Hungary has been a subscriber to the International Monetary Fund's (IMF) Special Data Dissemination Standard (SDDS) since 1996 and first met SDDS data specifications in 2000. According to the IMF SDDS website, Hungary meets or exceeds requirements for coverage, periodicity, and timeliness, and avails itself of no flexibility options. Advance-release calendars are available, and simultaneous release of data is the rule. Hungary regularly updates the metadata and summary methodologies that it posts on the SDDS website. While issues remain regarding data quality, Hungary continues to make progress in addressing them, according to the 2007 Article IV Consultation report issued by the IMF.

General Overview

As written in the 2007 Article IV Consultation report by the International Monetary Fund (IMF) and on the IMF's Special Data Dissemination Standard (SDDS) website, Hungary has been a subscriber to the SDDS since 1996. The data posted on the SDDS site meet or exceed SDDS specifications for coverage, periodicity, and timeliness of data. Hungary disseminates advance release calendars and summary methodologies for all requisite datasets. As the "Statistical Annex" of the 2007 IMF report notes, the data "facilitates effective surveillance" (p. 5). The SDDS website further discloses that Hungary avails itself of no flexibility options.

The IMF conducted its initial Report on the Observance of Standards and Codes (ROSC) covering data dissemination in Hungary in 2001, and has issued updates at least yearly from 2002 to 2004. The 2004 ROSC Update notes that "the metadata and summary methodologies underlying the economic statistics are regularly updated on the IMF's Dissemination Standards Bulletin Board" (p.1). In the 2007 Article IV Consultation, the IMF reports that "most data quality issues noted in the data module of the 2001 Report on the Observance of Standards and Codes (ROSC) have been satisfactorily addressed, but some still remain" (p. 5). Improvements were reported in the area of real sector data, balance of payments, the monetary sector, and government finance statistics. The 2007 IMF report notes that the Central Statistical Office (CSO) had begun using chain-linked indices in compliance with Eurostat requirements. It had also changed the methodology used to compile GDP, switching to the use of current-price estimations and has introduced refinements in the way it measures certain government services and financial intermediation services. The report adds that illegal activities are now accounted for in the national accounts. The report also noted an issue with the computation of imputed rents for owner-occupied homes, stating that it "is based on the average price changes of different repair items and does not cover all elements of costs to the user."

According to the 2007 IMF report, the Magyar Nemzetti Bank (NMB), Hungary's central bank, began a new system for the collection of balance of payments and international investment position statistics in 2005. The goal is to complete transitioning to direct reporting by 2008. Working with the CSO, the MND has also begun to change its system of data collection for the international trade in services. Other changes include the way in which the MNB reports stock and flow data for special-purpose entities (SPEs), including them in its balance-of-payments data. The 2007 report adds that "the MNB continues to treat the statistics that exclude the flow and stock data of SPEs as readily interpretable in economic terms" (p. 6). Monetary sector data are now compiled and published according to a methodology that follows the European Central Bank (ECB) standard. They also now include money market funds. Improvements have been made in the reporting of securities on the balance sheets of depository corporations, adopting a market-price valuation at the recommendation of the IMF's Statistical Department. The reporting of budget execution and government finance data is also improving. According to the 2007 report, "these improvements relate mainly to institutional coverage of general government, consolidation of data and reconciliation of deficit and financing. However, plans to report monthly expenditures classified on an economic basis have yet to come to fruition" (p. 6). Government finance statistics data include coverage of the operations of the consolidated government and consolidated general government sectors and their subsectors. Since 2000, these data are compiled using an accrual-based methodology and follow the formal of the Government Finance Statistics Manual, 2001 edition.

