How to

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How to educate the users to the potential of
using environmental accounts for development
policies the case of Italy
Cesare Costantino
10th London Group Meeting
United Nations Headquarter Complex
New York, 10-21 June 2006
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Educating the users a special issue for
environmental accounting
SEEA Chapter 11
(on applications and policy uses)
examples
what can reasonably be done by statistical
offices on their own and what they would have to
undertake in collaboration with other agencies
Issues included in the research agenda
need for educating the users to the potential
of using the accounting approach for analysis and
policy making
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The Italian experience

• Promotion

• Adoption of high level decisions

• Discussion in the Parliament

how to make users aware about the potential of
using environmental accounts still a crucial
issue in Italy
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Joint work by Istat and the Ministry of Economy
and Finance

• project launched in autumn 2004

• aimed at identifying ways in which environmental
  accounting can improve the design, monitoring and
  evaluation of development policies

• national knowledge management program adopted by
  the CIPE

• follow up launched in spring 2006

Difficulties in managing the financial resources
obtained
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Istats partner in the project
Ministry of Economy and Finance (MEF)
Department for Development and Cohesion Policies
Public Investment Technical Evaluation and
Monitoring Unit
Public Investment Evaluation Unit (UVAL)
UVAL provides

• technical support to public administrations.
  Specific tasks include to help improve effective
  spending and to favour better performance of
  European structural funds

• evaluations of various aspects of investment
  programmes and development projects

especially interested in regional environmental
accounts
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Main results of the Istat - Ministry of Economy
and Finance joint project
Specific objectives reached

• defined a framework

• identified a subset of environmental accounting
  aggregates especially important for development
  policies

• calculated, on an experimental basis and by way
  of example, regional estimates of some of the
  aggregates identified as especially important

• formulated general hypotheses in order to start
  up a system of periodic production of selected
  environmental accounting data on a regional scale

• disseminated a methodological document
  Development policies and the environment using
  environmental accounts for better decision
  making (htpp//www.dps.mef.gov.it/materialiuval)

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Main steps of the joint work

• concept of development policy in operational
  terms

• UVAL experts aware about the features of
  environm. accounting and the specific outputs
  stemming from it

• examples of policy-makers questions concerning
  environmental issues, to which environmental
  accounting data can provide proper answers

• generalising of the policy-makers demand and
  the corresponding supply by environm. accountants

• priorities for further work on environmental
  accounting at Istat

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Operational definition of the development policy
concept
focus on capital
government decisions aimed at either directly or
indirectly helping to conserve and increase the
stock of public and private capital
enlarged concept of capital
produced capital, human capital, natural capital,
knowledge capital, social capital
the natural capital
according to the SEEA concept and guidelines
(e.g. 1.23 of the handbook on the different
functions of the natural capital)
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Main features of development policies

• objectives

conservation/ growth of the capital stock
(different forms)
conservation/ growth of the stock of a given form
of cap (specific components)
reduction of territorial disparities concerning
capital stock

• target groups

different institutional sectors, different
industries, different social groups

• instruments

public expenditure
fiscal system
regulation
public help for capacity building
focus on allocation of expenditure to stocks of
capital, sectors, territories
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Allocative decisions by kind and related
policy-maker questions
kind of allocation examples of questions
among different forms of capital Which share of the materials used in production and consumption processes ends up in residuals and which share is turned into produced capital? To what extent is the natural resources intake needed to satisfy the key economic sectors requirements?
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Allocative decisions by kind and related
policy-maker questions
kind of allocation examples of questions
among different target groups What is the relationship between the economic performance and the environmental performance of various production activities? Are the economic activities that pollute the most the same ones that spend the most on environmental protection?
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Allocative decisions by kind and related
policy-maker questions
kind of allocation examples of questions
among distinct territories Are there significant differences among territories in terms of the availability of various natural resources and their quality? Are the territories with the greatest pollution and degradation the same ones that spend the most on environmental protection?
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Answers from environmental accounts
SEEA and ESEA
stress on main topics addressed, main phenomena
described and their type, stage of the DPSIR
circuit at issue
framework
environmental accounting modules for which
handbooks, compilation guides, standard tables
are available within the ESS EW-MFA, NAMEA,
EPEA, asset accounts
focus on
- direct use of empirical evidence provided by
env. accounts - indirect use of data provided by
env. accounts as an input for modelling
how
examples
based on data regularly produced by Istat
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Questions-answers a framework
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The potential of using env. accounts at the
individual decision stages
Choice of objectives

• allocation of resources among forms of capital

the information provided by environmental
accounts for the different forms of natural
capital is of crucial importance, because the
degradation of the natural resources in question
can, in the medium- to long-term, compromise the
prospects for development of key economic sectors

• allocation of resources among territories

the information makes it possible to take into
account the differences in the respective
environmental situations deemed capable of
impacting on the gaps in development
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The potential of using env. accounts at the
individual decision stages
Choice of policy instruments

• choice of mechanism (expenditure, fiscal and/or
  regulation policies)

the information provided by environmental
accounts is deemed reduced

• choice of target groups

the information appears especially important.
Environmental accounts can also provide
indications for the fine-tuning of the parameters
of intervention tools (for example, determination
of the price changes needed to bring about
changes in behaviour)
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Value added of the individual environmental
accounts
In relation to allocative decisions

• environmental accounts able, by their very
  nature, to provide useful support for some
  decisions, not for others

• able to provide useful support by favouring the
  reading of certain information at times and the
  reading of other information at other times they
  can be read at various levels and for various
  objectives

• able to provide information not otherwise
  available from other sources

• able to provide more complete and/or more
  detailed information compared with other sources

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Value added of the individual environmental
accounts
For purposes of ex post evaluation of development
policies

• the potential of using environmental accounts
  appears to be reduced, due to the difficulty of
  distinguishing the effects of the public
  intervention and effects originating from other
  causes

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A prioritisation exercise
key factors importance for development policies,
feasibility
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The case of Italy some lessons learnt

• Users interest

• money for the project obtained from a public
  fund for the enhancement of knowledge in general,
  not from a budget specific for environmental
  issues

• users willingness to assess the potential of
  using environmental accounts due to their
  involvement in public expenditure

• Users capacity to understand environm.
  accounting

• examples of policy-makers questions concerning
  environmental issues to which environmental
  accounting data can provide proper answers

• calculation of indicators identified as
  especially important

• focus on data regularly produced

• Funding

• after all, despite the Ministrys willingness to
  pay, the society on the one hand and the
  statistical system on the other hand are not
  really engaged in developing environmental
  accounts and their use

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questions/points for discussion

• How to arouse users interest

• focusing on the need to integrate environmental
  and economic aspects as a standing alone point,
  or making a major effort to address knowledge
  issues with reference to overall sustainable
  development?

• are there specific users interests (e.g.
  improving public expenditure) on which it is
  advisable to focus on?

• Finding best ways to dialogue with users

• to make use of a questions-answers framework?

• to avoid controversial issues, starting
  discussion from those accounts for which
  handbooks, compilation guides, standard tables
  are available,?

• to concentrate on environmental
  accounts/aggregates deemed especially important?

• to start discussion from those accounts that are
  already produced on a regular basis?

• what else?

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questions/points for discussion

• To develop methodological documents
  specifically aimed at educating users?

• Can an action aimed at educating users help to
  elevate the SEEA to an international statistical
  standard? and if so, how?

• How to make the society and the statistical
  system actually engaged in developing
  environmental accounts and their use?

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Thank you for your kind attention