the principal is 

generally small and not highly volatile. It is deemed to be interest (D.41) and is 
shown as being reinvested in the instrument in the financial account. It affects the 
GGBR if the security is a Maastricht debt instrument. There are no volume (K.5) 
or valuation (K.7) effects in other flows. The increase in the index is regarded as 
the property income received from the instrument over its life. 

•  When the index is volatile, the MGDD allows recording as other volume changes 
(K.5) and not as interest (D.41). This approach could cover liabilities indexed to 
stock prices, gold, other commodities or a currency. There is no certainty that the 
index will be higher when the bond is redeemed, and the change is not regarded 
as part of the yield. Such instruments are often a way of hedging or taking on 
risks. 

This means that the change in Maastricht debt in the form of indexed instruments will 
sometimes appear in the GGBR (item 28) and sometimes in other volume changes 
(item 37). 

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Item 22: Transactions in short-term loans 

Item 22, transactions in short-term loans, is the ESA 2010 category F.41. It covers 
short-term borrowing by government units in the form of loans with an initial maturity of 
one year or less. 

The category includes imputed transactions in loans in respect of debt assumption. 
These are recorded in the ESA 2010 financial accounts as the counterpart to the 
capital transfer recorded to reflect the implicit gift that government makes to a 
non-government unit when it agrees to assume the unit’s debt owed to a third party. 
ESA 2010 4.165.f gives a more detailed explanation of this, including cases where the 
non-government unit becomes insolvent or where debt assumption is associated with 
privatisation. The category also includes imputed loans in respect of finance leases, 
lump-sum payments received at the inception of swaps, and securitisations. 
Guarantees are regarded as contingent liabilities and are not recorded in the system 
(ESA 2010 7.31) except when they are traded. 

Item 23: Transactions in long-term loans 

This item records transactions in long-term loans (F.42), i.e. loans with initial maturity 
over one year. The category includes imputed transactions in loans in respect of debt 
assumption. These are recorded in the ESA 2010 financial accounts as the 
counterpart to the capital transfer recorded to reflect the implicit gift that government 
makes to a non-government unit when it agrees to assume the unit’s debt owed to a 
third party. ESA 2010 4.165.f gives a more detailed explanation of this, including cases 
where the non-government unit becomes insolvent or where debt assumption is 
associated with privatisation. The category also includes imputed loans in respect of 
finance leases, lump-sum payments received at the inception of swaps, and 
securitisations. Guarantees are regarded as contingent liabilities and are not recorded 
in the system (ESA 2010 7.31) except when they are traded. 

Item 24: Transactions in equity and investment fund shares or units 

This item records the net incurrence of liabilities of equity and investment fund shares 
or units (F.5). See also item 9. 

Item 25: Transactions in insurance, pension and standardised 
guarantee schemes 

This item records the net incurrence of liabilities in the form of insurance, pension and 
standardised guarantees (F.6). See also item 13. 

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Item 26: Transactions in financial derivatives 

This item records the net incurrence of liabilities in the form of financial derivatives 
contracts (F.7). See also item 14. 

Item 27: Transactions in other accounts payable 

This category covers transactions related to other accounts payable (F.8) by 
government. 

Item 27a: Of which taxes 

These are other accounts payable (F.8) in respect of taxes. They can arise due to 
payments by taxpayers exceeding their tax liability. 

Item 27b: Of which social contributions 

These are other accounts payable (F.8) in respect of social contributions. 

Item 28: General government borrowing requirement 

The general government borrowing requirement (GGBR) covers all financial 
transactions in Maastricht debt instruments (currency and deposits (F.2), debt 
securities (F.3) and loans (F.4)). It is sometimes called “transactions in government 
debt”, “Maastricht debt transactions” or “transactions in Maastricht debt”. 

The GGBR is shown consolidated. For example, if central government issues bonds 
that are all bought by social security funds, there is no impact on the GGBR, but it is 
reported under item 10 of Table 3b, which shows the consolidating elements of the 
government debt. 

Item 29: Transactions in long-term debt instruments 

This item includes all Maastricht debt instruments with an initial maturity of more than 
one year. Initial maturity is the maturity at issue, which is also frequently referred to as 
“original maturity”. 

Breakdown by currency 

The breakdown of transactions by currency indicates the exposure of government to 
changes in exchange rates. The compilation of transactions is often based on 

Government finance statistics guide 

50 

 
 
estimates of the stock of debt in a given currency and the change in value of that 
currency over an accounting period. 

Item 30: Denominated in national currency 

For Member States in the euro area, this means the euro or the national currency it 
replaced. For EU Member States outside the euro area, it means the (national) 
currency that is legal tender. 

Item 31: Denominated in currencies of euro area member states 

This item covers instruments denominated in currencies of countries participating in 
the euro area before they joined the euro area, other than the relevant domestic 
currency. It includes the European Currency Unit (ECU). For EU Member States that 
have not yet adopted the euro, this item includes euro-denominated debt. 

Item 32: Denominated in other currencies 

This item covers instruments denominated in currencies of EU Member States outside 
the euro area, such as the British pound sterling, and also those in (for example) US 
dollars, Swiss francs and Japanese yen. 

Item 33: Other flows in government debt 

Items 33 to 37 account for the difference between transactions in government debt 
instruments, the GGBR and the change in government debt. Item 33 “Other flows” is 
simply the sum of revaluation effects (item 34) and other changes in volume (item 37). 

Item 34: Revaluation effects 

The change in government debt (item 38) is recorded at face value, while the GGBR 
(item 28) is recorded at market value. Item 34 shows the difference between the 
change in debt and the GGBR due to the different valuation methods. It is the sum of 
two valuation effects: appreciation and depreciation of foreign currency debt (item 35) 
and other revaluation effects (differences compared with face value) (item 36). 

Item 35: Appreciation and depreciation of foreign currency debt 

This is the increase (+) or decrease (-) in the face value of government debt 
instruments due to exchange rate movements, recorded in the ESA 2010 financial 
accounts within the other flow category for nominal holding gains/losses (K.7). Item 35 

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encompasses effects of exchange rate movements on debt denominated in foreign 
currency. General government debt covered forward is valued at the exchange rate in 
the forward contract, which does not vary during the life of the contract. As 
transactions in financial derivatives are also part of DDA, realised exchange rate 
effects at time of redemption of the underlying of hedged debt instruments have also to 
be recorded under item 35. Possible effects of swaps used for hedging foreign 
currency debt have to be recorded within transactions in financial derivatives (items 14 
and 26). “Net increase” in item 35 means the increases less the decreases in value 
due to such movements and changes. 

These foreign exchange holding gains and losses can apply to all instruments: 
deposits, loans, short-term securities and long-term securities. They are recorded on a 
consolidated basis and so do not include changes in the value of government liabilities 
denominated in foreign currency that are held as assets by other units in the general 
government sector. 

When sources of information are primarily balance sheets (stocks), estimates of the 
holding gains and losses must be made on the basis of the currency composition of 
the debt. The difference between a) transactions in foreign currency debt at face value 
(comprising new borrowings and repayment or buying-in of foreign currency debt), 
converted into national currency at the exchange rate at the time of transaction, and b) 
the change in stocks at face value in foreign currency terms but converted into national 
currency at the exchange rate on the balance sheet date, after allowing for any 
reclassification or other exceptional volume changes, would be recorded as holding 
gains or losses. 

Item 36: Other revaluation effects (differences compared with face 
value) 

This item is the “market-to-face-value adjustment” which was introduced in 
paragraph 5.10. It recognises that transactions in government debt instruments 
recorded at market value in the ESA 2010 financial accounts will differ from 
transactions in government debt recorded at face value. To reconcile their 
movements, it is necessary that both transactions and other flows are at face value. 

For example, a bond issued at a discount will increase the ESA 2010 balance sheet 
debt by the discounted price (since that is the market price), but will increase 
government debt by the full face value. 

The accounting identity is as follows: item 36 = face value less market price. 

The ESA 2010 balance sheet is also affected by the addition of accrued unpaid 
interest in the financial account. Transactions in government debt instruments include 
amounts for accruing interest, both for interest accruing in D.41 in the non-financial 
account with its counterpart in the relevant financial instrument, and as regards 
transactions in financial instruments whose traded prices take account of accrued 
interest. The stock of government debt is valued at face value and so does not include 
accrued interest (except for certain indexed instruments). 

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Item 36 records the adjustments needed for consolidated financial transactions. 

