System of Environmental Economic Accounts SEEA

1. System of Environmental Economic Accounts SEEA The measurement framework for the environment and its interactions with the economy Peter Harper Chair UNCEEA Deputy Australian Statistician Australian Bureau of Statistics

2. ‘What we measure affects what we do; and if our measurements are flawed, decisions may be distorted. Choices between promoting GDP and protecting the environment may be false choices once environmental degradation is appropriately included in our measurement of economic performance. So too, we often draw inferences about what are good policies by looking at what policies have promoted economic growth; but if our metrics of performance are flawed, so too may be the inferences that we draw.’ Stiglitz et al ‘A country could exhaust its mineral resources, cut down its forests, erode its soil, pollute its aquifers, and hunt its wildlife to extinction, but measured income would not be affected as these assets disappeared.’ Repetto et al ` What do we care about?… and do our targets reflect this?

3. Data users Is there an issue? Yes Advice Analysis Research Information Audiences for information… Indicators and Accounts Headline indicators Decision makers & wider public Indicators on specific subjects or industries Indicators Managers and analysts SEEA Standard tables Supplementary tables Researchers Data items

4. Information is vital…and it needs to be integrated The economy impacts on the environment and the environment impacts on the economy To understand these linkages we need to integrate environmental and economic information This is the explicit purpose of the SEEA framework

5. Problem: Information silos • Data developed to answer one particular question or problem • Difficult to figure out if all information is included • Not always easy to see the whole picture, or how it relates to other things

6. Solution: Integrated information Help to make sense of the larger picture Help to identify pieces that are missing Can make connections to other statistics - especially economic statistics

7. Linking environmental and socio-economic data is essential for policymakers enables analysis of the impact of economic policies on the environment and vice versa provides a quantitative basis for policy design identifies the socio-economic drivers, pressures, impacts and responses affecting the environment supports greater precision for environmental regulations and resource management strategies provides indicators that express the relationships between the environment and the economy

8. DPSIR framework Socio-economic Biophysical

9. Using a standard is very important… Organising information within the SEEA framework ensures Consistency (with existing standards eg SNA) Completeness (no gaps, or at least known gaps) Comparability (across time and space) Accountability (industry, governments, h/holds)

10. The SEEA standard Developed by UNSD, NSOs, Eurostat, OECD, IMF, World Bank 1993 Handbook – satellite to SNA 2003 Updated SEEA handbook – manual of best practices 2006 UNSC decided to elevate SEEA to an international standard 2012 SEEA – The Central Framework Chapter 1 – Introduction Chapter 2 – Accounting structure Chapter 3 – Physical supply and use Chapter 4 – Monetary transactions Chapter 5 – Asset accounts Chapter 6 – Sequence of accounts, aggregates and indicators 2013 SEEA – Experimental Ecosystem Accounts 2013 SEEA – Applications and Policy Uses Subsystems: SEEA-Water, SEEA-Energy, SEEA-Material flows (MFA), SEEA-Agriculture

11. The SEEA central framework incorporates four types of accounts. Flow accounts: supply and use tables for products, natural resources, ecosystem inputs and residuals or wastes from economic activities. physical (e.g. GL of water) and/or monetary values Stock accounts for environmental assets: natural resources, land and ecosystems. physical and/or monetary values Activity / purpose accounts that explicitly identify environmental transactions already existing in the SNA. e.g. Environmental Protection Expenditure (EPE) accounts Environmentally adjusted accounts that adjust SNA economic accounts to reflect the impact of economic activity on the environment. e.g. for environmental depletion and degradation

12. Ecosystem services Ecosystem services are “fundamental life-support services upon which human civilization depends”, and can be direct or indirect. Broad examples include: • Regulating (climate, floods, nutrient balance, water filtration) • Provisioning (food, medicine, fur, minerals) • Cultural (science, spiritual, ceremonial, recreation, aesthetic) • Supporting (nutrient cycling, photosynthesis, soil formation)

13. Take home messages… • Integrating environmental and economic information is vital for informed, sophisticated decision-making • SEEA is an internationally recognised standard explicitly designed for this purpose • SEEA is an accounting standard, not an ideology • SEEA enables a wide range of issues to be studied, including sustainability, well-being and green growth