title: Council Recommendation of 10 July 2012 on the National Reform Programme 2012 of Hungary and delivering a Council opinion on the Convergence Programme of Hungary, 2012-2015

text:
               24.7.2012

               EN

               Official Journal of the European Union

               C 219/40

         COUNCIL RECOMMENDATION
   of 10 July 2012
   on the National Reform Programme 2012 of Hungary and delivering a Council opinion on the Convergence Programme of Hungary, 2012-2015
   2012/C 219/12
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 121(2) and 148(4) thereof,
   Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (1), and in particular Article 9(2) thereof,
   Having regard to Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances (2), and in particular Article 6(1) thereof,
   Having regard to the recommendation of the European Commission,
   Having regard to the conclusions of the European Council,
   Having regard to the opinion of the Employment Committee,
   After consulting the Economic and Financial Committee,
   Whereas:

               (1)

               On 26 March 2010, the European Council agreed to the Commission’s proposal to launch a new strategy for jobs and growth, Europe 2020, based on enhanced coordination of economic policies, which focuses on the key areas where action is needed to boost Europe’s potential for sustainable growth and competitiveness.

               (2)

               On 13 July 2010, the Council adopted a recommendation on the broad guidelines for the economic policies of the Member States and the Union (2010 to 2014) and, on 21 October 2010, adopted a decision on guidelines for the employment policies of the Member States (3), which together form the ‘integrated guidelines’. Member States were invited to take the integrated guidelines into account in their national economic and employment policies.

               (3)

               On 12 July 2011, the Council adopted a recommendation (4) on Hungary’s National Reform Programme for 2011 and delivered its opinion on Hungary’s updated Convergence Programme for 2011-2014.

               (4)

               On 23 November 2011, the Commission adopted the second Annual Growth Survey, marking the start of the second European semester of ex ante and integrated policy coordination, which is anchored in the Europe 2020 strategy. On 14 February 2012, the Commission, on the basis of Regulation (EU) No 1176/2011, adopted the Alert Mechanism Report, in which it identified Hungary as one of the Member States for which an in-depth review would be carried out.

               (5)

               On 1 December 2011, the Council adopted conclusions calling on the Social Protection Committee, in cooperation with the Employment and other Committees, to present its views on actions recommended within the Europe 2020 policy cycle. These views form part of the opinion of the Employment Committee.

               (6)

               The European Parliament has been duly involved in the European Semester, in accordance with Regulation (EC) No 1466/97, and, on 15 February 2012, adopted a resolution on employment and social aspects in the Annual Growth Survey 2012 and a resolution on the contribution to the Annual Growth Survey 2012.

               (7)

               On 2 March 2012, the European Council endorsed the priorities for ensuring financial stability, fiscal consolidation and action to foster growth. It underscored the need to pursue differentiated, growth-friendly fiscal consolidation, to restore normal lending conditions to the economy, to promote growth and competitiveness, to tackle unemployment and the social consequences of the crisis, and to modernise public administration.

               (8)

               On 29 February 2012, the European Parliament and Hungary exchanged views under Article 2-ab(3) of Regulation (EC) No 1466/97.

               (9)

               On 2 March 2012, the European Council also invited Member States participating in the Euro Plus Pact to present their commitments in time to be included in their Stability or Convergence Programmes and their National Reform Programmes.

               (10)

               On 23 April 2012, Hungary submitted its Convergence Programme covering the period 2012-2015 and its 2012 National Reform Programme. In order to take account of their interlinkages, the two Programmes have been assessed at the same time. The Commission has also assessed, in an in-depth review under Article 5 of Regulation (EU) No 1176/2011, whether Hungary is affected by macroeconomic imbalances. The Commission concluded in its in-depth review that Hungary is experiencing external and internal imbalances, although not excessive ones.

               (11)

               Based on the assessment of the Convergence Programme pursuant to Regulation (EC) No 1466/97, the Council is of the opinion that the macroeconomic scenario underpinning the budgetary projections in the Programme is somewhat optimistic. The Hungarian authorities’ growth projections for 2012 and 2013 are higher by around half a percentage point compared to the Commission services 2012 spring forecast on account of the more optimistic official assumptions regarding domestic demand, particularly in 2013. The objective of the budgetary strategy outlined in the Convergence Programme is to ensure the sustainable correction of the excessive deficit by the 2012 deadline set by the Council in line with the Council Recommendation under the excessive deficit procedure of 13 March 2012. The official deficit targets and the planned fiscal efforts comply with that Recommendation. The Convergence Programme confirms the previous medium-term budgetary objective (MTO) of 1,5 % of GDP, which it plans to achieve by 2013. The MTO adequately reflects the requirements of the Stability and Growth Pact. Based on the (recalculated) structural budget balance (5), progress towards the MTO does not appear to be adequate in 2013 against the assessment of the Commission services 2012 spring forecast, which takes into account the implementation risks related to selected saving measures and a less optimistic macroeconomic scenario.
               The growth rate of government expenditure, taking into account discretionary revenue measures, is in line with the expenditure benchmark of the Stability and Growth Pact in 2013, but not in 2014 and in 2015. According to government plans, the public debt is continuously reduced throughout the programme period to below 73 % of GDP in 2015, but will remain above the 60 %-of-GDP reference value. Regarding the debt reduction benchmark, Hungary will be in a transitional period in 2013-2014 and the Convergence Programme would ensure sufficient progress towards compliance with the benchmark. According to the Convergence Programme, the debt reduction benchmark would be met at the end of the transitional period, in 2015, and thereby should help to reduce the accumulated external and internal indebtedness.

               (12)

               New regulations have been adopted for the implementation of the constitutional fiscal governance framework, but some of its features remain weak. The medium-term budgetary planning is only indicative, the resources of the Fiscal Council are not commensurate with its newly-granted strong veto power, and the availability of budgetary information remains insufficient. Strengthening the medium-term budgetary planning dimension and widening the analytical remit of the Fiscal Council would help to ensure that the new constitutional fiscal governance framework can play its role.

               (13)

               Policy responses to address the impact of tax reform on low wage earners (minimum wage increase, wage subsidy scheme) have not contributed to enhancing employment, whereas measures to encourage women’s participation in the labour market are a small step in the right direction. Making labour taxation more employment-friendly and further strengthening measures to encourage the participation of women in the labour market, particularly by expanding childcare and pre-school facilities, would help to improve the employment rate.

               (14)

               The public employment service has been reorganised resulting in an overall downsizing, pointing in the opposite direction of what was recommended in 2011. In the field of active labour market policies some measures aiming to provide tailor-made services for disadvantaged groups, for instance, under European Social Fund (ESF) programmes, appear credible and relevant. However, other measures aimed at disadvantaged groups (e.g. public works) are unlikely to be effective in improving the placement of participants in the open job market. Serious steps to strengthen the capacity of the public employment service should be taken without delay, while keeping the right balance of funding between public works and other active labour market policies, to help to improve the functioning of the labour market and raise the participation rate. Raising the growth potential through structural reform in the labour market would also be important for a sustained reduction of the vulnerabilities stemming from the large stock of external and internal debt. Furthermore, the National Social (Roma) Inclusion Strategy has not been mainstreamed in other policies.

