HL Deb 07 March 1995 vol 562 cc116-8

2.54 p.m.

Lord Bruce of Donington asked Her Majesty's Government:

What is their response to the proposal of the European Commission on the establishment of a European system of national and regional accounts (COM(94)593 Final of January 19th 1995); and what is their estimate of (a) the annual cost to the Exchequer and (b) the annual compliance cost, on the assumption that the proposal is adopted.

The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish)

My Lords, the proposed regulation will lead to the availability of harmonised national accounts statistics for all member states. The implications for UK contributions to the Community budget will depend on the final form of the regulation. The costs of statistical developments will be met from within running cost limits for the departments involved. Any increase in compliance costs on business is expected to be small.

Lord Bruce of Donington

My Lords, I am grateful to the noble Lord for that reply. Is he aware that the regulation to which I referred is no fewer than 543 pages long? That is roughly 50 times the length of the average Council regulation, decision or directive. Is the Minister aware that there must be some cost to the Exchequer on rendering, in accordance with Community rules, the statistics set out in Appendix B to the regulation? Will he particularise in a little more detail as to the cost beyond the vague generalities to which he has so far treated the House?

Lord Mackay of Ardbrecknish

My Lords, on compliance costs, I have nothing to add to the point I made that the cost to business is expected to be small. Many of the statistics are already collected by the British Government. The point at issue is that statistics collected around the Community should be gathered on the same basis so that harmonisation will lead to an ability to compare GNP statistics and other statistics between member states on a fair and equitable basis.

Lord Peston

My Lords, is the noble Lord aware how deeply embarrassed I am in saying how much I agree with everything he has just said? Does he accept that it is obvious that this is exactly the kind of area where the Community has a valuable role to play, in terms not merely of national accounts but also of the excellent harmonised employment statistics that it gathers as well as, in due course, inflation and other statistics? Does the Minister agree that that is precisely what the Community ought to do at Community level? In many ways it ought to divert itself from its sillier activities to this most excellent activity.

Lord Mackay of Ardbrecknish

My Lords, I am happy to agree with the noble Lord in both those sentiments. He rightly points to the advantage of harmonised statistics—an advantage accepted by the Court of Auditors' report in 1993. The report said that:

In spite of the measures already taken by the Commission, the degree of comparability, exhaustiveness and reliability of the data in respect of the Member States' national accounts should be improved and considerable progress may still be made so as to obtain a genuinely harmonized system".

Lord Bruce of Donington

My Lords, is the Minister aware that standards of accounting practice throughout the 12 member' states vary considerably? Although accounting standards in the United Kingdom, the Netherlands and Germany may measure up to those that we normally expect in the United Kingdom, the professional standards in preparing accounts throughout the rest of the Community are—I put the word in quotation marks—"dodgy". Is the noble Lord aware that the task of assembling the total results of the accounts, which are dealt with in the first part of the regulation, and of translating them into national figures for central assimilation must involve hours, weeks or even years of work? In view of that, will the Minister reconsider his vague estimate as to the cost? I ask that irrespective of the view of my noble friend on the Front Bench that the whole exercise may be well worth while.

Lord Mackay of Ardbrecknish

My Lords, it is true that the Commission puts the cost over the period 1995–97 at about 9 million ecus. One million of that will be for the central collection work; the other 8 million will be for those countries identified rightly by the noble Lord as having poorly developed collection systems. I am sure that the noble Lord will be glad to hear that the process has already led to countries with less developed statistical systems significantly increasing the value of the GNP base on which their fourth resources contributions are calculated. So we are already seeing some progress from those countries with systems which are not so well developed improving to the level of the best.

Lord Bruce of Donington

My Lords, is the noble Lord aware that most of us, while supporting the generality of the desirability of some standardised figures and some standardised way of going about it, may look at the cost and hope for a wing and a prayer?

Lord Mackay of Ardbrecknish

My Lords, I must say that the noble Lord seldom flies on a wing and a prayer on the subject of Europe. I simply re-emphasise one of the points that he continually makes, that some countries are not very good at looking after their money or that of other people. I should have thought that better statistical information would help that.