The market-to-face-value adjustment 

Gross issuance: face value less market value (A) 

Gross redemption: face value less market value (B) 

Accrual of interest: interest payable less interest paid15  (C) 

Exchange of debt (D) 

= 

- 

+ 

+ 

A. Gross issuance 

Premium and discounts at issue 

For example, a zero coupon bond with a redemption price of 100 (face value) issued at 
80 is recorded (at issue) as follows: 

Transaction in bonds 

Change in Maastricht debt 

Market-to-face-value adjustment   

+80 

+100 

+20 

The treatment is similar for all bonds not issued at face value. Other bonds include 
deep-discounted bonds, bonds with small discounts and bonds issued at a premium. 
In the last case, a negative entry is shown in item 36a. 

Accrued interest sold at issue 

Accrued interest is sometimes sold at issue, e.g. in the case of fungible tranches of 
linear bonds. Since accrued interest is not part of Maastricht debt, an adjustment is 
necessary. For example, suppose a 6% coupon bond with a face value of 100 pays a 
coupon on 1 September and is issued on 1 June at par. The selling price will be 104.5, 
of which 4.5 represents accrued interest. 

Transaction in bonds 

Change in Maastricht debt   

+104.5 

+100.0 

Market-to-face-value adjustment   

-4.5 

Now consider a bond, denominated in dollars, with a face value of 100. Suppose the 
euro falls from 1 dollar = 0.65 euro at the beginning of the year to 1 dollar = 0.70 euro 
at the end of the year. The face value of the bond (in euro) rises from 65 to 70, an 
increase of 5. This increase will be recorded in item 34. Any interest accrued during 
the year that remains unpaid is recorded in the financial accounts as a reinvestment in 
the bond and is therefore part of the borrowing requirement (item 28). Since the 

15    Except for index-linked instruments, where index linking is reflected in EDP debt. 

Government finance statistics guide 

53 

 
 
 
 
 
 
 
 
 
 
 
 
                                                                    
nominal value of the bond does not include interest accrued but not yet paid, the 
amount of accrued but unpaid interest will appear with a minus sign in item 36. 

B. Gross redemption 

In general, redemption at maturity is, by definition, at face value, so no adjustment is 
needed. For early redemption, item 36 equals the price paid to redeem the securities 
(the financial transaction recorded under the ESA 2010) less the face value. 

C. Accrual of interest 

Because interest (D.41) is recorded on an accrual basis, premia and discounts are 
amortised over time, giving rise to transactions in the instrument that do not affect the 
face value of the outstanding debt. Consider a 10-year bond, with a coupon paying 6% 
interest, issued at 90 and with a face value of 100. Assume linear amortisation of the 
discount of 10. Each year, the following would be recorded: 

Interest accrued (D.41) 

(coupon plus amortisation) 

Interest actually paid 

Transaction in bonds (F.3) 

Change in Maastricht debt 

Market-to-face-value adjustment   

D. Exchange of debt 

+7 

+6 

+1 

0 

-1 

An exchange of debt is the early redemption of old debt and the issuance of new debt 
of equivalent market value. The face value of the old and new debts may differ. This 
difference is not entered in the general borrowing requirement (which is recorded at 
market value), but it does change Maastricht debt. The recording of early redemption 
and new issuance would be as described above. 

Note that governments can reduce their debt by redeeming low coupon bonds and 
issuing high coupon bonds of the same market value. However, for instruments close 
to maturity, this would mean higher interest payments, which would increase the deficit 
in the following years. 

Item 36a: Issuance and redemption above and below nominal value 

This item is the part of the “market-to-face-value adjustment”, which occurs when the 
issuance or redemption of debt at the market price differs from the face value. This 

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54 

 
 
 
 
 
 
 
 
information may be calculated by adding the issuances above (-)/below (+) nominal 
value and the redemptions of debt above (+)/below (-) nominal value. This also 
includes the exchange of debt as explained above. This information is also available 
through the EDP notification. 

Item 36b: Difference between interest accrued and paid 

This item includes the adjustment for difference between the accrued and paid 
interest, as explained in item 36 (C Accrual of interest). 

Item 37: Other changes in volume 

This item concerns all changes in stocks of government debt instruments that do not 
relate to (consolidated) transactions or (consolidated) valuation effects. The changes 
correspond to the ESA 2010 categories K1, K2, K.3, K.4, K.5 and K.6, at nominal 
value. In practice, this item is mostly a result of the reclassification of units between 
sectors (and, more rarely, of the reclassification of instruments). Statistical 
discrepancies may also contribute to this item. 

Item 37a: Changes in sector classification 

This item is the part of other changes in volume of debt that is due to the 
reclassification of units between general government and other sectors. This 
information is also available through the EDP notification. 

Item 37b: Other volume changes in financial liabilities 

This item is the part of other changes in the volume of debt that is due to the other 
volume changes in financial liabilities comprising Maastricht debt, for example, 
reclassification of instruments from Maastricht debt to non-Maastricht debt 
instruments (or vice versa). This information is also available through the EDP 
notification. 

Item 37c: Other statistical discrepancy 

This is the statistical discrepancy that may occur due to different compilation practices 
and data sources between the financial accounts transactions and other flows in 
government debt, and the government debt. In theory, the sum of transactions in 
government debt (GGBR, item 28) and the other flows and the change in government 
debt should be aligned, but in practice a statistical discrepancy between these items 
may exist and should be reported in this item. 

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Item 38: Change in government debt 

This equals the sum of transactions in government debt (GGBR, item 28) and of other 
flows in government debt (item 33). It also equals the government debt at the end of 
the year less the government debt at the end of the previous year, as recorded in GFS 
Tables 3a and 3b. 

Any unexplained residual arising from the two methods of measuring the change in 
debt should be added to item 37 (other volume changes) to ensure consistency. The 
amount added should also be reported in item 37c (other statistical discrepancy). 

Item 39: Net incurrence of loans granted by central bank (memo 
item) 

This item comprises loans (F.4) provided by the NCB to government (usually the 
ministry of finance). Since the Maastricht Treaty rules prohibit financing of government 
by the NCBs, the value of the transactions is expected to be zero (no incurrence of 
new liabilities) or negative (redemption of existing loans). Chapter 6 describes the 
prohibition on monetary financing in more detail. 

Item 40: Net transactions in other accounts receivable/payable 
related to the EU budget (memo item) 

This category is equal to transactions in other accounts receivable (F.8) related to the 
EU budget less transactions in other accounts payable (F.8) related to the EU budget. 
It includes advances received from the EU budget less prepayments made by 
government on behalf of the EU budget. Information on these transactions can be 
found in the EDP-related questionnaire that Member States are required to report to 
Eurostat along with the EDP notification tables. 

Item 41: Difference between deliveries and corresponding cash 
payments related to military equipment expenditure (memo item) 

Military equipment expenditure is to be recorded as expenditure in national accounts 
at the time of delivery. The corresponding cash payments may be made at a different 
point in time (either before or after delivery of the equipment). If cash payments occur 
before the delivery, the sign of this series is positive, as government acquires a 
financial asset (other accounts receivable, F.8). Conversely, if the delivery pre-dates 
the payment, the sign of this series is negative, as the government incurs a liability 
(recorded under other accounts payable, F.8). Information on the delivery of military 
equipment and the corresponding cash payments can be found in the EDP-related 
questionnaire that Member States are required to report to Eurostat along with the 
EDP notification tables. 

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6 

Government Debt (Table 3a) 

6.1 

Introduction to Table 3a 

This table analyses the stock of Maastricht debt, which is defined as “general 
government gross debt” in Council Regulation (EC) No 479/2009 as amended by 
Commission Regulation (EU) No 220/2014. Table 3a shows the stock of debt at a 
point in time (year-end). 

Article 1(5) of Council Regulation (EC) No 479/2009 as amended by Commission 
Regulation (EU) No 220/2014 defines general government gross debt as: 

• 

• 

the consolidated liabilities of the ESA 2010 general government sector (S.13); 

in the ESA 2010 categories: currency and deposits (AF.2), debt securities (AF.3) 
and loans (AF.4); 

•  measured at “nominal value”, further defined in the regulation as “face value” – 
this means, in particular, that government debt is not affected by changes in 
market interest rates and excludes unpaid accrued interest. 

Note that Maastricht debt excludes two types of government liability, as follows. 

• 

Certain ESA 2010 liabilities: 

• 

• 

• 

• 

• 

financial derivatives and employee stock options (AF.7); 

insurance, pension and standardised guarantee schemes (AF.6); 

equity and investment fund shares/units (AF.5); 

other accounts payable (AF.8) including trade credits and advances (AF.81) 
originating from delayed payments to providers of goods and services; 

accrued interest, whether recorded with the underlying instrument or 
recorded in other accounts payable (AF.8). 

• 

Liabilities recognised by some accounting systems but not by the ESA 2010: 

• 

• 

• 

provisions for expected but uncertain future payments arising from past 
events; 

contingent liabilities, including pension entitlements under unfunded 
government defined-benefit employer pension schemes or social security 
pension funds; 

liabilities of entities regarded as government subsidiaries in other 
accounting systems but outside the general government sector in national 
accounts. 