               (15)

               Measures to improve the business environment largely go in the right direction, but there is significant room for further progress. Efforts to improve access to non-bank funding are also going in the right direction, but a comprehensive assessment of small and medium-sized enterprises (SMEs) policies is still missing. Hungary ranks very low on many indicators measuring the transparency and quality of public administration, where progress would also help in improving the stability of the institutional and policy environment. This, in turn, could improve conditions for foreign direct investment and would support the reduction of the significant imbalance in the net international investment position: in particular, the ratio of reinvested profits fell dramatically in 2009 and 2010 partly on account of the crisis but also as a result of a number of controversial and unpredictable changes in the policy and fiscal environment and in the legal and institutional system. The recent trend in public funding for research and innovation (since mid-2010) is not in line with the 2012 Annual Growth Survey priority of differentiated growth-friendly fiscal consolidation.

               (16)

               The Government has carried out a higher education reform that introduced changes in the structure and funding of higher education. In addition, elements of the new legislation on school education risk increasing the number of early school leavers and segregation in the Hungarian school system. The equally important issue of lifelong learning is not sufficiently addressed. Improving education at all levels will be important to raise the competitiveness of the Hungarian labour force.

               (17)

               The lack of progress in restructuring public transport has been an important reason for budget slippages in recent years. The vast majority of the rolling stock of public transport companies have reached the limits of their utility. Increasing the cross-border capacity of the electricity network could facilitate a potential increase in trade with neighbouring countries. The national energy regulator is not empowered to organise its structures autonomously and lacks exclusive competence to set network tariffs including the rate of return that network operators are allowed to earn. Regulated prices should only apply to vulnerable customers.

               (18)

               In the context of the European Semester, the Commission has carried out a comprehensive analysis of Hungary’s economic policy. It has assessed the convergence programme and national reform programme, and has presented an in-depth review. It has taken into account not only their relevance for sustainable fiscal and socioeconomic policy in Hungary, but also their compliance with EU rules and guidance, given the need to reinforce the overall economic governance of the Union by providing EU-level input into future national decisions. Its recommendations under the European Semester are reflected in recommendations (1) to (7) below.

               (19)

               In the light of this assessment, the Council has examined the Convergence Programme, and its opinion (6) is reflected in particular in recommendation (1) below.

               (20)

               In the light of the results of the Commission’s in-depth review and this assessment, the Council has examined the National Reform Programme and the Convergence Programme. Its recommendations under Article 6 of Regulation (EU) No 1176/2011 are reflected in particular in recommendations (1), (3), (4) and (5) below,

         HEREBY RECOMMENDS that Hungary take action within the period 2012-2013 to:

               1.

               Correct the excessive deficit by 2012 in a durable manner, by implementing the 2012 budget and the subsequently approved consolidation measures, while reducing the reliance on one-off measures. Thereafter, specify all structural measures necessary to ensure a durable correction of the excessive deficit and to make sufficient progress towards the MTO, including meeting the expenditure benchmark, and ensure sufficient progress towards compliance with the debt reduction benchmark. Also to help mitigate the accumulated macroeconomic imbalances, put the public debt ratio on a firm downward path.

               2.

               Revise the cardinal law on economic stability by putting the new numerical rules into a binding medium-term budgetary framework. Continue to broaden the analytical remit of the Fiscal Council, with a view to increasing the transparency of public finances.

               3.

               Make the taxation of labour more employment-friendly by alleviating the impact of the 2011 and 2012 tax changes on low earners in a sustainable, budget-neutral manner, for example by shifting part of the tax burden to energy taxes and recurrent taxes on property. Strengthen measures to encourage women’s participation in the labour market, particularly by expanding childcare and pre-school facilities.

               4.

               Strengthen the capacity of the Public Employment Service to increase the quality and effectiveness of training, job search assistance and individualised services, with particular regard for disadvantaged groups. Strengthen the activation element in the public work scheme through effective training and job search assistance. Implement the National Social (Roma) Inclusion Strategy, and mainstream it with other policies.

               5.

               Implement measures envisaged to reduce the administrative burden. Ensure that public procurement and the legislative process support market competition and ensure a stable regulatory and business-friendly environment for financial and non-financial enterprises, including foreign direct investors. Reduce tax compliance costs and establish a stable, lawful and non-distortive framework for corporate taxation. Remove unjustifiable restrictions on the establishment of large-scale retail premises. Provide specific well-targeted incentive schemes to support innovative SMEs in the new innovation strategy.

               6.

               Prepare and implement a national strategy on early school-leaving by ensuring adequate financing. Ensure that the implementation of the higher education reform improves access to education for disadvantaged groups.

               7.

               Reform the public transport system to make it more cost efficient. Increase the cross-border capacities of the electricity network, ensure the independence of the energy regulator and gradually abolish regulated energy prices.

      Done at Brussels, 10 July 2012.

            For the Council

            The President

         V. SHIARLY

      (1)  OJ L 209, 2.8.1997, p. 1.

      (2)  OJ L 306, 23.11.2011, p. 25.

      (3)  Maintained for 2012 by Council Decision 2012/238/EU of 26 April 2012 on guidelines for the employment policies of the Member States (OJ L 119, 4.5.2012, p. 47).

      (4)  OJ C 209, 15.7.2011, p. 10.

      (5)  Cyclically-adjusted balance net of one-off and temporary measures, recalculated by the Commission services on the basis of the information provided in the Programme, using the commonly agreed methodology.

      (6)  Under Article 9(2) of Regulation (EC) No 1466/97.


Important legal notice

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52005PC0217

Recommendation of the Commission on the independence, integrity and accountability of the national and Community statistical authorities  /* COM/2005/0217 final */

