Satellite Account of Nonprofit Institutions and Volunteering
Economic activity in the non-profit sector, as measured by gross domestic product (GDP),
recorded solid growth during the late 1990s and early 2000s, according to data on the
economic contribution of non-profit institutions and volunteering.
Between 1997 and 2001, GDP for the core non-profit sector increased at an annual average
rate of 7.1%, slightly faster than the average of 6.1% for the economy as a whole. At
the same time, economic activity generated by hospitals, universities and colleges grew
at a slower pace of 5.4%.
The Satellite Account of Nonprofit Institutions and Volunteering is an extensive
data development initiative in Statistics Canada’s System of National Accounts 1.
The primary aim of the satellite account is to clearly identify the economic contribution
of Canada’s nonprofit sector and allow for an increased understanding of its interaction
with other sectors of the economy. The account contains a set of economic statistics describing
Canada’s nonprofit sector, including a set of standard economic accounts and a nonmarket
extension to put an economic value on unpaid volunteer labour. The advisory
committee guided the development of the satellite account through the sharing of knowledge,
expertise and context relevant to the nonprofit sector.
The results of the Satellite
Account of Nonprofit Institutions and Volunteering are now available for the
years 1997 to 2001 in the first report of an ongoing series of annual releases.
1. Initiation of the Canadian Satellite Account
Project funding for the development of a satellite account within the Canadian System of
National Accounts (SNA) was assured in June 2000 as part of a high-profile joint initiative
between the Canadian government and the Voluntary Sector, the Voluntary Sector Initiative.
The objective of the initiative is to strengthen the capacity of the sector to meet the
demands that society places on it and to enhance the relationship between the federal government
and the sector. The Canadian nonprofit satellite account project was undertaken in direct
response to an identified information gap for policy development vis-à-vis the Voluntary
Sector in Canada.
The satellite account project proposal included a set of standard economic accounts,
mirroring the institutional sector accounts in the core Canadian SNA. It also included
a non-market extension to assign a replacement cost value to volunteer work. Permanent
funding for the Canadian Satellite Account of Nonprofit Institutions and Volunteering
was granted in an announcement from the Prime Minister in December 2001. The announcement
coincided with the signing of an Accord between the Voluntary Sector and the Government
of Canada.
Participation in the Voluntary Sector Initiative enabled the establishment of a high-profile
Advisory Committee for the satellite account, composed
of representatives from the sector, members from other federal departments involved in
related initiatives, and Statistics Canada experts. The committee contributed to the account’s
development by helping to identify the information needs of the sector and other key data
users, sharing expertise on the nature of Canada’s nonprofit sector, and acting
as a sounding board for conceptual and data issues. The committee also provided feedback
from the Canadian perspective on proposed international guidelines in early drafts of
the Handbook on Nonprofit Institutions in the System of National Accounts. Finally,
the committee provided input to the satellite account publication draft and will eventually
help to establish priorities for future development of the account.
VSI participation also provided avenues for input to related statistical initiatives.
Through VSI consultative mechanisms, the satellite account project team provided input
to content development for the Canada Survey of Giving, Volunteering and Participating
(CSGVP). We also had the opportunity to propose content for the first-ever National
Survey of Nonprofit and Voluntary Organizations (NSNVO).
The results of the Satellite Account and the NSNVO were announced on September 20th,
2004.
2. Data Sources and Estimation Strategy
The System of National Accounts provides
a powerful integrating framework for economic statistics on the
nonprofit sector. A wide range of data sources are available on
key dimensions of Canadian nonprofit institutions, and these can
be combined and integrated in an SNA framework to build satellite
account estimates. Confronting multiple data sources in a comprehensive
and coherent accounting system strengthens data quality and allows
for the full exploitation of all available sources.
The standard economic accounts for the
Satellite Account of Nonprofit Institutions and Volunteering draw
heavily on administrative files (tax data) to build estimates,
while alternate sources are used for key segments of the nonprofit
sector or for specific variables in the account. The non-market
extension, to assign a replacement cost value to voluntary labour
contributions, is based on two primary sources, the National Survey
of Giving, Volunteering and Participating and wage rates derived
from the Canadian Census of Population.
Standard Economic Accounts:
Compiling national accounts statistics on Canadian nonprofit
institutions required the development of an extensive infrastructure
to integrate multiple administrative files and other sources.
In Canada, there is no single comprehensive source of administrative
data on nonprofit institutions. Rather they are identifiable on
a range of data-files, none of which is exhaustive and each of
which, taken individually, has important limitations. These files
cover registered charities (the T3010 data file), nonprofit institutions
(the T1044 file), tax-exempt corporations (from T2 Corporate Income
Tax returns and the Generalized Index of Financial Information)
, and public sector bodies eligible for rebates under the Goods
and Services Tax system (the GST Public Sector Bodies Rebate File).
Administrative files containing individual tax returns are provided
in raw, unedited form by the Canadian Revenue Agency. They are
processed, edited and imputed at Statistics Canada then merged
and unduplicated via a unique identifier (the Business Number,
assigned in the Canadian tax system). Industry codes are assigned
via Statistics Canada’s Business Register and wages and
salaries for each employer are obtained from the T4 Statement
of Remuneration and Benefits data file. Supplemental NPIs not
found on the other administrative files are identified on the
T4 file via their industry code according to the North American
Industrial Classification System (NAICS).