Government finance statistics guide 

57 

 
 
Instruments can be measured in several ways. The following approaches are 
discussed below: market value, transaction value, issue value, redemption value, 
nominal value and face value. 

• 

• 

• 

• 

• 

• 

The market value corresponds to the quoted price of instruments, representing 
the price a purchaser or a seller can expect to pay or receive at that time 
(excluding commission, fees and taxes (ESA 2010 7.38)). It includes accrued 
interest. It is the value used in the ESA 2010 balance sheets (ESA 2010 
7.33-7.35). This value is relevant both for the debtor, as the opportunity cost for 
the issuer to settle its debt early by buying it back on the secondary market, and 
for the creditor. 

The transaction value is usually close to the market value at the time of the 
transaction. Nevertheless, the ESA 2010 indicates that the transaction value is a 
concept different from the market value (ESA 2010 5.21) because the former is 
defined as the value corresponding to the actual payment for each transaction, 
which may differ slightly from the quoted value at the same time (and differ more 
substantially from a “closing price”). When the difference between the agreed 
contract price and the market price is large enough to suggest that the 
transaction has a “gift” component, the transaction is recorded at market value 
and the difference versus the contract price recorded as a transfer (D.7 or D.9) 
(see ESA 2010 5.21). 

The issue value is the transaction value at the time of issue of a financial 
instrument and represents nominal value plus the issue premium (ESA 2010 
5.155). The issue value is relevant for the debtor since it represents the amount 
of funds received initially from the incurrence of the liability. 

The redemption value corresponds to the final payment on an instrument when it 
is repaid at maturity. Redemption value is relevant both for the debtor, as the 
amount repayable at the end of the contract, and for the creditor. 

The nominal value reflects the sum of funds originally advanced, plus any 
subsequent advances, less any repayments, plus any accrued interest. Nominal 
value is not the same as face value (ESA 2010 7.39). It refers to a value that does 
not change in response to changes in market yields. 

Face value is defined as the undiscounted amount of principal to be repaid at 
maturity (IMF Public Sector Debt Statistics: Guide for Compilers and Users – 
2013 2.121). 

Article 1(5) of Council Regulation (EC) No 479/2009 as amended by Commission 
Regulation (EU) No 220/2014 stipulates that government debt is to be recorded at 
nominal value. For the purposes of this regulation, nominal value is defined as the face 
value, i.e. the (contractually agreed) amount that the government will repay to 
creditors at maturity. The regulation develops or modifies the notion of nominal (or 
face) value in three specific cases: 

Government finance statistics guide 

58 

 
 
• 

• 

• 

for an indexed-linked liability, the nominal value “corresponds to its face value 
adjusted by the index-related change in the value of the principal accrued to the 
end of the year”; 

foreign currency-denominated liabilities are converted into domestic currency at 
the market exchange rate at the end of each accounting period; 

liabilities denominated in foreign (or even domestic) currency that are exchanged 
or swapped for another currency, including the domestic currency, are converted 
at the rate stipulated in the contract, and not at the current market exchange rate. 

Chapter VIII.2 of the MGDD gives additional guidance for specific instruments, as 
below: 

• 

• 

• 

• 

• 

• 

• 

• 

deposits (including non-negotiable notes): the nominal (or face) value includes 
interest accrued when it is actually credited to the holder (as a result of a legal 
obligation) and is available for withdrawal; 

index-linked bonds: the nominal value corresponds to the face value adjusted by 
the index-related capital uplift accrued to the end of the year; 

zero coupon bonds: the nominal value is the redemption value (face value); 

bonds with capitalised interest: the nominal value is the issue value (face value, 
but not the same as redemption value); 

stripped bonds: stripping of coupon and principal does not modify the nominal 
value of the original bond; 

financial leasing: debt includes the imputed loan equal to the gross fixed capital 
formation under financial leasing; 

if a securitisation cannot be recorded as a sale of assets in national accounts, 
debt includes the amount paid by the special-purpose vehicle (SPV) to 
government at inception of the securitisation; 

debt includes the market value for the off-market (non-zero value) swaps at the 
inception of swap contracts.16 

The treatment of securities lending and repos is clarified in the ESA 2010 (5.86.f, 
5.126-5.133). Securities delivered in the context of repurchase agreements (“repos”) 
or securities lending remain on the balance sheet of the assignor and do not appear on 
the balance sheet of the assignee. This is because repos are treated as a form of 
collateralised lending. They are recorded as transactions in loans or deposits and not 
in the underlying instrument, which is regarded as being retained by the assignor. 
Thus, in the breakdown by holder of government debt in GFS, securities received 
under a repo (or a securities lending transaction) and subsequently sold outright by 
the assignee are recorded as a negative holding of securities by the assignee. Since 
both the assignor and the final purchaser record the security in their balance sheets, 

16    Guidance on swaps is available in the government finance statistics section of the Eurostat website. 

Government finance statistics guide 

59 

 
 
                                                                    
total holdings of the asset do not change. The treatment specified in the ESA 2010 for 
securities lending and repos is applicable only where the original seller of the asset 
has a firm commitment to repurchasing it under conditions agreed at the outset. GFS 
follow the same rules. 

6.2 

Table 3a: Format and contents 

The table below presents the format and contents of Reporting Table 3a used by the 
ECB to collect GFS data from NCBs. The table shows the item numbers used in 
Table 3a of the GFS Guideline, which are the same as the line numbers in Reporting 
Table 3a, and the relationship with the ESA 2010 codes. The table shows several 
breakdowns of Maastricht debt: by instrument, holder, currency and maturity. 

ESA 2010 codes 

F.2+ F.31+F32+ F.41+F.42 

F.2 

F.31 

F.32 

F.41 

F.42 

S.121 

S.122+S.123 

S.124+S.125+S.126+S.127+S.128+S.129 

S.11+S.14+S.15 

S.2 

Table 3a 
Government debt 

Description 

Guideline item 
number Table 3a 

Reporting table line 
number and relationships 

Government debt (consolidated) 

1 

Currency and deposits 

Short-term securities 

Long-term securities 

Short-term loans 

Long-term loans 

Held by residents of the Member 
State 

  Central bank 

  Other monetary financial 
institutions 

  Other financial institutions 

  Other residents 

Held by non-residents of the 
Member State 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

  held by non-residents inside 

the euro area 

  held by non-residents outside 

the euro area 

Denominated in national currency  13 

Denominated in currencies of 
euro area Member States 

14 

Denominated in other currencies 

15 

Short-term debt 

Long-term debt 

16 

17 

  of which: variable interest rate 

18 

Residual maturity up to one year 

19 

Residual maturity over one and 
up to five years 

20 

  of which: variable interest rate 

21 

1 = 2+3+4+5+6 
1 = 7+12 
1 = 13+14+15 
1 = 16+17 
1 = 19+20+22 

2 

3 

4 

5 

6 

7 = 8+9+10+11 

8 

9 

10 

11 

12= 1-7 
12 = 12a+12b 

12a 

12b 

13 

14 

15 

16 

17 

18 

19 

20 

21 

Government finance statistics guide 

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Description 

Guideline item 
number Table 3a 

Reporting table line 
number and relationships 

ESA 2010 codes 

Residual maturity over five years 

22 

  of which: variable interest rate 

23 

Memorandum items 

Average residual maturity of debt  24 

Government debt – zero coupon 
bonds (redemption value) 

25 

Government debt – loans granted 
by central bank 

26 

Government debt with residual 
maturity over one year 

Trade credits and advances 
(consolidated) 

22 

23 

24 

25 

26 

27 = 20+22 

28 

6.3 

Line-by-line analysis of Table 3a 

Item 1: Government debt (consolidated) 

This is the general government gross consolidated debt at face value. It is the sum of 
the consolidated Maastricht debt instruments. It excludes any government debt held 
as a financial asset by government units. 

Breakdown by instrument 

Item 2: Currency and deposits 

This item corresponds to liabilities of general government in currency (F.21), 
transferable deposits (F.22) and other deposits (F.29). Chapter 5 describes 
transactions in these instruments that are government liabilities under item 19. 

Coins issued by government, as in most European countries, are a government 
liability. If coins are issued by the central bank, they are a liability of the central bank. 
Banknotes are also a central bank liability. Coins physically held by central banks on 
behalf of government, and so not in circulation, are not counted as financial liabilities. 
Coins held by government units are not counted because of the consolidation rules. 

Deposits held at the ministry of finance by local government or any other part of 
general government are not included because of the consolidation rules. However, 
such deposits held by public sector entities (for example, public corporations) 
classified as being outside the general government sector (S.13) are included in this 
item. 