	[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |Brussels, 25.5.2005COM(2005) 217 finalCOMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND TO THE COUNCILon the independence, integrity and accountability of the national and Community statistical authoritiesRECOMMENDATION OF THE COMMISSIONon the independence, integrity and accountability of the national and Community statistical authoritiesCOMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND TO THE COUNCILon the independence, integrity and accountability of the national and Community statistical authorities1. INTRODUCTIONON 22 DECEMBER 2004, THE COMMISSION ADOPTED A COMMUNICATION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT ENTITLED 'TOWARDS A EUROPEAN GOVERNANCE STRATEGY FOR FISCAL STATISTICS'. IN THAT COMMUNICATION, A CONSISTENT STRATEGY WAS PROPOSED FOR STRENGTHENING THE EUROPEAN UNION’S GOVERNANCE OF FISCAL STATISTICS ALONG THE FOLLOWING THREE LINES OF ACTION: BUILDING UP THE LEGISLATIVE FRAMEWORK, IMPROVING THE OPERATIONAL CAPACITIES OF THE RELEVANT COMMISSION SERVICES, AND ESTABLISHING EUROPEAN STANDARDS ON THE INDEPENDENCE OF THE NATIONAL AND COMMUNITY STATISTICAL AUTHORITIES. ON 17 FEBRUARY 2005, THE COUNCIL (ECOFIN MEETING) WELCOMED THIS OVERALL STRATEGY AND, IN PARTICULAR, THE WORK THAT WAS ALREADY IN PROGRESS ON A CODE FOR EUROPEAN STANDARDS FOR THE STATISTICAL AUTHORITIES.In order to implement this strategy, the Commission presented a proposal for a Council Regulation amending Regulation (EC) No 3605/93 as regards the quality of statistical data in the context of the excessive deficit procedure[1]. This proposal was adopted by the Commission on 2 March 2005 and is currently under examination by the legislative authority. The proposal reinforces and clarifies the role of Eurostat as the statistical authority in the context of the statistics related to the excessive deficit procedure. The practical modalities for the implementation of the Regulation, and in particular for the conduct of the envisaged in-depth monitoring visits, will be specified once the Regulation is approved.Regarding the reinforcement of the operational capacity of the Commission services, and in addition to an increased mobilisation of the existing expertise as provided for in the proposal for a Regulation, the Commission has already taken a number of measures. For instance, a new unit specifically dealing with the validation of economic and fiscal accounts has been created in Eurostat. Furthermore, Eurostat has conducted an internal redeployment of staff in order to reinforce the activities linked to the validation of economic and fiscal accounts.This Communication on the independence, integrity and accountability of the national and Community statistical authorities, including the accompanying Recommendation of the Commission, corresponds to the third action line of the strategy announced by the Commission. It constitutes the response to the invitation sent on 2 June 2004 to the Commission by the Council to put forward a proposal, by June 2005, to develop minimum European standards, and also to the Council’s invitation of 17 February 2005 to enhance the independence of Eurostat in the performance of its tasks. Indeed, both aspects reflect the selfsame issue of the production of statistics for Community policy purposes.As a whole, the European Statistical System operates efficiently and in a satisfactory manner, and satisfies to a great extent the requirements of independence, integrity and accountability. The massive quantity and variety of statistics produced and disseminated by the national and the Community statistical authorities within that System, covering statistics well beyond the fiscal field, complies with strict requirements on quality and reliability.The Code of Practice on European Statistics, presented in this Communication, as a self-regulatory instrument containing standards for the independence of the national and Community statistical authorities provides a further guarantee for the good functioning of the European Statistical System and the production of high quality and reliable statistics. The Communication also presents proposals related to the monitoring of the implementation of the Code and considerations about the usefulness of an effective external advisory body for the European Statistical System. It also considers the need for setting statistical priorities, in particular with the objective of reducing the regulatory burden on statistical respondents and outlines a number of guiding principles for a rebalancing of these priorities. Finally, it includes a Recommendation aimed at promoting the Code, both in the Member States and inside the Commission, through its political endorsement.2. INDEPENDENCE, INTEGRITY AND ACCOUNTABILITY OF THE NATIONAL AND COMMUNITY STATISTICAL AUTHORITIES2.1. Background and purpose of the Code of PracticeThe Code is a self-regulatory instrument, as it was prepared and endorsed by the principal producers of European statistics, namely the national statistical institutes. In fact, an initial outline of principles was discussed on 17 November 2004 with the Member States in the Statistical Programme Committee (SPC). Subsequently, a working group was entrusted by the SPC with the task of finalising a proposal for a Code, which was unanimously endorsed by the SPC on 24 February 2005, thus expressing its attachment to the Code as a self-regulatory instrument.The Code of Practice consists of 15 principles to be applied in connection with the production of Community statistics. It has a dual purpose: on the one hand, to improve trust and confidence in the statistical authorities by proposing certain institutional and organisational arrangements and, on the other hand, to reinforce the quality of the statistics they produce and disseminate, by promoting the coherent application of best international statistical principles, methods and practices by all producers of official statistics in Europe.The Code represents, in its substance, the response to the invitation of 2 June 2004 from the Council and, in certain respects, exceeds the required minimum standards. Member States should therefore be invited to acknowledge the importance of the Code of Practice and to take the measures required to ensure its correct implementation by the relevant authorities concerned, as well as to promote it among users and data providers. The Commission likewise intends to make sure that these principles are respected as far as Eurostat is concerned. Lastly, this paper proposes measures aimed at monitoring and reviewing the implementation of the standards of the Code.2.2. The scope of the CodeThe Code deals primarily with the production of official statistics within the European Statistical System (ESS). The ESS refers to the existing partnership comprising Eurostat, the national statistical institutes and other national statistical bodies responsible in each Member State for producing and disseminating statistics necessary for the performance of the activities of the European Union. The statistics covered by the Code are those referred to in the Council Regulation on Community Statistics[2], i.e. statistics produced and disseminated by national statistical authorities and the Community statistical authority (Eurostat) in conformity with Article 285(2) of the EC Treaty. It is important to underline that the Code covers the whole spectrum of statistics produced at Community level, going far beyond the sphere of economic and fiscal statistics.However, it should also be borne in mind that a number of other institutions and bodies outside the ESS provide official statistics at European level. For instance, the European System of Central Banks (ESCB) produces a wide range of European statistics in the economic and monetary field. The European Central Bank (ECB), assisted by the national central banks, collects either from the competent national authorities or directly from economic agents the statistical information which is necessary for the tasks of the ESCB. The collection of statistical information by the ECB is governed by a specific Council Regulation[3].Although the standards contained in the Code are meant to be a source of inspiration for all institutions and bodies producing official statistics, whether or not they belong to the ESS, they do not affect the existing rules that relate to these institutions or bodies. Although the Code’s title covers the wide range of “European statistics” as being those defined as Community statistics in the current legal framework, at the same time it signals the ambition to move towards Europe-wide standards.2.3. The principles laid down by the CodeThe document is structured around 15 principles. These principles mirror to a large extent the existing international standards, such as the Fundamental Principles of Official Statistics adopted by the United Nations Statistical Commission, in its Special Session of 11-15 April 1994.The principles are grouped in three sections addressing respectively the institutional environment, the statistical processes and outputs. A mechanism of peer reviews based on indicators has also been included.2.3.1. The principle of independenceIn the statistical sector, independence has first and foremost an operational dimension. That means it essentially governs the way statistical authorities function or operate for the production and dissemination of statistics.The principle of scientific independence is enshrined in the Treaty (Article 285(2)) and refers to objectivity in the statistical production process. Article 10 of Council Regulation (EC) No 322/97 specifies that " impartiality is an objective and independent manner of producing Community statistics, free from any pressure from political or other interest groups, particularly as regards the selection of techniques, definitions and methodologies best suited to the attainment of the objectives as set out (…)".The Code takes the principle of independence further by introducing the concept of professional independence, which refers specifically also to dissemination and availability of statistics. The Code establishes the principle of professional independence in the following terms: " the professional independence of statistical authorities from other policy, regulatory or administrative departments and bodies, as well as from private sector operators, ensures the credibility of European Statistics ". Indicators to monitor the application of this principle, which is also applicable to Eurostat, include (i) the specification in law of the elements of independence, (ii) the status and the functional responsibilities of the heads of statistical authorities, including the decisions on statistical methods, standards and procedures (iii) the decisions on the content and timing of