Joe McHugh (Donegal, Fine Gael) | Oireachtas source

There is a growing demand for data on societal progress and well-being, and I thank Deputy Howlin for raising this important matter. While economic indicators such as gross domestic product are a useful measure of the overall progress of an economy, they reveal little about the well-being of citizens or the distribution of economic growth among different sectors of society. To measure societal well-being, supplementary indicators, including some of those referred to in the Bill, are therefore needed.

Having said that, while the Government shares the Deputy's views regarding the importance and value of a broader measurement of societal well-being and progress, the Government opposes this Bill for the following reasons. First, the Bill would potentially impact on the independence of the Central Statistics Office, CSO. The Bill would require the National Economic and Social Council to approve the methodology for the compilation of the genuine progress indicators and national distribution accounts. This would undermine the statutory independence of the CSO, whereby the director general has sole responsibility for and is independent in deciding the production of statistics, the statistical methodology, the content of releases and the timing and method of dissemination of statistics. This independence is enshrined in statute, under the Statistics Act 1993, and is explicitly referenced in the European statistics code of practice. The independence of national statistical institutes, such as the CSO, is also an established principle in Council Regulation 223/2009 on European statistics and in the UN fundamental principles of official statistics. It reflects best practice for the organisation of official statistics and ensures statistics are independent, impartial and reliable. The Government, in its commitment on confidence in statistics, on 30 May 2017 reconfirmed its commitment to continue to guarantee the independence of the CSO and the National Statistics Board.

Second, the work programme of the CSO is largely defined by requirements arising from EU regulations and it is already challenging to balance those obligations with meeting the needs of national users.

If the Bill is passed, the CSO would be obliged to add activities to its statistical programme without regard to the cost or competing demand for statistics, including its obligations under EU regulations. The passing of the Bill in its current form would impose revisions to established CSO work plans and business structures, resulting in delays to outputs that are already in progress and should address the principal data needs identified in the Bill. Those needs overlap with priorities already identified, including by the National Statistics Board. The NSB provides strategic direction to the CSO and establishes priorities for the compilation and development of official statistics. These data needs are, at least in part, addressed in current releases or will be satisfied by measures that are under development.

As part of its work, the NSB has identified gaps in the Irish statistical programme in the areas of health, energy and the environment as well as a growing demand for new indicators on well-being and social progress. Reflecting these priorities, the CSO has established two new divisions: environment and energy; and income, consumption and wealth.

Under section 3, the Bill proposes that the CSO collect, compile and publish genuine progress indicators relating to economic accounts, social and human health accounts and environmental accounts on a yearly basis. A number of these are already published by the CSO. Regarding economic accounts, Government debt, net worth and savings figures are published in the Government finance statistics release. Regarding social and human health accounts, the CSO published The Wellbeing of the Nation 2017 in January, its first such report. That report is a composite report of more than 30 indictors across eight themes: economy; work; education; housing and natural environment; governance and equality, health; public safety; and time use. The release of well-being data is a new initiative for the CSO and will be further developed in the future. The CSO consulted the National Economic and Social Council, NESC, on the development of these indicators.

The CSO publishes on a biennial basis a sustainable development indicators report and is a participant in a pilot programme for capturing data on the UN sustainable development goals, SDGs. To date, 60 indicators for 14 of the 17 SDGs have been published.

Last month, the CSO published higher education outcomes – graduates of 2010 to 2014 - and, in June 2017, it published for the first time a system of health accounts release.

Since the establishment of the environmental and energy division, the CSO has almost doubled its number of environmental publications. Four new environmental publications are scheduled to be published this year covering some of the indicators listed in the Bill.

As the Deputy pointed out, section 3 of the Bill also proposes that the CSO would compile and publish national distributional accounts on a yearly basis to measure the distribution of economic growth. The importance of the distribution of income, consumption and wealth in determining the economic well-being of people and material inequalities has been recognised at a European level. It has, therefore, been agreed that a conceptual framework of standards and methods for European income, consumption and wealth statistics will be developed.

The CSO conducts surveys of household income and income distribution through the survey on income and living conditions, SILC, of consumption through its household budget survey and, on an ad hocbasis, of wealth through the household finance and consumption survey. The SILC is the official source of data on household and individual income and provides a number of key national poverty indicators, such as the at-risk-of-poverty rate, the consistent poverty rate and rates of enforced deprivation. It further measures income equality across the entire income distribution. The CSO conducted a household finance and consumption survey in 2013 and will conduct a second such survey in 2018 for publication in late 2019. The CSO is proposing to embed this wealth survey into its programme of household surveys. The expansion of this work on wealth-related statistics would provide the full picture of the distribution of income, consumption and wealth.