With this infrastructure in place, the full universe of records
is filtered to ensure that certain categories of entities that
do not belong in the nonprofit sector are eliminated. Examples
of entities that appear on the administrative files due to their
legal or tax exempt status but are out-of-scope according to the
international definition include: public elementary and secondary
schools and school boards, municipalities and municipal organizations,
federal and provincial government entities, first nations government
entities, pension funds, government business enterprises and other
for-profit entities that may have tax-exempt status.
This universe of nonprofit administrative records and its associated
financial information is heavily exploited to build estimates
for variables throughout the standard economic accounts. In a
number of specific cases, however, either for particular variables
or key segments of the nonprofit universe, alternate sources are
available. The most significant cases are summarized below. As
a general rule, elements of the satellite account not listed here
are estimated using the nonprofit tax record universe described
above.
Specific variables
Transfers (gifts) from households: the tax-receipted
portion of household transfers is built from the point of view
of the payer using tax returns of individuals (the T1 data file)
while the non-tax receipted portion is based on non-profit tax
filer information.
Transfers from governments: built from the point of view of the
payer using federal and provincial public accounts information,
surveys of municipalities and financial statements of municipal
corporations.
Transfers from corporations: based on donations recorded
on corporate tax returns.
Segments of the nonprofit sector:
Hospitals and residential care facilities: Comprehensive
accounts for hospitals and public residential care facilities
are compiled as part of the provincial government health subsector
in the Canadian SNA. Census-type financial information on hospitals
and residential care facilities is collected by the Canadian Institute
for Health Information (CIHI) and Statistics Canada’s Health
Statistics Division and serves as the basis for these estimates.
Universities and colleges: Comprehensive accounts for
universities and colleges are compiled as part of the provincial
government education subsector in the Canadian SNA. Estimates
are based on census-type surveys conducted by Statistics Canada’s
Centre for Education Statistics.
Private elementary and secondary schools: Comprehensive
financial statistics on private, nonprofit elementary and secondary
schools are compiled by Statistics Canada’s Centre for Education
Statistics.
Trade unions: Trade union dues (shown as membership
fees) are reported on the T4 Statement of Remuneration and Benefits
and this is the basis of satellite account estimates.
Political parties: Membership fees and expenditures
of political parties are compiled directly from public financial
statements of federal and provincial parties.
Non-market extension:
For the non-market extension of the satellite account, a replacement
cost value was assigned to hours volunteered by type of organization
from the Canada Survey of Giving, Volunteering and Participating.
The wage rate of community and social services occupations, derived
from the Canadian Census of Population, is used in the valuation.
Wages rates are applied by province to account for regional variations,
and are grossed up for employer contributions to social insurance
schemes.
In the next collection round for the CSGVP slated for the fall
of this year, new information will be collected on hours volunteered
by type of activity. This will enable an improved valuation, as
specific volunteer activities can be matched to corresponding
occupational wage rates, taking into account the range of skills
and contributions offered by volunteers.
3. Future Priorities
Production, incomes and outlays of the
Canadian nonprofit sector were released this year for three reference
years (1997, 1998 and 1999). The nonmarket extension, to put a
replacement cost value on volunteer work is available for reference
years 1997 and 2000. Selected aggregates are available by type
of organization according to the International Classification
of Nonprofit Organizations (ICNPO). Estimates for quasi-public
organizations will be published separately in identifiable sub-accounts.
In the next annual release, two additional reference years will
be added to the time series for the standard accounts.
Another priority is to bring lessons learned
in building the satellite account into the core Canadian SNA.
This will lead to improvements in nonprofit elements in many components
of the system, via data revisions and an eventual redrawing of
sector boundaries in our institutional sector accounts. We also
aim to bring lessons learned to bear on other aspects of the Canadian
statistical system. It is hoped, for example, that work to determine
a universe of nonprofit institutions for the satellite account
and the establishment of a sampling frame for the NSNVO can serve
to improve the nonprofit designation on the Business Register,
the central sampling frame for economic surveys at Statistics
Canada.
Priorities for further development of the satellite account will
be determined in consultation with the Advisory
Committee.
4. Positive Impacts
As will hopefully be evident from what
has been covered, examples of the positive impacts of the Canadian
Satellite Account of Nonprofit Institutions and Volunteering
are many. It demonstrates the power of SNA framework to integrate
data to respond to an important information gap on the nonprofit
sector. It improves the relevance of national accounts information
for policy purposes and brings a new community of users to the
Canadian SNA. Work to develop the satellite account will serve
to improve nonprofit elements throughout the existing National
Accounts programs and the representation of nonprofit institutions
elsewhere in the Canadian statistical system.
Most importantly, carving out a permanent
place for the nonprofit sector in Canadian economic statistics
will serve to raise the profile of the sector and promote an increased
understanding of its role and significance in Canadian society.
1The Satellite Account of
Nonprofit Institutions and Volunteering was developed by a project
team housed in Statistics Canada’s Income and Expenditure
Accounts Division. Team members are Catherine Van Rompaey, Sophie
Joyal, Malika Hamdad, Karen Ashman and Mingyu Yu.