statistical releases and (iv) the publication of statistical work programmes.The existing legislation satisfies the scientific independence requirement, i.e. the functional requirements for the production of high-quality statistics. The introduction of additional considerations on professional independence by the Code further reinforces the overall independence whilst respecting the different and sometimes diverging legal and administrative arrangements in the Member States, as an expression of their respective political and cultural traditions. Through the enhancement of this independence, it is expected that trust and public confidence in official statistics will increase.2.3.2. The issues of integrity and accountabilityThe issues of integrity and accountability are fundamentally of a horizontal nature. They do not constitute specific statistical principles, explicitly recognised in the Code; however, integrity is supported by such underlying concepts as legality, legitimacy, justification and equity. Integrity and accountability of both national and Community statistical authorities are reinforced by the surveillance mechanisms provided for in the Code, which result in increased transparency.The Code includes monitoring indicators for every single principle. These indicators cover, for example, the exclusive responsibility of the heads of statistical bodies for the production and methodology of statistics (under professional independence - see Principle 1). The use of external experts to review the key statistical outputs (under Principle 4), the user satisfaction surveys (under Principle 11) and the requirement to take due account of the users' needs (under Principle 13) are additional elements of integrity and accountability. Moreover, integrity and accountability are also strengthened through peer reviews, which are envisaged as part of the monitoring arrangements.2.4. Implementing the Code and monitoring its implementationThe Commission has adopted a Recommendation in order to increase the impact of the self-regulatory character of the Code. To balance such an endorsement with the requirement of accountability, the Commission will monitor adherence to the Code within the ESS. The Commission will set up a reporting system based on information to be provided by the Member States. To this end the Commission will co-ordinate the development of appropriate instruments, benchmarking and peer reviews based on indicators, while ensuring that the proportionality principle is respected.The monitoring of the Code’s implementation shall follow a gradual approach over three years. During the first year of implementation, initial self-assessment reports will be produced by both the Member States and Eurostat. These reports will be transmitted to the SPC. Furthermore, Member States will be encouraged to develop some methods and best practices, which will be taken into account during the ensuing stages. During the second year of implementation, interim self-assessment reports will be prepared in a more structured format, following more specific guidelines established by Eurostat and the SPC on the basis of the experience gained during the first year. Lastly, final self-assessment reports will have to be presented by the Member States and Eurostat during the third year of implementation of the Code. These reports will follow a common format and will be complemented by peer review assessments carried out with the assistance of a Task Force composed of representatives of NSIs and possibly by an external advisory body (see point 2.5 below). Finally, they will be transmitted to the SPC and possibly this external advisory body and made public. The reports transmitted by the statistical authorities should be produced under the responsibility of the Head of the statistical authority.Taking into account the outcome of the combined self-assessment and peer review process, the Commission will report on the implementation of the Code by the Member States and by Eurostat respectively. Three years after the adoption of this Recommendation and after consulting the SPC and possibly the external advisory body (see point 2.5 below), it will present a report to the European Parliament and the Council on the progress of the implementation and, where necessary, include appropriate proposals.2.5. The need for an active role by an external advisory body to enhance independence, integrity and accountability of the European Statistical SystemIn view of reinforcing the governance of the European Statistical System, in line with the principles set in the Code of Practice and the elements contained in this Communication, an external advisory body would be useful. Such body could enhance the credibility of the efforts undertaken to strengthen the independence, integrity and accountability of the national institutes, Eurostat and the ESS, for the accomplishment of their mission and as far as Community statistics are concerned, as called for by the ECOFIN Council.In particular, such body could provide the Commission with useful input in carrying out the mandate assigned to it by the Treaty, namely the monitoring of the observance of the fundamental statistical principles as laid down in Article 285(2) of the EC Treaty, and restated by the Code of Practice. Accordingly, this body could be entrusted with an active role to oversee how the Code is implemented by the ESS as a whole, as well to provide advise on statistical priorities consistent with the principles presented in point 2.6 below.This external advisory body should be composed of high-level personalities. The total number of members should be limited to a level that ensures an operational and effective body. One group of members would be appointed by the Council, from among persons having a well-established qualification or interest in the field of statistics and representing civil society ( e.g. scientific community, business associations, unions, etc.), with account being taken of the need to ensure adequate coverage of the various statistical domains. Other members would be drawn from EU institutions and bodies (European Parliament, Council, Commission, European Central Bank, Statistical Programme Committee) and be directly appointed by them. The chairman will have to be an eminent, highly regarded person.At present there is a Committee, the European Advisory Committee on statistical information in the economic and social spheres (CEIES)[4], which at least partly fulfils this role[5]. Such Committee, which assists both the Council and the Commission, was set up in 1991 to voice the interests of the users, thus ensuring that user requirements and the costs borne by the information producers are taken into account. While this body has proven useful, its role, mandate, compositions and procedures could be revisited[6], in order to contribute optimally to the objectives of the European Statistical System.A reformed CEIES could play the role envisaged for external advisory body. In that case, its current assignments and responsibilities including giving its opinion on the statistical work programmes, would be extended. The Commission is ready to consider proposing a reform of the CEIES along these lines.2.6. Principles for a rebalancing of statistical prioritiesProducing statistics of high quality and reliability requires to balance data requirements with the resources made available to the statistical authorities and the burden on the respondents. Principle 9 of the Code provides that statistical authorities should set targets for the reduction of the burden on respondents over time. A number of indicators are specified in order to ensure that the reporting burden is not excessive for respondents. This includes in particular the use of best estimates and approximations, access to administrative sources or data sharing within statistical authorities.Freeing up capacities would then allow statistical authorities to concentrate all their efforts on statistical activities clearly identified as a priority. Indeed, the ECOFIN Council concluded in February 2005 that “national statistical offices’ capacity to meet high statistical standards depends crucially on the ability to prioritise the burden from EU statistical requirements on authorities. Priority setting in this respect would also need to be conducive to a reduced regulatory burden on respondents. Therefore, and in line with the ECOFIN Council conclusions of 2 June 2004, ministers are looking forward to discussing in June 2005 proposals by the Economic and Financial Committee on the rebalancing of statistical priorities”.Priority setting may also lead to simplified legislation. In that respect, it has to be recalled that, on the basis of suggestions from the Member States to identify EU legislation that might benefit from simplification, the Council (Competitiveness meeting) identified in November 2004, 15 priorities for simplification.At the same time, the setting of statistical priorities should not prevent the European Commission to propose statistical measures necessary for the performance of any of the activities of the Community, as foreseen by the Treaty. In this context, the Commission considers that some general principles can be followed for the precise identification of ‘positive’ and ‘negative’ priorities in defining the statistical programmes.The first category of principles would relate to users’ needs. The benefits of European statistics are to be mainly derived from their relevance for policy-making at the European level. Purely national needs cannot be a reason to continue with statistics at Community level.The second category of principles would relate to cost assessment. The question of the cost of statistical activities is a very complex one, and proposals need to be examined with the greatest care. In most cases the burden of implementation will fall on the Member States.The third category would cover specific issues. The re-balancing process should take into account the trade-off between timeliness and quality: high-frequency data should cover the main breakdowns, while more details would be provided at a lower frequency. The prioritisation process could also investigate whether efficiency gains are possible by focusing more strongly on the European aggregates or, for data considered of lower priority and not pertaining to fiscal surveillance, by differentiating, as far as reporting obligations are concerned, between Member States with high and low weights in the aggregate.3. THE RECOMMENDATION3.1. Why a Recommendation?In the December 2004 Communication on a European Governance Strategy for Fiscal Statistics, it was announced that various possible legal instruments would be examined when addressing the issue of minimum standards for the institutional set-up of statistical authorities. From that