Government finance statistics guide 

61 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This category may include liabilities in the form of repos. It excludes accrued interest 
because of the face value rule, but capitalised interest on deposits is recorded when it 
is added to the account. 

Item 3: Short-term debt securities 

This item includes bills and other short-term notes and bonds with an initial maturity of 
up to one year, issued predominantly by the ministry of finance (classified as F.31 in 
the ESA 2010). More information on short-term debt securities is given in Chapter 5 
under item 20. 

The face value rule means that instruments that pay no coupon interest, such as zero 
coupon bonds, are recorded in Maastricht debt at the full redemption value. Coupon 
instruments are also measured at redemption value. Accrued interest is excluded from 
Maastricht debt. 

Securities held by other government units are excluded under the consolidation rules. 

Item 4: Long-term debt securities 

The long-term debt securities (F.32) item covers all types of securities with an initial 
maturity of more than one year. More information on long-term debt securities is given 
in Chapter 5 under item 21. 

The redemption price of some securities is linked to an index such as a consumer 
price index. Council Regulation (EC) 479/2009 as amended by Commission 
Regulation (EU) No 220/2014 states that the face value of an index-linked liability 
includes the index-related change in the value of the principal accrued to the end of 
the year. Any change in the value of the principal (assumed to be the basis for 
determination of the coupons) will be reflected in Maastricht debt. 

Item 5: Short-term loans 

This item covers loans to government with initial maturity of one year or less classified 
as F.41 in national accounts. All units can grant loans, such as MFIs, other financial 
intermediaries, non-financial corporations and units resident in other economies. This 
item includes syndicated loans. Loans granted by other government units are 
excluded under the consolidation rules. Overdraft facilities with MFIs (other than the 
central bank) are recorded here when used. Unused facilities are not recorded. More 
information on short-term loans is given in Chapter 5 under item 22. 

Government finance statistics guide 

62 

 
 
Item 6: Long-term loans 

This item is similar to item 5 (short-term loans) but with an initial maturity over one 
year, classified as F.42 in national accounts. More information on long-term loans is 
given in Chapter 5 under item 23. 

Imputed loans in respect of finance leases and other imputed loans are included in 
Maastricht debt in this item. Also included in this item are lump-sum payments 
received at the inception of swap contracts, along with proceeds from securitisations 
that are not deemed a sale in national accounts. 

Breakdown by holder/creditor 

Item 7: Held by residents of the Member State 

This is the debt held by residents of the Member State. It is calculated as the sum of 
the debt held by the central bank (item 8), the debt held by other monetary financial 
institutions (item 9), the debt held by other financial institutions (item 10) and the debt 
held by other residents (item 11). 

Item 8: Central bank 

This item covers all government debt instruments held by the NCB (ESA 2010 
category S.121). It includes: 

• 

• 

• 

• 

loans, including short-term loans, and overdraft facilities established before 1994 
or before adoption of the euro; 

notional claims under other deposits (AF.29) in relation to the issuance of coins 
by the general government; 

deposits made by the NCB at the ministry of finance before 1994; 

government debt securities (acquired in the secondary market) held by the NCB. 

This item excludes other financial links, sometimes substantial, between central banks 
and government, such as other accounts payable/receivable (F.8) arising when the 
central bank processes banking orders made daily by the ministry of finance. 

It excludes government securities received by NCBs in connection with repos 
extended by central banks to MFIs – often as part of the refinancing operations of the 
Eurosystem.17 

17    The Eurosystem comprises the ECB and the NCBs of those countries that have adopted the euro. 

Government finance statistics guide 

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Item 9: Other monetary financial institutions 

This item covers all elements of Maastricht debt held by domestic MFIs other than the 
NCB. Other MFIs form the ESA 2010 sub-sectors S.122 and S.123 (ESA 2010 2.68). 
They include both public (government-owned or controlled) and private institutions. 
The ECB defines other MFIs as resident credit institutions as defined in Community 
law, or other resident financial institutions whose business is to receive deposits 
and/or close substitutes for deposits from entities other than MFIs and, for their own 
account (at least in economic terms), to grant credits and/or make investments in 
securities.18 

Government liabilities held by other MFIs may include: 

• 

• 

• 

deposits at the ministry of finance; 

short-term and long-term loans extended to government units; 

debt securities issued by government units and held by MFIs other than NCBs. 

This item excludes: 

• 

• 

• 

• 

debt securities issued by governments of other countries and held by domestic 
MFIs, and any loans made by them to, or deposits placed by them with, 
governments abroad; 

government debt securities borrowed or received (by banks) in the context of 
repos or bond lending/borrowing operations; 

liabilities in the form of derivatives, e.g. options issued by government and 
bought by MFIs, or swaps with negative market value (i.e. liabilities of 
government); 

other instruments not included in Maastricht debt. 

Item 10: Other financial institutions 

The other (non-monetary) financial institutions category includes the following. 

• 

Non-money market fund (MMF) investment funds (S.124). 

•  Other financial intermediaries, except insurance corporations and pension funds 

(S.125). 

• 

Financial auxiliaries (S.126) providing services closely linked to financial 
intermediation without undertaking financial intermediation themselves. They 
include supervisory bodies, fund managers and brokers. In contrast to financial 
intermediaries, auxiliaries do not place themselves at risk by acquiring financial 

18    Regulation (EU) No 1071/2013 of the ECB of 24 September 2013 concerning the balance sheet of the 

monetary financial institutions sector (ECB/2013/33). 

Government finance statistics guide 

64 

 
 
                                                                    
• 

• 

assets and incurring liabilities on their own account (ESA 2010 2.33) and so, by 
definition, are not likely to hold significant government liabilities. 

Captive financial institutions and money lenders (S.127). These are units not 
engaged in either financial intermediation or the provision of financial auxiliary 
services, most of whose assets or liabilities are not transacted on open markets. 

Insurance corporations (S.128) and pension funds (S.129). These often have 
large holdings of government bonds. In some cases, these institutions are 
required by law to hold a minimum proportion of their portfolios as government 
bonds. 

Item 11: Other residents 

Other residents comprise: 

• 

• 

• 

non-financial corporations (S.11); 

households (S.14); 

NPISHs (S.15). 

Other residents exclude general government (S.13) because government debt is 
presented on a consolidated basis. 

In addition to their claims on general government in the form of coins, households in 
some countries hold significant deposits (AF.2) directly with the ministry of finance or 
the post office (the latter being rerouted in national accounts to represent a liability of 
central government). These deposits are mostly of a monetary nature and are 
reported accordingly to the ECB in the context of monetary statistics. The larger part of 
government debt held by households is usually in the form of non-tradable 
government bonds or other instruments issued in small denominations and sometimes 
specifically targeted at the general public. Households may also have substantial 
holdings of marketable government debt. Holdings held indirectly via investment funds 
or other vehicles are not recorded here, but rather as holdings of the financial 
intermediaries concerned. 

Non-financial corporations and NPISHs may also hold liquid assets in the form of 
government securities and hold claims on general government in the form of deposits 
(AF.2) or loans (AF.4). Their claims on general government in the form of other 
accounts receivable (AF.8) are excluded from Maastricht debt, as are any claims on 
general government in the form of financial derivatives (AF.7). 

Item 12: Held by non-residents of the member state 

This item covers the general government debt held by units of the rest of the world 
(S.2 in the ESA 2010). In the ESA 2010, this is split between “the European Union” 
(S.21) and “non-member countries and international organisations” (S.22). The former 

Government finance statistics guide 

65 

 
 
is divided further into “the Member States of the EU” (S.211) and “the institutions of the 
EU” (S.212). There is no “euro area Member States” category in the ESA 2010. 

This item covers: 

• 

• 

• 

• 

holdings of securities by non-residents; 

loans granted by non-resident institutions (such as euro-syndicated credit), 
including loans granted by the European Investment Bank (EIB); 

deposits by non-resident institutions (mostly non-resident banks) with 
government, particularly ministries of finance – this includes deposits by other 
governments, notably of other EU Member States in the context of extended 
cooperation between ministries of finance on the timing of treasury bill issuance; 

Debt issued by the domestic government and held by a government unit of 
another country, possibly both in the euro area, e.g. German Bund holdings of a 
Finnish social security fund. 

Item 12a: Held by non-residents inside the euro area 

This item covers the general government debt held by units of the rest of the world 
(S.2 in the ESA 2010) that are residents of the euro area. 

Item 12b: Held by non-residents outside the euro area 

This item covers the general government debt held by units of the rest of the world 
(S.2 in the ESA 2010) that are not residents of the euro area. 

Items 12a and 12b are not part of the Guideline, but are voluntary items in Reporting 
Table 3a. 

Currency denomination 

Item 13: Denominated in national currency 

This includes all elements of Maastricht debt denominated in the currency that is the 
legal tender of the Member State concerned in the year to which the data refer. This 
would be the euro for a euro area country, either from the time of the establishment of 
the euro area or from the time the Member State adopted the euro. 