The 1993 Act on Statistics governs the scope and rules of statistical activity, and stipulates the agencies empowered to carry such activities out. Chief among these is the CSO, which also works to harmonize the statistical work done in other agencies and foster professional development in the field. The Act grants to the CSO the right to receive information from statistical agencies, which must provide the requested data. By the terms of the Act, the CSO is independent and enjoys a nationwide scope of authority. The law enumerates the specific tasks and functions for the CSO. These include compilation, processing, and dissemination of data, data protection, survey design and implementation, coordination of all statistical activities in the country, and the ongoing professional development of methodologies, concepts, and classifications. The CSO website discloses that the Office works with the National Statistical Council (NSC) and reports annually to both the legislative and executive branches of government regarding Hungary's social, economic, and demographic data. It also contributes to the formulation of statistics-related legislation.

The CSO website describes the NSC as a "professional advisory body" that serves the president of the CSO. Members of the NSC are drawn from a range of backgrounds, including representatives of other statistical service agencies, trade associations, academia, and professional experts. Nominees for membership are submitted by the CSO president and are appointed by the Prime Minister to serve a three-year term. Also according to the CSO website, the Office works with contacts in Eurostat to develop its competencies in the methodologies, technology, and professional standards employed within the European Statistical System. The data that the CSO provides regularly to Eurostat is, for the most part, compliant with European Union requirements. The CSO also works with other international standard-setting organizations, including the IMF and specialized agencies within the United Nations.

The Principles

Comprehensive economic and financial data, disseminated on a timely basis.

FC

As noted in the 2007 Article IV Consultation report by the IMF and disclosed on the IMF's Special Data Dissemination Standard (SDDS) website, Hungary has been a subscriber to the SDDS since 1996. The data posted on the SDDS site meet or exceed SDDS specifications for coverage, periodicity, and timeliness of data. Hungary disseminates advance release calendars for all requisite datasets, and as the "Statistical Annex" of the 2007 IMF report notes, the data "facilitates effective surveillance" (p. 5).

Ready and equal access to official statistics.

FC

The IMF SDDS website discloses that Hungary disseminates advance release calendars for all relevant datasets and provides simultaneous release of data. The MNB issues special reports containing daily rates for central bank interest rates, T-bill and government bond yields, and interbank money-market interest rates, and most of this data is also published in the larger Hungarian newspapers. The public can access these by contacting the appropriate MNB representative. The MNB also issues a monthly press release covering official money-market rates, household and nonfinancial corporate deposits, and loan interest rates. These data are also publicly available on the MNB website. Daily interbank lending rate data is accessible via Reuters or by special request through the MNB. Daily stock market share price data can be requested from the MNB, which also publishes the Budapest Stock Exchange share price index data online.

The 2004 IMF ROSC designated as a "Substantive Update on Government Finance Statistics" found public access to data to be "satisfactory" (p. 8), but added that access to metadata "needs to be improved" (p. 9). The rules of presentation covering execution data on the annual budget are set forth in the Act on Public Finance. The 2004 report noted, and the SDDS website confirms, that the website provides contact information for all SDDS data categories, should individual users need more information. Still, the report observed that only "limited general-use information about public sector statistics and no specialized-use information are made available to the public" (p. 9), nor does the Ministry of Finance (MoF) provide a comprehensive catalog of the statistical products and services that it provides.

Official statistics must have the confidence of their users. Transparency of its practices and procedures is a key factor.

CP

The IMF SDDS website shows that the terms governing statistical production are made public, although in many cases this is done as a public service rather than as a legal requirement. The website also discloses that confidentiality is protected through the provisions of a number of laws, including the Act on Statistics, the Act on the MNB, and the Act on the Protection of Personal Data and the Disclosure of Data of Public Interest. Internal government access prior to general release is publicly acknowledged and, except for the case of central government operations data, no commentary is attached. In the case of central government operations data, the MoF provides commentary along with the press release, in which operations outcomes are discussed and unusual circumstances affecting budgetary revenues and expenditures are explained. Information about data revision is made available to the public. Methodological changes are also announced. However, it is not clear from the information on the IMF's SDDS website as to whether there is advance notification for changes in methodology for several data categories.