examination, which also revealed a wide variety of institutional set-ups of the statistical authorities in the Member States, it appears that proposing a legally-binding instrument would not be appropriate for the moment. Therefore, and in the light of the achievements of the statistical authorities in adopting a Code as a self-regulatory instrument, the Commission considers that adopting a Recommendation is the appropriate and proportionate instrument at this point in time.However, this does not exclude the possibility of other instruments being envisaged in the future. On the basis of what is achieved and the experience that is acquired through the implementation of the Code, the Commission may consider a proposal for a legally binding instrument, for instance in the form of a directive, at a later stage.3.2. Purpose of the RecommendationThe Recommendation has a dual purpose. On the one hand, the aim is to recommend to Member States that they acknowledge the importance of the Code and take the measures required to ensure that it is correctly implemented by the relevant authorities, as well as to promote it among users and data providers. On the other hand, the Commission will take appropriate actions, in particular to monitor observance of the Code within the European Statistical System.Additionally, the Commission intends to take similar measures within its own sphere of competence and to enhance the independence of Eurostat in the performance of its tasks by ensuring that, as the Community’s statistical authority, it likewise adheres to the standards contained in the Code. The independence of Eurostat in the fulfilment of its mission is already formally established. A Commission Decision of 21 April 1997 on the role of Eurostat as regards the production of Community statistics[7] was aimed at implementing the above-mentioned Council Regulation (EC) No 322/97 (the so-called ‘Statistical Law’) within the internal organization of the Commission. That Decision defines the role and the responsibilities of Eurostat, as the Community statistical authority, and in particular the technical autonomy enjoyed by Eurostat in the performance of its tasks. According to the same text, Eurostat fulfils a coordinating role within the Commission for the production of statistics. A further positive indication of Eurostat’s functional independence, which is enshrined in legislation, is the fact that Eurostat officials enjoy a privileged status compared to other Commission officials in that they alone can access confidential statistical data[8]. The implementation of the Code by Eurostat and the measures the Commission may take to facilitate and monitor this implementation will certainly contribute to reassert and further enhance the independence of the Community statistical authority.The objective of this Recommendation is therefore to promote the standards contained in that Code and to recommend to take appropriate actions with a view to ensuring effective implementation of these standards by both the national and the Community statistical authorities.Furthermore, the Commission intends this Recommendation to be followed by supporting measures to facilitate the implementation of the Code. These measures will include, where necessary, detailed protocols or guidelines and a broader consultation of stakeholders. These activities will also further improve the quality of statistics at European level, while taking into account cost-effectiveness considerations as well as the burden on respondents. To this end initial findings will be gathered in the framework of the Principal European Economic Indicators (PEEI). Lastly, the Commission takes note that the users to whom the Code is addressed need to be able to recognise statistical information that is produced in accordance to the principles of this Code. The Commission will therefore launch appropriate measures which will allow the identification of official European statistics, thus improving transparency and quality of data dissemination.ConclusionThe Recommendation and the attached Code focus on Europe-wide standards with the objective of reinforcing the independence, integrity and accountability of the statistical authorities. They represent the response to the invitation addressed by the Council to the Commission to make proposals in this area. The Recommendation constitutes a further step in the continuing process of enhancing statistical governance in Europe.RECOMMENDATION OF THE COMMISSIONon the independence, integrity and accountability of the national and Community statistical authorities (Text with EEA relevance)THE COMMISSION OF THE EUROPEAN COMMUNITIESHaving regard to the Treaty establishing the European Community, and in particular Article 211 thereof,Whereas:(1) Official statistics play a central role in democratic societies as they provide public authorities, policy makers, economic and social actors as well as all citizens, with objective and impartial information, on the basis of which informed decisions may be taken and issues openly debated.(2) In order to fulfil that role, official statistics must be produced and disseminated according to common standards guaranteeing compliance with the principles of impartiality, reliability, objectivity, scientific independence, cost-effectiveness and statistical confidentiality;(3) At the same time the role of European statistics is becoming increasingly important in the context of a relaunched Lisbon strategy[9] and the Integrated Guidelines for Growth and Jobs (2005-2008)[10]; high-quality statistics are also needed in order to monitor and review the implementation of other key policy initiatives at European level such as the sustainable development strategy, the common immigration and asylum policy, etc.(4) In that context, the specific role of fiscal data and government accounts is even more essential for economic and monetary surveillance and the proper implementation of the Stability and Growth Pact; in particular, statistical data used in the framework of the excessive deficit procedure are to be of the highest quality possible.(5) On 22 December 2004, the Commission adopted a Communication to the Council and the European Parliament entitled ‘Towards a European governance strategy for fiscal statistics’[11], proposing a consistent strategy for strengthening the European Union’s governance of fiscal statistics along three lines of action.(6) First, and following the invitation made by the Council, monitoring by the Commission of the quality of reported fiscal data has to be reinforced; to that effect, a proposal for a Council Regulation amending Regulation (EC) No 3605/93 as regards the quality of statistical data in the context of the excessive deficit procedure[12] was adopted by the Commission on 2 March 2005 and is currently under discussion.(7) Second, the operational capacities of the Commission in the statistical field have to be strengthened ; in the specific context of statistical monitoring under the excessive deficit procedure, regular dialogue visits and in-depth monitoring visits are required and all existing expertise has to be mobilised, including at national level.(8) Third, there is a need to establish Europe-wide standards as regards the independence, integrity and accountability of the national statistical institutes in response to the invitation addressed to the Commission by the Council on 2 June 2004 to present by June 2005 a proposal to develop minimum European standards for the institutional set-up of statistical authorities, which reinforce the independence, integrity and accountability of the Member States’ national statistical institutes.(9) In response to this invitation, on 17 November 2004 the Member States discussed in the Statistical Programme Committee the basic principles to be developed in a Code of Practice, and agreed to study the principles further and to establish indicators allowing the implementation of the Code to be monitored.(10) A working group was subsequently entrusted by the Statistical Programme Committee with the task of finalising a proposal for a code of practice on European statistics.(11) The resulting Code of Practice was unanimously endorsed by the Statistical Programme Committee on 24 February 2005, thus demonstrating that the principles it contains are shared by all the statistical institutes, which should then be invited to follow the Code as a guiding instrument.(12) The existing institutional set-up of the statistical authorities varies significantly across Member States, owing to the different and sometimes diverging legal and administrative arrangements in the Member States, which reflect their respective political and cultural traditions.(13) In the light of the achievements made by the statistical authorities through the adoption of the Code as a self-regulatory instrument and the expectation that they will implement it, it is considered that this Recommendation is appropriate and proportionate.(14) This Code of Practice has the dual purpose of, on the one hand, improving trust and confidence in statistical authorities by proposing certain institutional and organisational arrangements and, on the other hand, reinforcing the quality of the statistics they produce and disseminate, by promoting the coherent application of best international statistical principles, methods and practices by all producers of official statistics in Europe.(15) Member States should therefore be recommended to recognise the importance of the Code of Practice and take the measures required to ensure its correct implementation by the relevant authorities concerned, as well as to promote it among users and data providers.