This item includes liabilities denominated in foreign currency and exchanged through 
contractual agreement into the national currency. The amount recorded is the face 
value expressed in foreign currency converted at the rate agreed in the contract. 

Government finance statistics guide 

66 

 
 
It excludes liabilities denominated in national currency but subsequently exchanged 
through contractual agreement into a foreign currency. In that case, the liability is 
entered under the relevant item of the breakdown by foreign currency (item 14 or 15). 

Item 14: Denominated in currencies of euro area Member States 

This comprises Maastricht debt in a foreign currency that was legal tender in a country 
now part of the euro area. It includes the ECU before 1999. 

By convention, this entry is zero for the years after the country in whose currency the 
debt is denominated joined the euro area, irrespective of whether each liability has 
been legally or technically converted into euro. For the years after 1999, it includes the 
euro for countries that were (or still are) outside the euro area in the year to which the 
figures relate. 

This item includes liabilities that have subsequently been exchanged through 
contractual agreement into a currency of a euro area Member State. This item 
excludes liabilities in a currency of a euro area Member State that have been 
exchanged through contractual agreement into a national or other foreign currency. 

Item 15: Denominated in other currencies 

This item comprises all elements of Maastricht debt denominated in currencies other 
than the national currency, the euro, the ECU or the currency that was legal tender in a 
euro area country before it adopted the euro. It includes, for example, debt 
denominated in pounds sterling (except for the UK, for which it is the national 
currency), the Swiss franc, the US dollar and the Japanese yen. 

The item includes liabilities that have been exchanged through contractual agreement 
into a currency other than the national currency or a currency of a euro area Member 
State. This item excludes liabilities that have been exchanged through contractual 
agreement into the national currency or into a currency of a euro area Member State. 

Maturity of Maastricht debt 

Initial maturity is the length of life of an instrument when first issued. 

Item 16: Short-term debt 

This is the total face value of all Maastricht debt instruments with an initial maturity of 
one year or less. Coins and transferable deposits are recorded under short-term debt 
because they can be redeemed at any time. 

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Item 17: Long-term debt 

This is the total face value of all Maastricht debt instruments with an initial maturity of 
over one year. 

Issues of tranches – each having one year or less maturity – of a long bond or long 
note benchmark would technically meet the short-term definition, but it is preferable for 
practical reasons to assimilate these last tranches to the others in terms of initial 
maturity. In other words, all future tranches of a bond issued with an initial maturity 
characteristic of a long-term bond would be classified as long-term, as it is generally 
not possible to identify the original tranche to which an individual security belongs. 

Some deposits, although legally redeemable at short notice, are in practice held 
long-term with incentives for holders to retain them. By contrast, other time deposits 
might legally be long-term, but can be redeemed on demand with penalties, or after a 
period of notice. In these cases, it is a matter of judgement to determine whether 
long-term or short-term best describes the nature of the instrument. 

Item 18: Of which variable interest rate 

This item covers the outstanding amount of long-term government debt with a variable 
interest rate. Variable interest rate instruments are instruments where the coupon rate 
or underlying principal is linked to an interest rate resulting in a variable nominal 
coupon payment over the life of the instrument. 

Instruments swapped are to be classified according to their post-swap characteristics. 
For example, a fixed rate instrument swapped into a floating rate instrument would be 
recorded in the variable rate instruments category. 

Breakdown of Maastricht debt by residual maturity 

Residual maturity is the duration from the reference period until the contractual 
redemption date of an instrument. Information on residual maturity gives a measure of 
the redemptions that general government will have to finance for each relevant period. 
This gross redemption amount plus the expected borrowing requirement for each 
period equals the total need for finance expected for that period. This gives a measure 
of potential liquidity risks and allows interest expenditure to be forecast in the event of 
changes in market interest rates. 

For a conventional bond, the residual maturity corresponds to the redemption maturity, 
i.e. the date of reimbursement of the principal. Some loans are redeemed gradually 
over time through regular payments comprising both interest and principal. Ideally 
these loans should be apportioned to the different residual maturity categories as if 
they were separate loans. 

Instruments with an option for early redemption can be classified according to the 
earliest date the option can be exercised (by either the issuer or the holder). 

Government finance statistics guide 

68 

 
 
Item 19: residual maturity up to one year 

This item includes: 

• 

• 

• 

all debt with an initial maturity of one year or less, such as Treasury bills; other 
paper issued on money markets, such as commercial paper; short-term loans 
such as overdrafts; deposits of up to one year; and coins; 

debts with an initial maturity of more than one year which are within a year of 
maturity; 

debts repaid on a regular basis, some of which will fall due for redemption over 
the coming year. 

Item 20: Residual maturity over one year and up to five years 

This item includes: 

• 

• 

all debt of initial maturity of more than one year, with over one to five years to 
redemption; 

for instruments with a redemption maturity of more than five years but which are 
redeemed on a regular basis, the part to be repaid between more than one and 
five years from the reporting date. 

Item 21: Of which variable interest rate 

This item covers government variable rate debt instruments with a residual maturity 
over one year and up to five years. See also item 18. 

Item 22: Residual maturity over five years 

This item comprises instruments with a residual maturity over five years. For 
instruments with a redemption maturity of more than five years but which are 
redeemed on a regular basis, the part to be repaid more than five years from the 
reporting date is recorded here. 

Item 23: Of which variable interest rate 

This item covers government variable rate debt instruments with a residual maturity 
over five years. See also item 18. 

Government finance statistics guide 

69 

 
 
Item 24: Average residual maturity of debt (memo item) 

This memorandum item is the average residual maturity (in years) weighted by the 
face value outstanding, in line with the definition used for the residual maturity 
breakdown. This measure captures, in a very simple way, various changes occurring 
in the structure of the debt. 

In practice, the average maturity of the component for securities can be compiled 
precisely, because security-by-security databases are often available. However, more 
complex calculations and estimations may be required for consolidation where precise 
data on the maturity of holdings by government units are not available. 

The average maturity of coins along with transferable deposits is, by convention, zero. 
The average maturity of deposits transferable without notice is also, by convention, 
zero unless there are incentives to retain such deposits – resulting in a longer maturity 
in practice – when a suitable average maturity should be estimated. 

The average maturity of loans takes into account the various dates associated with the 
regular reimbursement of the loan principal where regular payments of interest and 
principal are made. The average maturity of overdrafts is, by convention, zero. 

Item 25: Government debt – zero coupon bonds (memo item) 

This memorandum item is the total face value of all medium/long-term zero coupon 
instruments. The face value of a zero coupon bond is the redemption value and not its 
issue value. Zero coupon instruments are instruments where the final payment is the 
only payment over the whole life of the instrument. By convention, only “zeros” of more 
than one year are reported here, so the item excludes short-term debt. Zero coupon 
loans or deposits are also recorded here. 

Item 26: Government debt – loans granted by central bank (memo 
item) 

This item covers loans from the NCB to government (generally to the ministry of 
finance) classified as F.4 (assets of sub-sector S.121) in national accounts. In 
accordance with the Maastricht Treaty’s prohibition on lending to government by 
NCBs, all overdraft facilities granted by central banks to their governments in the EU 
Member States were discontinued by 1994. Some existing loans and overdrafts were 
converted to medium-term or long-term credit. As such, the content and pattern of this 
item changed from short-term and volatile to long-term and decreasing (new loans 
being prohibited) after 1993. 

While the Maastricht Treaty also prohibited the purchase by central banks of 
government bonds on the primary market, it did allow secondary market purchases. 
The government debt held by NCBs item (item 8 of Table 3a) can therefore differ 
substantially from loans granted by the NCB item (item 26). 

Government finance statistics guide 

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Item 27: Government debt with residual maturity over 1 year (memo 
item) 

This item comprises instruments with a residual maturity over one year. For 
instruments with a redemption maturity of more than one year but which are redeemed 
on a regular basis, the part to be repaid more than one year from the reporting date is 
recorded here. 

Item 28: Trade credits and advances (consolidated) (memo item) 

Trade credits and advances are defined in ESA 2010 paragraphs 5.233-5.239. These 
financial claims arise when payment for goods and services is not made at the time 
they are delivered. In accordance with Regulation (EU) No 220/2014, trade credits are 
excluded from the definition of government debt. This item is not part of the Guideline, 
but is a voluntary item in Reporting Table 3a for size and data quality monitoring. 

According to a Eurostat decision taken in 2012, when a supplier fully and irrevocably 
transfers its trade credit claim on government to a financial institution, the trade credit 
liability of government must be reclassified as a loan if the following two conditions are 
both met: 

• 

• 

the government unit no longer has any payment obligation to its supplier; 

the financial institution has no direct or indirect recourse against the supplier 
(transferor of the claim) if the government unit does not meet its payment 
obligations on time. 