The IMF's 2004 ROSC "Substantive Update" states that legal and institutional environment clearly establishes the MoF's responsibility to compile and disseminate fiscal data, but there is no legal obligation to make statistical data publicly available. Such access is provided as a public service, according to the SDDS website. Data on government finance statistics for the central and general government, as well as budget execution data, are legally assigned to the MoF's Directorate of Fiscal and Financial Policy Affairs, according to the 2004 "Substantive Update," which also notes that the Government Debt Management Agency (AKK) is assigned the job of compiling and disseminating central government debt data. The same report describes both the MoF and the AKK as exhibiting professionalism. Their statistical responsibilities, particularly with regard to impartiality and technical criteria, are in part governed by the Act on Public Finance, as well as by the more specifically statistically related legislation. Central bank statistical data compilation and dissemination, including confidentiality provisions, is also covered by provisions of the Act on the MNB.

The "Substantive Update" ROSC of 2004 notes that transparency is further enhanced by the fact that legislation governing the compilation of budget execution data is available to the public. The ROSC notes that although the public is not officially told of early government official access to certain budget execution data, it is understood as required for the preparation of final accounts. Statistics reported to international organizations are not subject to prior government release. As the ROSC Substantive Update notes, the Act on the Legal Status of civil Servants and the Code of Ethics for Civil Servants provide guidance on ethical standards to be followed in compiling and disseminating budget execution and government finance statistical data.

A set of standards that deals with the coverage, periodicity and timeliness of data must also address the quality of statistics.

CP

The IMF SDDS website discloses that Hungary provides, at a minimum, summary methodologies for every dataset, and greater detail is available for many data categories. This information is also available on the relevant government websites. However, there is no information regarding component detail, reconciliation practices, or other cross-checking mechanisms for producer price index data, exchange rate, or social and demographic data.

The IMF's 2004 ROSC Data Module Update reports that most of the problems with data quality in Hungary that were disclosed by the initial 2001 ROSC have been addressed. During its preparation to join the European Union (EU) Hungary had to make changes in its procedures and methodology in order to harmonize with EU institutional practice. The report adds that issues of inconsistency across datasets "have been effectively addressed through closer cooperation between the national data collection and dissemination agencies" (p. 4). However, the 2004 ROSC "Substantive Update" notes that, with regard to budget execution data, "there is no systematic consultation with users" (p. 6). The report does stress that the MoF is committed to producing quality data on budget execution and is aware of the central importance of quality source data and methodological practices to achieve this end. Accordingly, the "Substantive Update notes that the MoF "make[s] continuous efforts to improve them" (p. 6).

According to the 2007 IMF report, the NMB began a new system for collection of balance of payments and international investment position statistics in 2005. The goal is to complete transitioning to direct reporting by 2008. Working with the CSO, the MND has also begun to change its system of data collection for international trade in services. Other changes include the way in which the MNB reports stock and flow data for SPEs, including them in its balance-of-payments data. The 2007 report adds that "the MNB continues to treat the statistics that exclude the flow and stock data of SPEs as readily interpretable in economic terms" (p. 6). Monetary sector data are now compiled and published according to a methodology that follows the ECB standard. They also now include money market funds. Improvements have been made in the reporting of securities on the balance sheets of depository corporations, adopting a market-price valuation at the recommendation of the IMF's Statistical Department. Also undergoing improvement has been the reporting of budget execution and government finance data. According to the 2007 report, "these improvements relate mainly to institutional coverage of general government, consolidation of data and reconciliation of deficit and financing. However, plans to report monthly expenditures classified on an economic basis have yet to come to fruition" (p. 6). Government finance statistics data include coverage of the operations of the consolidated government and consolidated general government sectors and their subsectors. Since 2000, these data are compiled using an accrual-based methodology and follow the formal of the Government Finance Statistics Manual, 2001 edition.