(16) It has to be noted that the Commission intends to take similar measures in parallel within its own sphere of competence and in particular to monitor observance of the Code of Practice, within the European Statistical System,I. HEREBY RECOMMENDS THAT MEMBER STATES:A. recognise in the attached Code a common set of standards at European level for the statistical authorities;B. ensure that the principles of the Code are respected by their statistical authorities with a view to producing and disseminating high- quality, harmonised Community statistics and to contributing in general to the proper functioning of the European statistical system as a whole;C. ensure that their statistical services are professionally organised and resourced to produce Community statistics in a manner that guarantees independence, integrity and accountability, on the basis of the guidelines provided by the Code;D. raise awareness of the existence of this Code and its contents among statistical respondents and data providers, as well as all users of statistics, using appropriate information and dissemination channels;E. promote an extensive exchange of information and expertise within the European statistical system, based on the experience gained through the implementation of the Code;F. support, and intensify where necessary, the wide-ranging co-operation between statistical authorities within the European Statistical System, as well as with statistical authorities of international bodies and organisations;G. provide the information necessary to enable the Commission to monitor adherence to the principles laid down in the Code.II. RECOGNISES IN THE ATTACHED CODE A COMMON SET OF STANDARDS AT EUROPEAN LEVEL FOR THE STATISTICAL AUTHORITIES AND IN THIS CONTEXT:A. will ensure that the principles of the Code are respected by Eurostat with a view to producing and disseminating high-quality, harmonised Community statistics and to contributing in general to the proper functioning of the European statistical system as a whole;B. will ensure that Eurostat, as the statistical authority of the European Union, is professionally organised and resourced to produce Community statistics in a manner that guarantees independence, integrity and accountability, and will take the appropriate measures accordingly, on the basis of its own internal organisation powers;C. will take appropriate measures to facilitate the implementation of the Code in the European Statistical System, in particular towards developing official Community statistics so that information produced in observance of this Code can be recognised by the users.III. FURTHERMORE INTENDS:A. to develop tools for improving at European level the quality of Community statistics, taking into account their cost-effectiveness;B. to set up a reporting system to monitor adherence to the Code within the European Statistical System in line with the proportionality principle;C. to consider proposing an external advisory body, possibly a reformed European Advisory Committee on Statistical Information in the Economic and Social Spheres, with a view to conferring on that body an active role in monitoring the implementation of the Code and, consequently, the enhancement of independence, integrity and accountability, and in expressing opinions on the balancing of the priorities of the statistical programmes;D. to present to the European Parliament and to the Council, within three years of the adoption of this Recommendation and after consultation of the Statistical Programme Committee and possibly of the external advisory body mentioned above, a report on progress in the implementation of this Code in the European Statistical System, based in particular on self-assessments and peer reviews and including, where necessary, proposals to enhance independence, integrity and accountability.Done at Brussels,For the CommissionThe President  EUROPEAN STATISTICS CODE OF PRACTICE adopted by the Statistical Programme Committee on 24 February 2005 PreambleDefinitions: | For the purpose of this document: European Statistics shall mean Community Statistics as defined in Council regulation (EC) No 322/97 of 17 February 1997 on Community Statistics, produced and disseminated by national statistical authorities and the Community’s statistical authority (Eurostat) in conformity with Article 285(2) of the Treaty. The Statistical Authority shall mean, at national level, the National Statistical Institute (NSI) and other statistical bodies in charge of producing and disseminating European Statistics and, at Community level, Eurostat. The European Statistical System, hereinafter referred to as the ESS, shall mean the partnership comprising Eurostat, National Statistical Institutes and other national statistical bodies responsible in each Member State for producing and disseminating European Statistics. |In coherence with the Treaty establishing the European Community, and in particular Article 285(2) thereof, with the Council regulation (EC) No 322/97 of 17 February 1997 on Community Statistics, and with the Fundamental Principles of Official Statistics adopted by the United Nations Statistical Commission on 14 April 1994, the present Code of Practice has the dual purpose of:-  Improving trust and confidence in the independence, integrity and accountability of both National Statistical Authorities and Eurostat, and in the credibility and quality of the statistics they produce and disseminate ( i.e. an external focus );-  Promoting the application of best international statistical principles, methods and practices by all producers of European Statistics to enhance their quality ( i.e. an internal focus ).The Code is addressed for implementation to:-  Governance authorities (i.e. Governments, Ministries, Commission, Council) - to provide guidelines for them to ensure that their statistical services are professionally organised and resourced to produce credible European Statistics in a manner that guarantees independence, integrity and accountability;-  Statistical authorities and their staff - to provide a benchmark of statistical principles, values and best practices that should help them in producing and disseminating high quality, harmonised European Statistics.It is addressed for information to:-  Users - to show that European and national statistical authorities are impartial and that the statistics they produce and disseminate are trustworthy, objective and reliable;-  Data providers - to show that the confidentiality of the information they provide is protected, and that excessive demands will not be placed on them.The Code of Practice is based on 15 Principles . Governance authorities and statistical authorities in the European Union commit themselves to adhering to the principles fixed in this code and to reviewing its implementation periodically by the use of Indicators of Good Practice for each of the 15 Principles, which are to be used as references.The Statistical Programme Committee established by Council Decision 89/382/EEC of 19 June 1989 will regularly carry out peer review monitoring of the implementation of the present Code.Institutional EnvironmentInstitutional and organisational factors have a significant influence on the effectiveness and credibility of a statistical authority producing and disseminating European Statistics. The relevant issues are professional independence, mandate for data collection, adequacy of resources, quality commitment, statistical confidentiality, impartiality and objectivity.Principle 1: Professional Independence - The professional independence of statistical authorities from other policy, regulatory or administrative departments and bodies, as well as from private sector operators, ensures the credibility of European Statistics.Indicators-  The independence of the statistical authority from political and other external interference in producing and disseminating official statistics is specified in law.-  The head of the statistical authority has sufficiently high hierarchical standing to ensure senior level access to policy authorities and administrative public bodies. He/She should be of the highest professional calibre.-  The head of the statistical authority and, where appropriate, the heads of its statistical bodies have responsibility for ensuring that European Statistics are produced and disseminated in an independent manner.-  The head of the statistical authority and, where appropriate, the heads of its statistical bodies have the sole responsibility for deciding on statistical methods, standards and procedures, and on the content and timing of statistical releases.-  The statistical work programmes are published and periodic reports describe progress made.-  Statistical releases are clearly distinguished and issued separately from political/policy statements.-  The statistical authority, when appropriate, comments publicly on statistical issues, including criticisms and misuses of official statistics.Principle 2: Mandate for Data Collection - Statistical authorities must have a clear legal mandate to collect information for European statistical purposes. Administrations, enterprises and households, and the public at large may be compelled by law to allow access to or deliver data for European statistical purposes at the request of statistical authorities.Indicators-  The mandate to collect information for the production and dissemination of official statistics is specified in law.-  The statistical authority is allowed by national legislation to use administrative records for statistical purposes.-  On the basis of a legal act, the statistical authority may compel response to statistical surveys.Principle 3: Adequacy of Resources - The resources available to statistical authorities must be sufficient to meet European Statistics requirements.Indicators-  Staff, financial, and computing resources, adequate both in magnitude and in quality, are available to meet current European Statistics needs.-  The scope, detail and cost of European Statistics are commensurate with needs.-  Procedures exist to assess and justify demands for new European Statistics against their cost.-  Procedures exist to assess the continuing need for all European Statistics, to see if any can be discontinued or curtailed to free up resources.Principle 4: Quality Commitment - All ESS members commit themselves to work and co-operate according to the principles fixed in the Quality Declaration of the European Statistical System.Indicators-  Product quality is regularly monitored according to the ESS quality components.-  Processes are in place to monitor the quality of the collection, processing and dissemination of statistics.-  Processes are in place to deal with quality considerations, including tradeoffs within quality, and to guide planning for existing and emerging surveys.-  Quality guidelines are documented and staff are well trained. These guidelines are spelled out in writing and made known to the public.-  There is a regular and thorough review of the key statistical outputs using external experts where appropriate.Principle 5: Statistical Confidentiality - The privacy of data providers (households, enterprises, administrations and other respondents), the confidentiality of the information they provide and its use only for statistical purposes must be absolutely guaranteed.Indicators-  Statistical confidentiality is guaranteed in law.-  Statistical authority staff sign legal confidentiality commitments on appointment.-  Substantial penalties are prescribed for any wilful breaches of statistical confidentiality.-  Instructions and guidelines are provided on the protection of statistical confidentiality in the production and dissemination processes. These guidelines are spelled out in writing and made known to the public.-  Physical and technological provisions are in place to protect the security and integrity of statistical databases.