ONS Economic Forum

Email: economicforum@ons.gov.uk

Twitter: @ONS

#ONSeconomy

Website: http://www.ons.gov.uk/ons/about-ons/get-

involved/events/events/economic-forum/index.html

8 October 2014

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What’s next

ONS Economic Forum

8 October 2014

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Flow of Funds

Nick Vaughan:

Director, National Accounts & Economic Statistics

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Objectives of session

• The Flow of Funds – what is it and why is it

important?

• What do we want to develop?

• Current and future plans – How will we get

there?

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What is Flow of Funds?

• Measures financial flows and levels across sectors of

the economy - provides information on debtor/creditor

relationships and changes in financial assets &

liabilities

• Exists to some extent already in the UK Economic

Accounts publication – ONS publish financial

accounts and balance sheets for each sector of the

economy on a quarterly and annual basis;

- Sectors include; Public Corps, Private Non

Financial Corps, Financial Corps, Government,

Households, NPISH, Rest of the World

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Why is it important?

The recent financial crisis exposed a significant lack of

information within the financial sector.

Expanding Flow of Funds is essential for:

• identifying the build-up of risks in the financial sector

• detecting emerging imbalances between sectors

• investigating trends in balance sheet positions

• macroeconomic & macro-prudential policymaking

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What do we want to develop?

• The UK accounts do not currently show counterpart

data

• Want to implement Flow of Funds matrices for each

financial instrument that show counterpart

information, ie accounts published on a whom-2-

whom basis

• Develop 2 new accounts; Revaluation (nominal

holdings & gains) and Change in Volume of Assets &

Liabilities; part of the full sequence of accounts

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A Flow of Funds matrix – example

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How will we get there?

• Publishing new tables as part of Blue Book 2014 – dedicated Flow

of Funds chapter (14)

• Tables will show data already published in the accounts BUT in a

different format as requested by key users

• Work with our users; Bank, Treasury, BIS and OBR – includes

launch of working group and allocation of resources in both ONS

and Bank of England

• Re-development of ONS suite of financial surveys

• Investigation into use of administrative data/Big data

• Learn from other National Statistical Institutions through liaison

with EU member states and wider

• For more information please e-mail

“FlowOfFundsDevelopment@ons.gsi.gov.uk”

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Economic wellbeing

Valerie Fender - Economic Adviser, Economic Wellbeing

ONS Economic Forum

8 October 2014

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Economic Well-being: Background

• GDP inevitably and correctly plays a central role in monetary

and fiscal policy

• Traditional measures of progress such as GDP are

increasingly considered an incomplete picture of well-being

• Additional economic, social and environmental measures are

needed alongside GDP to provide a complete picture of how

society is doing

• UK’s Measuring National Well-being (MNW) Programme was

launched in November 2010 to take this work forward

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Economic Well-being: Work to date

• Economic Well-being article in April 2014

• Development Measuring National Well-being

domains – Economy and other relevant

• Development of a framework for economic

well-being

• Selection of an indicator set

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Objective and Subjective measures

Emphasising the Household Perspective

Economic Well - being

Current Future Equality

Way forward

• Methods and concepts article published in

November 2014

• Regular publication of the additional

measures – Quarterly release from 23rd

December 2014.

• Continue to develop and refine additional

measures

• natural and human capital

• measures of unpaid household work

• Review headline measures of Measuring

National Well-being

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