Statistics NZ’s experience in using Administrative Data in an Integrated Programme of Economic

Vince Galvin General Manager Strategy & Communications

Scope of Presentation

• New Zealand’s system of economic measurement • Measurement challenges and the role of administrative data • Examples of Statistics New Zealand’s use of administrative data

The scope of User Need

The New Zealand System of Economic Statistics

Sustainable Development Indicators Other Satellite Accounts SEEA System of National Accounts-Conceptual Integration National Accounts (incl BoP,GFS) Business Indicator Statistics Price Indexes Business Structural and Performance Statistics Business Register Classifications/Definitions/Methodologies Administrative Record Data (e.g. tax, Customs) Statistical Surveys businesses/households

Significant Issues

• Quality Issues -

“Tired” Designs Needed Integration not “designed in”

• Data Gaps • Capturing structural economic changes effectively • Growing demand from other users – Sub populations, cross cutting topics – Financial position – Linking financial performance with business behaviour • Manage Respondent Burden – Reduction, Communication, Taking advantage of new technology

What might the future look like

• Small Businesses monitored by administrative data • Administrative data used to monitor populations, provide core data across the economy for all units and provide essential size measures for sample surveys.

• Sample surveys focus on complex data for large businesses • Data integration studies to meet detailed analysis needs.

Key idea is that the administrative data goes from being a useful data source to the population definer and major source.

Reasons for Pursuing this idea in NZ

• Characteristics of Administrative data well matched to population management purposes if we can integrate multiple sources • Tax data has value as a “measurement foundation” across industries. Small businesses are simple entities. • We have had considerable success in compiling integrated data sets.

The Potential Contribution of Administrative Data

• Key challenge to manage information about business population dynamics.

– – – –

Measurement done consistently across industries Size and Industry up to date Trace the status of key assets Sub population membership

• Tax data in conjunction with other sources – –

Can trace dynamics of population but can’t provide detailed data on large complex businesses Can provide core data across the economy

A

The Coverage of Administrative data

E Coverage of SNZ Subannual Industry Collections Industry (ANZSIC Division) F G H I J K L M B C D N O P Q

QMS QES QES QES GST GST GST GST EMS EMS EMS EMS QBAS WQS RTS RTS QES QES QES QES QES QES QES QES GST GST GST GST GST GST GST GST EMS EMS EMS EMS EMS EMS EMS EMS QEAS QES GST EMS QES QES QES GST GST GST EMS EMS EMS RTS(pt) QES GST EMS

Value beyond Survey Data

• Linked Employee/Employer database (LEED) – Understanding dynamics of labour market – Contribution to Statistical Infrastructure (geography in business frame, BF structures) • Longitudinal Business Frame (LBF) – More detailed understanding of the Demography of the business population

But of course……….

• The main challenge is identifying a map of the key needs and their implications for the relationships between data sources. Having a serious look at the annual economic collection as a “hub” – Pilot study of how to design links between annual financial performance data and business behaviour data.

– Rationalising the quarterly collection strategy – Annual Economic Survey relationship to quarterly collections.

– Reconsideration of how we use the random number line to minimise sample overlap – Relationship between Commodity information and financial information.

Example 1: The Business Frame

• Range of Improvements implemented – –

Updated size measures, link to population metadata, use of wide range of tax data as “triggers”

• Considerable benefits

Reduction in birth timeliness lag, timeliness of size measure updates, reduced direct surveying, improved population analysis

• Process has enabled introducing new administrative data • The business frame becomes a centre of “concordance management” • Investing in Business Frame Improvements opens the way for the widespread use of administrative data

Business Frame in SNZ

Business Surveys National Accounts Balance of Payments

• • •

Wholesale/Retail Trade Manufacturing Production Surveys

•

Annual Enterprise Survey

•

Annual Frame Update Survey

•

BAI BOP Surveys Business Frame Labour Market and Household Economics Population Census Quarterly Employment Survey, LEED IRD

IRD IRD

Geographic Frame Classifications and Standards

• • • • •

Example 2: The Use of Administrative Data in Survey Design

Estimating economic variables from Tax data – Projecting values in the Retail Trade Monthly Survey – Modeling Quarterly Information – Annual Financial data Confronting high level aggregates Compliance Cost Reductions Improving Methods – Assigning priorities in non-response follow up – Improved imputation Producing Regional Indicator information The main question is now how the availability of data and our information system improvements should change the shape of our survey collection programme.

REDUCTION IN BUSINESS COMPLIANCE COSTS DUE TO THE USE OF TAX DATA

AFUS MFUS AES (Sole traders and partnerships) AES (Companies) QMS RT WT

SIZE

45,000 44,000 9,600 20,000 600 1,000 360

%

34 60 95 50 36 25 20

Example 3: The Agricultural Census

• Resumed after a gap of 7 years • Considerable discussion as to how to construct a frame • Decision taken to use the same approach –

Standard approach helps put units into a slot across the whole frame, using other sources to check coverage

–

Better to take a frame that “over covers” than “under covers”

–

A set of operational “scope and coverage” rules had to be constructed to provide practical ways of bridging the gap between concepts and limitations

To be Continued…………..

• The extent to which the collection programme can be re-shaped is being considered.

• Information demands increase, compliance cost concerns still significant • The increased use of administrative data in individual surveys has provided a useful set of experiences in terms of understanding the uses to which administrative data can be put in terms within our current framework • The uses have highlighted that it is sensible to consider going further in basing our collection strategy around administrative data. Attitude has been surprisingly important.

• The investment in the Business Frame and success with data integration projects had put some of the infrastructure in place which has created options.