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Household Final Consumption Estimates (HHFCE) Work Programme

This short note outlines some of the key outputs and responsibilities of the Office for National Statistics (ONS) HHFCE Branch including the production of Household Final Consumption Expenditures (HHFCE) estimates.

It also summarises what work is underway within ONS to further develop and improve the outputs to address existing limitations and also prepare for future changes (including the implementation of  European statistical requirements).

This will help users understand the limitations of the currently published estimates, but also to highlight  developments that will improve the estimates. As progress is made with the improvements listed below, ONS will provide updates and share information on the extent of planned revisions.

Key outputs and responsibilities for Household Final Consumption Expenditure

Primary objectives of HHFCE team

Household Final Consumption Expenditure is part of National Accounts, its responsibilities include:

  • processing of Household Final Consumption expenditure estimates to be included in the quarterly GDP releases

  • provide supply and use balanced household final consumption expenditure estimates for Blue Book 2012, and incorporate the larger scope of revised periods to be included in Blue Book 2013.  A description of the supply and use process can be found in the Input Output Supply and Use Tables

  • review methodology in household expenditure for National Accounts to ensure a robust set of estimates

  • publish Consumer Trends/HHFCE estimates presenting a comprehensive set of estimates of household final consumption quarterly, in line with the National Accounts schedule

  • produce estimates which conform to the European System of Accounts 1995 (ESA95) Classification of individual Consumption by Purpose (COICOP) - ongoing

  • production and delivery of HHFCE data to Eurostat - this delivery is required to comply with European legislation

Planned improvements to household final consumption expenditure - statutory to meet Eurostat requirements

The improvements for Eurostat require a redesign of the systems and methodology currently being used. As a result there is a large amount of resource committed to enable ONS to meet its target for inclusion in Blue Book 2014.

Eurostat

  • creating and implementing new improved methodology for the motor trades estimates

  • investigation and analysis of new source data, to improve estimates of Owner-Occupied housing (Imputed rentals)

  • investigation and analysis for improvements to estimates for maintenance and repair of dwellings

HHFCE development projects

The outcome of this work is planned to be implemented as part of production of Blue Book 2013:

  • review of Department of Energy and Climate Change (DECC) data in HHFCE to ensure the most robust estimates of Electricity, Gas and  Other Fuels are produced

  • the inclusion of improved data sources and methodology within COICOP 08 - Communications

  • before Blue Book 2011, a range of existing price indices were used to construct deflators for the components of HHFCE/GDP. The reasons why ONS has improved deflation methods by harmonising the price indices used (where possible) for Blue Book 2011 are set out in Drew (2011). This includes the use of the CPI for deflation of most HHFCE data in preference to the RPI used previously. The harmonisation of the CPI, RPI and HHFCE implied deflator is important to the Bank of England, as a result HHFCE have committed to continue ongoing analysis of the three measures

  • as part of the successful United Kingdom Statistics Authority assessment, HHFCE plan to further engage with key users/stakeholders, by conducting a seminar for customers and suppliers post publication of Blue Book 2012. Dates for these seminars will be published

  • a new system for the compilation for National Accounts was introduced from 2011 Q2, as a result the production of estimates of On Trade alcohol expenditure are no longer available. The re-introduction of these series is resource intensive and will require the redesign of methods and systems. HHFCE are not currently resourced to undertake this work before the publication of the annual Blue Book 2012, scheduled for 31 July 2012. HHFCE will consider the work required and the specification will be shared with interested parties

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