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National Accounts Classifications

The UK National Accounts are produced under internationally agreed guidance and rules set out principally in the European System of Accounts 1995 (ESA 95), and the accompanying Manual on Government Deficit and Debt (MGDD).

These rules apply to all countries in the European Union, and the UK is legally required to produce the National Accounts on an ESA 95 basis.

In the UK the Office for National Statistics (ONS) is responsible for the application and interpretation of these rules.

The Government has chosen to base its departmental budgeting rules and fiscal statistics on National Accounts principles, consequently ONS decisions on how things are treated in the National Accounts underpin both the outturn figures in the joint HM Treasury (HMT)-ONS Public Sector Finances publications, and the forecast data published by the independent Office of Budget Responsibility (OBR), as well as informing the public sector boundary used in the production of Whole of Government Accounts (WGA).

Classification decisions also feed into a wide range of ONS economic statistics - the National Accounts themselves, public sector employment, etc.

Under ESA 95, all institutional units operating within an economy are classified by ONS to one of six sectors (and sub-sectors). The sectors are:

  • General Government

  • Non-Financial Corporations

  • Financial Corporations

  • Households

  • Non-Profit Institutions Serving Households; and

  • Rest of the World

The Public sector includes all units within General Government, as well as bodies classified as public non-financial corporations (for example, Royal Mail plc) or public financial corporations (such as the Bank of England or the Royal Bank of Scotland).

All transactions between the different sectors of the economy are also classified.

ONS makes classification decisions on whether payments to government are taxes or not (and what type of tax), on how to record things like privatisations, fines, compensation payments, pension contributions, student loans and other benefits, as well as payments between the other sectors of the economy.

Cases which are not straightforward are referred to the National Accounts Classification Committee. More information on how ONS reaches classification decisions can be found in the ONS Classification Process.

National Accounts classification decisions can have a large impact on key economic statistics, and so classification decisions are considered carefully and those with a significant impact are authorised at a senior level in the office.

These pages detail information on major classification decisions taken in recent years; documentation on the classification process; and a list of entities and their classification in the UK National Accounts.

Content from the Office for National Statistics.
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