-  Strict protocols apply to external users accessing statistical microdata for research purposes.Principle 6: Impartiality and Objectivity - Statistical authorities must produce and disseminate European Statistics respecting scientific independence and in an objective, professional and transparent manner in which all users are treated equitably.Indicators-  Statistics are compiled on an objective basis determined by statistical considerations.-  Choices of sources and statistical techniques are informed by statistical considerations.-  Errors discovered in published statistics are corrected at the earliest possible date and publicised.-  Information on the methods and procedures used by the statistical authority are publicly available.-  Statistical release dates and times are pre-announced.-  All users have equal access to statistical releases at the same time and any privileged pre-release access to any outside user is limited, controlled and publicised. In the event that leaks occur, pre-release arrangements should be revised so as to ensure impartiality.-  Statistical releases and statements made in Press Conferences are objective and non-partisan.Statistical ProcessesEuropean and other international standards, guidelines and good practices must be fully observed in the processes used by the statistical authorities to organise, collect, process and disseminate official statistics. The credibility of the statistics is enhanced by a reputation for good management and efficiency. The relevant aspects are sound methodology, appropriate statistical procedures, non-excessive burden on respondents and cost effectiveness.Principle 7: Sound Methodology - Sound methodology must underpin quality statistics. This requires adequate tools, procedures and expertise.Indicators-  The overall methodological framework of the statistical authority follows European and other international standards, guidelines, and good practices.-  Procedures are in place to ensure that standard concepts, definitions and classifications are consistently applied throughout the statistical authority.-  The business register and the frame for population surveys are regularly evaluated and adjusted if necessary in order to ensure high quality.-  Detailed concordance exists between national classifications and sectorisation systems and the corresponding European systems.-  Graduates in the relevant academic disciplines are recruited.-  Staff attend international relevant training courses and conferences, and liaise with statistician colleagues at international level in order to learn from the best and to improve their expertise.-  Co-operation with the scientific community to improve methodology is organised and external reviews assess the quality and effectiveness of the methods implemented and promote better tools, when feasible.Principle 8: Appropriate Statistical Procedures – Appropriate statistical procedures, implemented from data collection to data validation, must underpin quality statistics.Indicators-  Where European Statistics are based on administrative data, the definitions and concepts used for the administrative purpose must be a good approximation to those required for statistical purposes.-  In case of statistical surveys, questionnaires are systematically tested prior to the data collection.-  Survey designs, sample selections, and sample weights are well based and regularly reviewed, revised or updated as required.-  Field operations, data entry, and coding are routinely monitored and revised as required.-  Appropriate editing and imputation computer systems are used and regularly reviewed, revised or updated as required.-  Revisions follow standard, well-established and transparent procedures.Principle 9: Non-Excessive Burden on Respondents - The reporting burden should be proportionate to the needs of the users and should not be excessive for respondents. The statistical authority monitors the response burden and sets targets for its reduction over time.Indicators-  The range and detail of European Statistics demands is limited to what is absolutely necessary.-  The reporting burden is spread as widely as possible over survey populations through appropriate sampling techniques.-  The information sought from businesses is, as far as possible, readily available from their accounts and electronic means are used where possible to facilitate its return.-  Best estimates and approximations are accepted when exact details are not readily available.-  Administrative sources are used whenever possible to avoid duplicating requests for information.-  Data sharing within statistical authorities is generalised in order to avoid multiplication of surveys.Principle 10: Cost Effectiveness - Resources must be effectively used.Indicators-  Internal and independent external measures monitor the statistical authority’s use of resources.-  Routine clerical operations (e.g. data capture, coding, validation) are automated to the extent possible.-  The productivity potential of information and communications technology is being optimised for data collection, processing and dissemination.-  Proactive efforts are being made to improve the statistical potential of administrative records and avoid costly direct surveys.Statistical OutputAvailable statistics must meet users’ needs. Statistics comply with the European quality standards and serve the needs of European institutions, governments, research institutions, business concerns and the public generally. The important issues concern the extent to which the statistics are relevant, accurate and reliable, timely, coherent, comparable across regions and countries, and readily accessible by users.Principle 11: Relevance - European Statistics must meet the needs of users.Indicators-  Processes are in place to consult users, monitor the relevance and practical utility of existing statistics in meeting their needs, and advise on their emerging needs and priorities.-  Priority needs are being met and reflected in the work programme.-  User satisfaction surveys are undertaken periodically.Principle 12: Accuracy and Reliability - European Statistics must accurately and reliably portray reality.Indicators-  Source data, intermediate results and statistical outputs are assessed and validated.-  Sampling errors and non-sampling errors are measured and systematically documented according to the framework of the ESS quality components.-  Studies and analyses of revisions are carried out routinely and used internally to inform statistical processes.Principle 13: Timeliness and Punctuality - European Statistics must be disseminated in a timely and punctual manner.Indicators-  Timeliness meets the highest European and international dissemination standards.-  A standard daily time is set for the release of European Statistics.-  Periodicity of European Statistics takes into account user requirements as much as possible.-  Any divergence from the dissemination time schedule is publicised in advance, explained and a new release date set.-  Preliminary results of acceptable aggregate quality can be disseminated when considered useful.Principle 14: Coherence and Comparability - European Statistics should be consistent internally, over time and comparable between regions and countries; it should be possible to combine and make joint use of related data from different sources.Indicators-  Statistics are internally coherent and consistent (e.g. arithmetic and accounting identities observed).-  Statistics are coherent or reconcilable over a reasonable period of time.-  Statistics are compiled on the basis of common standards with respect to scope, definitions, units and classifications in the different surveys and sources.-  Statistics from the different surveys and sources are compared and reconciled.-  Cross-national comparability of the data is ensured through periodical exchanges between the European Statistical System and other statistical systems; methodological studies are carried out in close co-operation between the Member States and Eurostat.Principle 15: Accessibility and Clarity – European Statistics should be presented in a clear and understandable form, disseminated in a suitable and convenient manner, available and accessible on an impartial basis with supporting metadata and guidance.Indicators-  Statistics are presented in a form that facilitates proper interpretation and meaningful comparisons.-  Dissemination services use modern information and communication technology and, if appropriate, traditional hard copy.-  Custom-designed analyses are provided when feasible and are made public.-  Access to microdata can be allowed for research purposes. This access is subject to strict protocols.-  Metadata are documented according to standardised metadata systems.-  Users are kept informed on the methodology of statistical processes and the quality of statistical outputs with respect to the ESS quality criteria.[1] COM(2005) 71.[2] Council Regulation (EC) No 322/97 of 17 February 1997 on Community statistics (OJ L 52, 22.2.1997, p. 1).[3] Council Regulation (EC) No 2533/98 of 23 November 1998 concerning the collection of statistical information by the European Central Bank (OJ L 318, 27.11.1998, p. 8).[4] Council Decision 91/116/EEC of 25 February 1991 setting up the European Advisory Committee on statistical information in the economic and social spheres (OJ L 59, 6.3.1991, p. 21).[5] There exists also another body, the Statistical Programme Committee (composed of the Directors-General of the statistical institutes of the Member States), which assists the Commission in the general coordination of the multi-annual statistical programmes and is consulted extensively by the Commission on a wide range of issues (Council Decision 89/382/EEC, Euratom of 19 June 1989, establishing a Committee on the Statistical Programmes of the European Communities - OJ L 181, 28.6.1989, p. 47).[6] There is anyway a need to reform the CEIES, arising from a number of factors, including the enlargement of the European Union (applying the existing rules would make the CEIES “non-operational”), recent developments related to the functioning of the ESS, more effective involvement of all the stakeholders, the need for an increased efficiency.[7] OJ L 112, 29.4.1997, p. 56.[8] Council Regulation (Euratom, EEC) No 1588/90 of 11 June 1990 on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities (OJ L 151, 15.6.1990, p. 1).[9] COM(2005) 24, 2.2.2005 : Working together for growth and jobs – A new start for the Lisbon strategy.[10] COM(2005) 141, 12.4.2005: Integrated Guidelines for Growth and Jobs (2005-2008) including a Commission Recommendation on the broad guidelines for the economic policies of the Member States and the Community and a Proposal for a Council Decision on guidelines for the employment policies of the Member States.[11] COM(2004) 832.[12] OJ C , p. .