Likewise, when a trade credit claim is restructured in such a way that its main features 
are changed, for instance by adjusting the rate of interest charged to the debtor 
government unit and/or the timing of the repayment obligations, and if the changes are 
not restricted to a simple extension of the initial maturity, the original trade credit 
should be reclassified as a loan. 

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7 

Government debt – consolidating 
elements (Table 3b) 

7.1 

Introduction to Table 3b 

Table 3b shows the reconciliation between consolidated general government debt 
(item 1 in Table 3a) and non-consolidated general government debt (item 1 in 
Table 3b). Non-consolidated general government debt includes debt issued by a 
sub-sector of general government and held in another sub-sector of general 
government, although it excludes debt held within the issuing sub-sector. In GFS, 
non-consolidated general government debt therefore equals the sum of the debt of 
each sub-sector (items 7, 11, 15 and 19). 

Table 3b suggests three possible methods used to derive the consolidating elements 
for general government debt (Table 3b, item 2). 

(a)  Adding the consolidating elements for each debt instrument (Table 3b, 

items 3, 4, 5 and 6). 

(b)  Adding the liabilities of each sub-sector that are held by another sub-sector 

(Table 3b, items 8, 9, 10, 12, 13, 14, 16, 17, 18, 20, 21, 22). 

(c)  Adding the financial assets held by a sub-sector that are liabilities of other 
general government sub-sectors (Table 3b, items 12, 16 and 20 for central 
government, items 8, 17 and 21 for state government, items 9, 13 and 22 for 
local government and items 10, 14 and 18 for social security funds). This 
third method is the one applied in the EDP reporting tables. 

Methods (b) and (c) are shown in Table B. 

Table B 
Relationships in Table 3b 

Liabilities by sub-sector 

Central 
government 

State 
government 

Local 
government 

Social security 
funds 

General 
government 

Total 

Item 7 

Item 11 

Item 15 

Item 19 

Item 1 

Financial assets by 
sub-sector1 

Central 
government 

Item 23 (memo) 

Item 12 

Item 16 

Item 20 

Items 12+16+20 

State 
government 

Local 
government 

Social security 
funds 

General 
government 

Item 8 

Item 24 (memo) 

Item 17 

Item 21 

Items 8+17+21 

Item 9 

Item 13 

Item 25 (memo) 

Item 22 

Items 9+13+22 

Item 10 

Item 14 

Item 18 

Item 26 (memo) 

Items 10+14+18 

Items 8+9+10 

Items 12+13+14 

Items 16+17+18 

Items 20+21+22 

Item 2 

1 The black cells represent intra-sub-sector holdings that are recorded in neither the non-consolidated nor the consolidated accounts. 

Government finance statistics guide 

72 

 
 
 
 
7.2 

Table 3b: Format and contents 

The table below presents the format and contents of Reporting Table 3b used by the 
ECB to collect GFS data from NCBs. The table shows the item numbers used in 
Table 3b of the GFS Guideline and the corresponding line numbers in the reporting 
table, the relationships between the line numbers and item numbers, and the 
ESA 2010 codes. 

Table 3b 
Government debt – consolidating elements 

Description 

Guideline item 
number Table 3b 

Reporting table line number and 
relationships 

ESA 2010 
codes 

Government debt (non-consolidated between 
sub-sectors) 

Consolidating elements 

Consolidating elements by category 

  Currency and deposits 

  Short-term securities 

  Long-term securities 

  Loans 

Debt issued by central government 
(consolidated) 

  Held by state government 

  Held by local government 

  Held by social security funds 

Debt issued by state government 
(consolidated) 

  Held by central government 

  Held by local government 

  Held by social security funds 

Debt issued by local government 
(consolidated) 

  Held by central government 

  Held by state government 

  Held by social security funds 

Debt issued by social security funds 
(consolidated) 

  Held by central government 

  Held by state government 

  Held by local government 

Memorandum items 

Holdings by central government of debt 
issued by central government 

Holdings by state government of debt issued 
by state government 

Holdings by local government of debt issued 
by local government 

Holdings by social security funds of debt 
issued by social security funds 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

F.2 

F.31 

F.32 

F.4 

1 = 7+11+15+19 

2 = 3+4+5+6 
2 = 8+9+10+12+13+14+16+17+18+20+21+22 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

Government finance statistics guide 

73 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7.3 

Line-by-line analysis of Table 3b 

Item 1: Government debt (non-consolidated between sub-sectors) 

Non-consolidated general government gross debt (meaning not consolidated between 
sub-sectors) is the sum of the Maastricht debt of each sub-sector (Table 3b, items 7, 
11, 15 and 19). The debt of a sub-sector for this purpose is the total of all relevant EDP 
liabilities (i.e. AF.2, AF.3 and AF.4) issued by all units in that sub-sector that are not 
assets of that sub-sector. Valuation is at face value and follows the standard rules (see 
Chapter 6). 

Item 2: Consolidating elements 

The consolidating elements of government debt comprise all government liabilities in 
the relevant instruments (AF.2, AF.3 and AF.4) held by government units outside the 
sub-sector that has the liability, stated at face value (holdings by a unit of its own debt19 
are not recorded at all in the accounts (ESA 2010, 7.92), and, as noted earlier, GFS do 
not record holdings by other units in the issuing sub-sector in the debt of that 
sub-sector.) 

The consolidating elements of government debt can be broken down into the 
ESA 2010 categories: 

• 

• 

cross-deposits between government units, in particular local government (and 
social security fund) deposits held with the ministry of finance; 

cross-lending between government units, in particular central government loans 
to local government (and social security funds) to finance investments – in the 
latter case, year-end amounts may be small relative to infra-annual amounts 
outstanding; 

• 

cross-holdings of securities: 

•  mainly holdings by social security funds in the form of Treasury bills, notes 

and bonds; 

• 

• 

holdings of government securities by other government units; 

holdings by government agencies which intervene on the market to manage 
government debt and liquidity, where such agencies are not part of the unit 
that issues the debt. 

This item does not cover securities issued by government that are acquired by 
government under a repo operation, because repos are considered a collateralised 
loan of cash, not a transaction in securities. 

19    That is, where the financial asset and liability are held by the same institutional unit. 

Government finance statistics guide 

74 

 
 
                                                                    
The consolidating elements can be considered as either: 

• 

• 

the sum of all assets of each government sub-sector that are liabilities issued by 
government units (other than the unit which holds them); 

the sum of all liabilities of each government sub-sector that are held by 
government units (other than the unit which holds them). 

Items 3 to 6: Consolidating elements by instrument 

The instrument breakdown here follows the same definitions as for Table 3a. 

Item 7: Debt issued by central government (consolidated) 

All EDP debt instruments issued by central government held by non-government units 
and by government units outside central government are included. Debt instruments 
issued by central government units that are held within these units or by other central 
government units are not included in this item. 

Items 8 to 10: Held by state government, local government and 
social security funds 

All EDP debt instruments issued by central government that are held by government 
units outside central government are included, broken down by sub-sector (state 
government, local government and social security funds). An example is holdings of 
Treasury bills and other central government debt securities by social security funds. 

Item 11: Debt issued by state government (consolidated) 

All debt instruments issued by state government held by non-government units and by 
government units outside state government are included. Debt instruments issued by 
state government units that are held within these units or by other state government 
units are not included in this item. 

Items 12 to 14: Held by central government, local government and 
social security funds 

All EDP debt instruments issued by state government that are held by government 
units outside state government are included, broken down by sub-sector (central 
government, local government and social security funds). 

Government finance statistics guide 

75 

 
 
Item 15: Debt issued by local government (consolidated) 

All EDP debt instruments issued by local government held by non-government units 
and by government units outside local government are included. Debt instruments 
issued by local government units that are held within these units or by other local 
government units are not included in this item. 

Items 16 to 18: Held by central government, state government and 
social security funds 

All EDP debt instruments issued by local government that are held by government 
units outside local government are included, broken down by sub-sector (central 
government, state government and social security funds). An example is a loan 
provided by central government to local government. 

Item 19: Debt issued by social security funds (consolidated) 

All EDP debt instruments issued by social security funds held by non-government 
units and by government units that are not social security funds are included. Debt 
instruments issued by social security funds that are held by social security funds are 
not included in this item. 

Items 20 to 22: Held by central government, state government and 
local government 

All EDP debt instruments issued by social security funds that are held by government 
units that are not social security funds are included, broken down by sub-sector 
(central government, state government and local government). 

Items 23 to 26: Holdings of debt issued within government 
sub-sectors (memo items) 

These are the holdings of financial assets within the sub-sector, for example central 
government units holding the debt of other central government units. 