As this model evolves, the intention of the CSO is to publish statistics on the joint distribution of income, consumption and wealth. The CSO is also beginning to develop options regarding national distribution accounts, which will involve producing estimates of the distribution of income and wealth that are consistent with national accounts macro aggregates.

Considering all the work currently under way, it does not seem necessary to legislate to create a parallel statutory process involving the NESC to identify further statistical requirements in these areas.

The Bill proposes assigning new functions to the NESC, which would be required to approve the methodology for the compilation of genuine progress indicators and national distributional accounts. Under section 4, the Bill also proposes that the NESC would be required to produce an assessment each year of the impact of the budget on economic and social inequality, poverty reduction, and income and wealth distribution. The NESC would be required every five years to assess these impacts in terms of the cumulative effect of the previous five budgets.

In addition to impinging on the statistical independence of the CSO, the assignment through legislation of additional functions to the NESC would impact on its ability to achieve its current work programme. As the House will be aware, the role of the NESC is to analyse and provide advice on strategic policy matters relevant to Ireland's economic, social, environmental and sustainable development. The council's current work programme up to 2019 comprises three themes. First is a key social challenge: low-work intensity households, quality tailored services and participation. Second is climate change: governance of the low-carbon transition. Third is land value, land use and urban development.

Over the coming years, Ireland faces into a period of significant change at home and abroad that will present new and exceptional challenges. A Programme for a Partnership Government specifically notes that there are policy challenges where long-term thinking is required. It is important that the NESC, as a research and advisory body, has the scope and flexibility around its work programme to be able to take on board Government priorities and address issues that have emerged from its own work or consultations.

Following the end of the term of the previous council in 2016, some time was taken to reflect on its role and working methods. A number of changes were made aimed at making the council more effective, including fewer plenary meetings, more in-depth discussions on issues through working groups and committees, and a reduced membership while also capturing a broad range of views. The new council was appointed in 2017 and the priority now is to bed down these changes and allow the NESC to fulfil its strategic advisory role. It is appropriate to allow these changes to become firmly established in advance of legislating to give significant new functions to the NESC.

It is not clear that the NESC is best placed to produce impact assessments of budget measures. A wide range of bodies already engage in budget scrutiny, including the Oireachtas Committee on Budgetary Oversight, the Irish Fiscal Advisory Council, the Economic and Social Research Institute, ESRI, the Parliamentary Budget Office and civil society stakeholders such as Social Justice Ireland. The Departments of Finance and Employment Affairs and Social Protection conduct an ex postimpact assessment of the main tax and social welfare measures introduced in the budget. The ESRI, using data from the CSO's SILC, publishes its assessment of the progressivity of the budgetary measures introduced. A new social impact assessment framework has been designed that broadens the scope of the analysis and focuses on schemes and spending programmes that have explicit socioeconomic objectives.

Additionally, the programme for Government contains a commitment to "develop the process of budget and policy proofing as a means of advancing equality, reducing poverty and strengthening economic and social rights." A policy paper, entitled Equality Budgeting: Proposed Next Steps in Ireland, was published alongside budget 2018. A pilot approach to gender budgeting has been adopted in the Revised Estimates for public services 2018, published in December 2017, with six Departments including indicators relating to equality objectives. The intention is that the publication of high-level objectives and associated indicators will enhance transparency around the level of progress towards achieving equality objectives. The pilot programme of equality budgeting will be reviewed following the 2018 budgetary cycle. Lessons from the pilot approach will be used to expand the initiative to other expenditure programmes and equality dimensions for the 2019 budgetary cycle.

For all the aforementioned reasons, the Government does not believe that it is necessary or appropriate to introduce primary legislation prescribing the types of statistical releases to be published by the CSO or assigning new functions to the NESC. However, we acknowledge the intention behind the Bill and I reiterate that the CSO is committed to developing indicators that go beyond GDP and is well advanced in meeting the user need for a measure of progress beyond GDP as identified by the NSB in its long-term strategy.

The CSO is always open to engaging with stakeholders, including the Oireachtas, on identifying statistical needs and data gaps. A mid-term review of the NSB's strategy will be launched in the near future, which will provide a further opportunity for stakeholders to engage on user needs.

Such engagement would be a more appropriate way of identifying needs than primary legislation such as this Bill and more valuable to the user.

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