title: Commission Recommendation of 22 March 2010 on the scope and effects of legal tender of euro banknotes and coins

text:
               30.3.2010

               EN

               Official Journal of the European Union

               L 83/70

         COMMISSION RECOMMENDATION
   of 22 March 2010
   on the scope and effects of legal tender of euro banknotes and coins
   (2010/191/EU)
   THE EUROPEAN COMMISSION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Article 292 thereof,
   Whereas:

               (1)

               The legal tender status of euro banknotes is laid down by Article 128 of the Treaty on the Functioning of the European Union, in the chapter on monetary policy. According to Article 3(1)(c) of the Treaty on the Functioning of the European Union, the Union shall have exclusive competence as regards monetary policy for the Member States whose currency is the euro (the participating Member States).

               (2)

               According to Article 11 of Council Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro (1), the euro coins shall be the only coins which have the status of legal tender in the participating Member States.

               (3)

               There is currently some uncertainty at euro area level with regards to the scope of legal tender and the consequences thereof.

               (4)

               This recommendation is based on the main conclusions of a report prepared by a working group consisting of representatives from Ministries of Finance and National Central Banks of the euro area.

               (5)

               The Commission will review the implementation of this recommendation three years after its adoption and assess whether regulatory measures are needed.

         HAS ADOPTED THIS RECOMMENDATION:
   1.   Common definition of legal tender

   Where a payment obligation exists, the legal tender of euro banknotes and coins should imply:

               (a)

               Mandatory acceptance:
               The creditor of a payment obligation cannot refuse euro banknotes and coins unless the parties have agreed on other means of payment.

               (b)

               Acceptance at full face value:
               The monetary value of euro banknotes and coins is equal to the amount indicated on the banknotes and coins.

               (c)

               Power to discharge from payment obligations:
               A debtor can discharge himself from a payment obligation by tendering euro banknotes and coins to the creditor.

         2.   Acceptance of payments in euro banknotes and coins in retail transactions

   The acceptance of euro banknotes and coins as means of payments in retail transactions should be the rule. A refusal thereof should be possible only if grounded on reasons related to the ‘good faith principle’ (for example the retailer has no change available).
   3.   Acceptance of high denomination banknotes in retail transactions

   High denomination banknotes should be accepted as means of payment in retail transactions. A refusal thereof should be possible only if grounded on reasons related to the ‘good faith principle’ (for example the face value of the banknote tendered is disproportionate compared to the amount owed to the creditor of the payment).
   4.   Absence of surcharges imposed on the use of euro banknotes and coins

   No surcharges should be imposed on payments with euro banknotes and coins.
   5.   Euro Banknotes stained by Intelligent banknote neutralisation systems (IBNS)

   Even if euro banknotes stained with security ink by Intelligent Banknote Neutralisation Systems (IBNS) are legal tender, Member States should communicate actively towards stakeholders (banks, retailers, general public) that stained banknotes must be brought back to National Central Banks as it is very likely that they are the product of a theft.
   6.   Total destruction of issued notes and coins by individuals

   Member States should neither prohibit nor penalise total destruction of small quantities of euro banknotes or coins by individuals. They should however prohibit unauthorized destruction of large quantities of euro banknotes or coins.
   7.   Mutilation of notes and coins for artistic purposes

   Member States should not encourage mutilation of euro banknotes or coins for artistic purposes but should tolerate it. Such mutilated banknotes or coins should be considered as unfit for circulation.
   8.   Competence to decide on the destruction of fit euro circulation coins

   The decision to destroy fit euro circulation coins should not belong to any national authority in isolation. Prior to the destruction of fit euro circulation coins, the national competent authority should consult the Euro Coin Sub-Committee of the Economic and Financial Committee and inform the Mint Directors Working Group.
   9.   Legal tender of 1 and 2 euro cent coins and rounding rules

   In Member States where rounding regimes have been adopted and prices consequently rounded to the nearest five cents, 1 and 2 euro cent coins should remain legal tender and should continue to be accepted as means of payments. Member States should however refrain from adopting new rounding rules since they affect negatively the power to discharge from a payment obligation by tendering the exact amount owed and since it may lead in some circumstances to a surcharge on cash payments.
   10.   Legal tender of euro collector coins

   Member States should take all measures deemed appropriate to prevent euro collector coins from being used as means of payments (for example special packaging, clear communication, use of precious metal, sale prices above face value).

      This Recommendation is addressed to all euro area Member States, the European Central Bank, European and national trade and consumer associations.
      Done at Brussels, 22 March 2010.

            For the Commission

         Olli REHN

            Member of the Commission

      (1)  OJ L 139, 11.5.1998, p. 1.