Items 23 to 26 are not included in the GFS Guideline, but are part of the GFS data 
request. 

Government finance statistics guide 

76 

 
 
8 

Compilation of aggregates for the euro 
area and the European Union 

This chapter discusses the compilation of GFS aggregates for the EU and the euro 
area. Three main issues are considered. The first is the aggregation method to be 
used for converting national series into a common currency. The second is the 
extension of the consolidation principle to “cross-border” transactions between 
national governments. The third issue is the treatment of EU budget transactions. 

8.1 

Aggregation method 

This chapter describes the two methods chosen for GFS: the fixed euro conversion 
rate method in the case of the euro area aggregates, and the current exchange rate 
method in the case of the EU aggregates. 

Under the fixed exchange rate method, the exchange rate in one chosen year is used 
for all years. In the case of the euro area aggregates, the irrevocable conversion rates 
into the euro of participating currencies are used. As the euro area countries already 
report their back data using the irrevocable conversion rates, the euro area 
aggregates are a simple sum of the country data in euro. 

Under the current exchange rate method, the actual market exchange rate in the year 
is used to aggregate national data. 

The difference between the aggregated stocks (across countries) in the common 
currency at the end of year t with the aggregated stocks at the end of year t-1 does not 
equal the sum of the aggregated flows in year t in the common currency, due to 
exchange rate fluctuations. 

8.2 

Consolidation of national data 

At present, cross-border transactions between national governments in the euro area, 
and between governments and the EU budget, are as a general rule not consolidated 
in GFS (nor are they consolidated in the ESA 2010 or in the EDP data provided by 
Member States). The same is true of cross-border holdings of government debt 
securities. Intergovernmental lending operations in the context of the financial crisis 
are an exception to this general rule: these are consolidated in the euro area and EU 
aggregates. One example of such intergovernmental lending operations is the loans 
provided by the European Financial Stabilisation Facility (EFSF), which was set up to 
lend money to euro area countries in financial difficulty. Its lending operations are 
rerouted through the government accounts of the guarantor euro area Member States 
(EAMSs). Thus, not only does the gross government debt of the country in need 
increase, but the gross government debt of the guarantor EAMSs also increases in 

Government finance statistics guide 

77 

 
 
proportion to their respective shares in the guarantees provided to the EFSF. The 
bilateral loans to Greece and the loans provided by the EFSF are consolidated in the 
euro area gross debt and financial transactions in loans items. 

8.3 

Treatment of the European Union budget and the EDF 

Transactions in the EU general budget and the EDF have a similar economic impact 
on national economies to transactions carried out by national governments. For 
example, EU budget transactions include the levying of taxes, the paying of transfers 
and the provision of services. They are therefore taken into account in the compilation 
of GFS EU and euro area aggregates: transactions between the EU budget or the 
EDF and the non-government units are added to either government expenditure or 
government revenue, and transfers between the EU budget and the government 
sector are consolidated. The EU budget and EDF transactions also affect the 
ESA 2010 national statistics, but there they are recorded as transactions between 
domestic institutional sectors and the rest of the world. 

The EU budget and EDF transactions with resident sectors in Member States are 
treated statistically as if they were the transactions of an extended general 
government sector. Transactions of the ECB, EIB, ESM and SRB/SRF are not part of 
the EU budget and so are not taken into account in GFS aggregates. 

It is useful to distinguish between two types of EU budget and the EDF transaction. 
Type I comprises transactions with individual Member States, and Type II transactions 
consist of transactions whose economic impact cannot be attributed to an individual 
Member State. 

Type I: 

•  On the revenue side, Type I transactions comprise EU own resources such as 

part of VAT, several kinds of customs duties20  and other indirect taxes21, and the 
Gross national income (GNI)-based fourth resource. The ESA 2010 defines the 
VAT-based and GNI-based third and fourth EU own resources (D.76) as current 
transfers paid by the general government of each Member State to the 
institutions of the European Union (S.212). In the ESA 2010 all VAT collected by 
government (whether further distributed to the EU institutions or not) is recorded 
as VAT (D.211) in the government accounts. The amount of VAT-based third own 
resource transferred to the EU budget is recorded as government expenditure 
under D.761. 

•  On the expenditure side, Type I transactions comprise expenditure within the 
framework of the EAGGF (e.g. on the CAP), the ERDF, the European Social 
Fund and the Cohesion Funds. National accounts record these mostly under 
subsidies (D.3) and capital transfers (D.9) as payments from the rest of the world 
to residents, or as current international cooperation (D.74) in the case of EU 

20    For example, those levied on the basis of the EU’s integrated tariff and on agricultural goods. 
21    Such as the levy on mining and steel-producing enterprises, sugar production levies, the tax on 

isoglucose and the co-responsibility levies on milk and cereals. 

Government finance statistics guide 

78 

 
 
                                                                    
current payments made directly to national governments. Type I transactions 
make up the bulk of the EU budget. 

Type II transactions consist of transactions whose economic impact cannot be 
attributed to an individual Member State. They include current international 
cooperation with third countries appearing under the EU budget headings external 
action or pre-accession aid (without counterparts in the national accounts of Member 
States), along with administrative expenditure, such as compensation of employees 
and intermediate consumption. They also include some receipts in the EU budget, 
such as direct taxes levied on employees of the EU institutions. The administrative 
expenditure, although not aimed at Member States, is included in their national 
accounts where the counterparts are resident units. The one exception is the payment 
made by the EU budget to each government for collecting EU own resources: this is 
treated as a Type I transaction. 

Conceptually, the treatment of the EU budget and EDF transactions in the compilation 
of EU aggregates is straightforward. They are handled as if they related to an extra 
Member State. Both Type I and Type II transactions are included. Type I transactions 
which have national governments as counterparts are consolidated in the EU 
aggregates according to the usual consolidation rules for government revenue and 
expenditure described in the other chapters of this Guide. This requires the elimination 
of any current transfers or capital transfers where the national government is a 
counterpart, such as the fourth resource. By contrast, own resources collection costs 
are not consolidated because they are treated as a sale of non-market output (P.131) 
by government to the rest of the world. 

It might be concluded that these overall net payments should be zero since, across all 
Member States, payments to the EU budget and the EDF should equal receipts from 
the EU budget and the EDF, given that the EU budget is in balance. This is not the 
case, however, because some types of expenditure from the EU budget cannot be 
assigned to an individual Member State and so are not included in the GFS tables of 
any Member State. This is either because there is no counterpart in a Member State 
(e.g. in the case of EU budget aid to developing countries) or because the expenditure 
is EU budget administrative expenditure. 

Government finance statistics guide 

79 

 
 
9 

References and background information 

9.1 

Legal background 

The ECB Guideline on government finance statistics (ECB/2018/13) amending 
Guideline ECB/2013/23 describes the data required by the ECB from NCBs in the 
context of GFS. 

9.2 

Other published guidance and manuals 

System of National Accounts 2008 (SNA 2008) 

International guidance on the compilation of national accounts, published jointly by the 
UN, the World Bank, the European Commission, the IMF and the OECD. It is available 
on the website of the UN Statistics Division at www.unstats.un.org. 

European System of Accounts 2010 (ESA 2010) 

This is the national accounts standard for Europe, derived from and largely consistent 
with the SNA 2008, but with some additional elements for the EU context. It is legally 
binding for all EU Member States. The version published in the EU Official Journal 
includes the transmission programme, which describes the tables that are required by 
the Commission. It is available on the Eurostat website at 
https://ec.europa.eu/eurostat/web/esa-2010/overview. 

Manual on government deficit and debt 

This provides further guidance on matters affecting the general government sector in 
national accounts. It is available on the Eurostat website at 
https://ec.europa.eu/eurostat. It is not legally binding. 

Manual on sources and methods for the compilation of COFOG statistics 

This manual provides a methodological background, practical guidance, national 
sources and methods for the compilation of COFOG data. It is available on the 
Eurostat website at https://ec.europa.eu/eurostat. 

IMF Government Finance Statistics Manual 2014 

This IMF publication defines the general government sector statistics used to support 
fiscal analysis. It is available on the IMF website at www.imf.org. The manual is 
described in more detail below. 

OECD Revenue Statistics 

Each year the OECD publishes its Revenue Statistics. An annex to the publication 
explains the OECD classification of taxes and provides an interpretive guide. It is 

Government finance statistics guide 

80 

 
 
useful for understanding differences between government revenue totals reported by 
OECD and GFS. It is available on the OECD website at www.oecd.org. 

