Archive:Measuring more than 'just' economic development
- Published in Sigma - The Bulletin of European Statistics, 2010/02
Gross Domestic Product (GDP) is a well-known indicator which measures economic activity. ‘It is a valuable economic indicator which serves a purpose in economic policymaking. Due to the link between economic growth and aspects of quality of life such as employment and consumption, GDP is partly regarded as a proxy indicator of progress and well-being,’ said Walter Radermacher, Director-General of Eurostat.
Introduction
‘However, GDP was never intended to measure, and does not measure, well-being. Neither do GDP estimates include measures of clean environment, sustainability, social cohesion or how happy people are. This means that GDP alone is not enough to properly measure the progress of our society,’ he continued. ‘And a general question for a professional statistician is whether a single figure can truly reflect a complex phenomenon such as progress’.
The European Commission Communication, GDP and Beyond, and the Stiglitz Report focus on how to better measure progress. The statistics they recommend partly overlap with the needs of the Europe 2020 strategy, which focuses on smart, sustainable and inclusive growth.
‘How to best complement GDP to provide a more nuanced and accurate understanding of the growth and progress of society has been on the agenda of statisticians for some years, but now there is political momentum and the statistical world needs to deliver,’ he said.
Mr Radermacher said actions include developments in the fields of national accounts, environmental and social statistics. ‘What is required is a systematic approach, showing the links between the economy and environmental and social sustainability aspects, in order to better inform decisionmakers,’ he added.
Twenty-eight agri-environment indicators
Eurostat, together with the European Commission’s Environment and Agriculture and Rural Development DGs, the Joint Research Centre and the European Environment Agency, started to collect data on 28 agri-environment indicators in 2006, after the Commission had issued a communication on the subject, based on earlier pilot projects.
The indicators are meant to address precise questions related to agricultural driving forces, pressures and benefits, the state and the impact on habitats and biodiversity as well as agri-environment policy responses.
The indicators will help understand how regional farming patterns are developing. They will help assess whether policy or production changes pose risks to the conservation of the environment, or, if they are contributing positively to the preservation and enhancement of environmental resources.
‘We will also know the state of different environmental resources and will be able to focus on the effects of agricultural activities on regional or local environmental resources, as well as the global impact,’ said Mr Ernens.
Finally, the indicators will help assess if agri-environmental policies respond quickly enough to environmental concerns and how changes in, for example, technology affect the system.
The five EU bodies work closely together and Eurostat is responsible for the overall coordination and long-term development of the indicator system. Each service is in turn in charge of developing a number of indicators. Eurostat is, for example, responsible for the indicators related to the European statistical system and the Joint Research Centre is in charge of those indicators which rely on pan-European geo-environmental databases or where models need to be built or research undertaken. The Agriculture and Rural Development DG works with those indicators which are based on administrative information which the directorate-general collects. The Environment DG takes the lead of those indicators where the policy development has been assigned to them, for example on pesticide use, and the European Environment Agency is in charge of those indicators associated with data flows linked to its network Eionet, which includes around 900 experts and more than 300 national institutions.
At the moment Eurostat and the other services are consolidating the selected set of indicators and extending the coverage to all European Member States. Work is also done to improve concepts and methods and to find new data sources or better access to existing data.
Regional data essential
Today 6 of the 28 indicators are ready to use (see box), with well-defined concepts and measurement and with data available at the appropriate regional level.
For many of the other indicators, such as nitrogen balance, energy use, soil erosion and water quality, the availability of regional data is the main issue and needs to be developed. Regional data are of particular importance for agricultural data and especially for the new risk indicators, because Eurostat and the Member States will need to define hotspots and evaluate if policies are efficient, or not, on a finer geographical level.
‘The impact of the same amount of fertiliser is quite different in the French regions of Brittany and the Central Massif. Policymakers also need to see if policies need to be directed to those farmers who are close to water — because of a greater risk of leakage of fertilisers and pesticides — or to all farmers,’ said Mr Selenius.
Farm structure survey as the basis
The main source for Eurostat’s agricultural statistics is the Farm structure survey, which is carried out every three years. Crop and animal production data, agricultural monitoring statistics, and the land use/cover area frame survey (LUCAS) are also important. These ‘regular’ data sources will be used for the agri-environmental indicators as well as the other partners’ databases.
However, there are still many gaps to be filled. One solution has been to attach a module on production methods to the farm structure survey which will be carried out in 2011. It will make available data on, for example, tillage methods, animal husbandry, manure storage and irrigation. A new regulation on pesticide statistics will also provide important data.
‘Existing data sources as well as administrative sources will be explored to the fullest and modelling will be used as much as possible, but unfortunately we will need a few more surveys,’ said Mr Selenius.
He said that Eurostat and its partners are conscious of the potential burden on farmers and always think about how to collect data without disturbing the farmer.
One potential source could be the information farmers are obliged to keep for the cross-compliance controls. In some countries, farmers are, for example, required by law to keep book over how much manure and fertilisers they use and how they use them. However, normally the information is only used if the farm is inspected.
‘In Finland the Statistical Branch of the Ministry of Agriculture is carrying out a pilot study on how to use this information, which reduces the burden for farmers as they do not have to provide the information twice. Furthermore, most farms in Finland use computers, which means the information is digitalised. Therefore, statisticians could extract the information directly from the source. In return, farmers would be given feedback on how much fertiliser they use compared to other farmers, which in the end could save them money.’
Early days
Mr Selenius said that the agri-environmental system is still in its early days. The long-term objective is to have a stable arrangement which provides all the necessary data for the indicators within five years.
‘But, already before that, we should have a database, an indicator section on Eurostat’s website, factsheets with definitions and metadata, and a regular publishing policy. We will, therefore, be able to better monitor the impact of agriculture on the environment.’