9.3 

EDP notification tables 

The following pages present the EDP Notification Tables 1 and 3a.22  Each has been 
modified to show how it relates to the GFS reporting tables. EU Member States send 
the EDP notification tables to Eurostat at the end of March and the end of September 
each year. Typically, national statistical offices, with help from NCBs, prepare data for 
outturn years, and ministries of finance prepare data for the current (forecast) year. 
Notification Tables 1 and 3 have a reasonable correspondence with GFS. Notification 
Table 2a does not correspond closely to the GFS reporting tables, since it considers 
the transition between the national definitions of government balance and the deficit 
(-)/surplus (+) (B.9) of central government. This transition is different in each Member 
State, depending on the extent to which extra-budgetary funds and other 
decentralised units within the government sub-sectors are brought within the 
presentations of public accounts and budgets. Notification Tables 2b, 2c and 2d 
present a similar analysis for the other sub-sectors of general government. 

Table C 
Comparison of EDP Notification Table 1 and GFS tables 

Item in EDP table 

ESA 2010 codes 

Recording in the GFS tables 
(item numbers as in the GFS Guideline) 

Net lending (+)/net borrowing (-) 

General government 

– Central government 

– State government 

– Local government 

– Social security funds 

General government consolidated gross debt 

Currency and deposits 

Debt securities 

  Short-term 

  Long-term 

Loans 

  Short-term 

  Long-term 

General government expenditure on: 

Gross fixed capital formation 

Interest (consolidated) 

B.9 

S.13 

S.1311 

S.1312 

S.1313 

S.1314 

AF.2 

AF.3 

AF.31 

AF.32 

AF.4 

AF.41 

AF.42 

P.51 

D.41 

Table 1a, item 1 

Table 1a, item 2 

Table 1a, item 3 

Table 1a, item 4 

Table 1a, item 5 

Table 3a, item 1 

Table 3a, item 2 

Table 3a, item 3 

Table 3a, item 4 

Table 3a, item 5 

Table 3a, item 6 

Table 1a, item 32 

Table 1a, item 26 

Gross domestic product at current market prices 

B.1*g 

Table 1c, item 9 

22    In accordance with Council Regulation (EU) No 479/2009 as amended by Commission Regulation (EU) 

No 220/2014. 

Government finance statistics guide 

81 

 
 
 
 
 
 
 
 
 
                                                                    
Table D 
Comparison of EDP Notification Table 3a and GFS tables 

Item in EDP Notification Table 3a 

Recording in the GFS reporting tables   

Net borrowing (+)/lending (-) (B.9) of general government* 

Table 1a, item 1 

Net acquisition of financial assets (consolidated) 

Currency and deposits (F.2) 

Debt securities (F.3) 

Loans (F.4) 

Equity and investment fund shares/units (F.5) 

Financial derivatives (F.71) 

Other accounts receivable (F.8) 

Other financial assets (F.1, F.62 and F.72) 

Adjustments (consolidated) 

Net incurrence of liabilities in financial derivatives (F.71)   

Net incurrence of other accounts payable (F.8) 

Table 2a, item 5 

Table 2a, item 6 

Table 2a, items 7+8 

Table 2a, item 9 

Table 2a, item 14** 

Table 2a, item 15 

Table 2a, items 4+13** 

Table 2a, item 26** 

Table 2a, item 27 

Net incurrence of other liabilities (F.1, F.5, F.6 and F.72) 

Table 2a, items 18+24+25+26** 

Appreciation (+)/depreciation (-) of foreign currency debt 

Table 2a, item 35 

Issuance above (-)/below (+) nominal value 

Table 2a, item 36a (partly) 

Difference between interest accrued (D.41) (-) and interest paid (+) 

Table 2a, item 36b 

Redemptions of debt above (+)/below (-) par 

Table 2a, item 36a (partly) 

Changes in sector classification (K.61) (+/-) 

Table 2a, item 37a 

Other volume changes in financial liabilities (K.3, K4, K5) 

Table 2a, item 37b 

  Statistical discrepancies 

Difference between capital and financial accounts (+/-) 

Table 2a, item 1 

Other statistical discrepancies (+/-) 

Change in government consolidated gross debt   

Table 2a, item 37c 

Table 2a, item 38 

Notes: *The sign convention for net lending (+)/net borrowing (-) is different from that in EDP Tables 1 and 2. 
** Assuming that government employee stock options (F.72) are zero. 

9.4 

IMF government finance statistics 

The IMF collects annual and sub-annual GFS (IMF) data from most countries of the 
world. The methodology is described in the IMF Statistics Department’s recently 
expanded and updated Government Finance Statistics Manual 2014. The statistics 
are collected through its GFS Questionnaire.23 

Both GFS (IMF) and GFS (ECB) are based on the framework for national accounts 
(the SNA 2008 and the ESA 2010 respectively). There are nevertheless some 
differences. 

First, the IMF treats unfunded defined-benefit retirement benefits provided through 
social security schemes differently to the SNA 2008. Entitlements accruing under 
social security are not normally shown in the SNA. The SNA 2008 therefore allows 
some flexibility on the recording of pension entitlements of unfunded pension schemes 

23    Both the IMF Government Finance Statistics Manual (GFSM 2014) and the questionnaire are available 

on the IMF’s website at www.imf.org. 

Government finance statistics guide 

82 

 
 
 
 
 
                                                                    
in the main sequence of accounts. Contributions to the schemes reflect social security 
contributions receivable in the SNA 2008, but under GFS (IMF) they also reflect the 
increase in liabilities for promised future benefits in the GFS (IMF) balance sheets. 
The SNA 2008 requires that the estimates for these schemes be presented in a 
supplementary table. 

Second, GFS (IMF) encourage an extension of the coverage to include statistics for 
the public sector and its sub-sectors, i.e. including the general government sector and 
the public corporations sector, whereas the ESA 2010 and GFS (ECB) limit their data 
to the general government sector alone. 

Third, GFS (IMF) collect more information than GFS (ECB) and consequently, in some 
instances, offer a finer breakdown than GFS (ECB). In many cases, the extra detail is 
not defined by separate ESA 2010 categories. For example, the breakdown of taxes 
for GFS (IMF) is more detailed than for the ESA 2010 and is similar to the presentation 
in the OECD’s Revenue Statistics. Also, GFS (IMF) collect information on the 
sub-sectors of general government and allow the ESA 2010 social security fund sector 
to be combined with the central government sector, and each sub-sector of 
government to be divided into budgetary accounts and extra-budgetary accounts. This 
sub-classification of the general government sub-sectors is not defined in the 
ESA2010. 

In addition, GFS (IMF) generally show financial assets and liabilities at market value if 
tradable, or otherwise at nominal value, while GFS (ECB) show the stock of debt at 
face value. 

Finally, GFS (IMF), in principle, require consolidation of all flows and stock positions of 
the units in the general government sector. However, as explained in Chapter 2, GFS 
(ECB) do not consolidate certain categories of non-financial transactions, such as 
taxes and the sale of goods and services. 

Figure 2 shows the structure of accounts in GFS (IMF). GFS (IMF) show full 
reconciliation of transactions, other flows and balance sheets at market value. GFS 
(ECB) show this reconciliation only for the change in government debt and deficit 
(deficit-debt adjustment). 

Government finance statistics guide 

83 

 
 
Figure 2 
Structure of accounts in GFS (IMF) 

Stock positions

+

=

Stock positions

Transactions

Other economic flows

Flows

Statement of Operations

Revenue
Minus
Expense

Equals

Change in net 
worth due to 
transactions 
(net operating 
balance)

Equals

Transactions in 
nonfinancial 
assets

Plus

Change in net 
financial worth due 
to transactions (net 
lending (+)/ net 
borrowing (−))

Equals

Transactions in 
financial assets

Minus

Transactions in 
liabilities

Opening balance sheet

Net worth

Equals

Nonfinancial 
assets

Plus

Net financial 
worth

Equals

Financial assets

Minus

Liabilities

+

+

+

+

+

Source: IMF. 

Statement of Other 
Economic Flows

Closing balance sheet

Change in net 
worth due to 
other economic 
flows

Equals

Other economic 
flows in nonfinancial 
assets

Plus

Change in net 
financial worth 
due to other 
economic flows

Equals

Other economic 
flows in financial assets

Minus

Other economic 
flows in liabilities

=

=

=

=

=

+

+

+

+

+

Net worth

Equals

Nonfinancial 
assets

Plus

Net financial 
worth

Equals

Financial assets

Minus

Liabilities

Government finance statistics guide 

84 

 
 
 
© European Central Bank, 2019 

Postal address 
Telephone 
Website 

60640 Frankfurt am Main, Germany 
+49 69 1344 0 
www.ecb.europa.eu 

All rights reserved. Reproduction for educational and non-commercial purposes is permitted provided that the source is acknowledged. 

For specific terminology please refer to the ECB glossary (available in English only). 

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ISBN 978-92-899-3677-4, ISSN 1725-4531, doi 10.2866/706961, QB-XC-19-001-EN-N