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Gross Domestic Product: September 2016 quarter
Embargoed until 10:45am  –  22 December 2016
Revisions

Overview

Several revisions to previously published data are incorporated in this release. These revisions come from three sources:

  • quarterly series reconciled to new annual benchmark data
  • methodology improvements and changes to data sources
  • updated indicator data.

In general, methodology improvements affected the whole time series; reconciliation to new annual benchmarks primarily caused revisions to recent years (2013 onwards); and updated indicator data caused revisions to recent quarters. We discuss the key revisions in the sections below.

Graph, Gross domestic product, annual growth, March 2006 to March 2016.

Quarterly series reconciled to new annual benchmark data

In the September quarter of each year, we reconcile quarterly constant price series to new annual national accounts data which have been through the process of supply-use balancing. This reconciliation is essential to maintain the quality of the quarterly series over time.

The new annual data come from National Accounts (Industry Production and Investment): Year ended March 2015 and National Accounts (Income and Expenditure): Year ended March 2016 published on 8 December 2016. Note that for most of the production-side benchmarks, we incorporated balanced data only up to 2014 in the quarterly volume estimates. Provisional estimates (2015 and 2016 annual data) are subject to more revision than final reconciled data.

Not all industries are reconciled to the annual national accounts data. The methods we use to calculate the annual contribution to GDP by industry vary – some industries use annual national accounts data, while others use other data sources. However, all industries and components are affected by an update in the weights used for chain-linking, which allows the relative size of each lower-level series to be reflected in the industry and component aggregates. More information on the methods used for calculating each industry of GDP, and each component of the expenditure measure of GDP, is in Quarterly gross domestic product: Sources and methods (fourth edition), which will be updated in early 2017 to incorporate recent methodology changes.

Methodology improvements and changes to data sources

In addition to the annual benchmark updates, we implemented several methodology changes that led to revisions to GDP series. These changes are outlined in the section below. Preview of 2016 national accounts improvements provides more detail on the changes made this quarter.

Construction industry

Changes to the construction industry introduced in the September 2016 quarter were:

  • Benchmarking the construction services sub-industry to annual value added (where previously there was no annual benchmark), causing revisions to annual construction volumes. Revisions affect the whole time series.
  • Revising quarterly indicator data for residential building construction and residential building investment back to 2012, to align seasonally adjusted outputs more closely with those published in Value of Building Work Put in Place.
  • Changing the seasonal adjustment for the construction industry from indirect to direct. As total GDP and GDE are directly seasonally adjusted, these changes did not affect either total.

Mining

We aligned oil and gas production indicators more closely with those published in the Ministry of Business, Innovation and Employment’s New Zealand Energy Quarterly. This resulted in revisions to the mining industry across the time series.

Central government final consumption expenditure

Updates to data and classifications resulted in revisions to current price and volume estimates of central government final consumption expenditure for the whole time series, on the expenditure side of GDP only.

Removal of fixed weights

We introduced chain-linking to replace fixed 2010 weights for lower-level series in the mining and business services industries on the production side of GDP. We also introduced chain-linking to some parts of both non-residential building GFKF, and central government final consumption expenditure. Removal of fixed weights results in revisions to the whole time series.

More minor methodology changes:

  • updated travel credit proportions were incorporated into our measures of household consumption expenditure, but the effect on HCE totals was minor
  • updated annual school education data (2011–15) with data sourced from the Ministry of Education
  • introduced seasonal adjustment for investment in other construction.

Revisions to GDP

  • Updated respondent information and other source data also resulted in revisions to agriculture, forestry, and fishing; mining; manufacturing; electricity, gas, water, and waste services; construction; information media and telecommunications; and rental, hiring, and real estate services.

Revisions to expenditure on GDP

  • Gross fixed capital formation revised due to updated transfer costs data and overseas trade data.
  • Central government final consumption expenditure revised due to updated income and revenue data. This caused quarterly revisions from June 2014 onwards.
  • Imports and exports revised due to updated overseas merchandise trade data and balance of payments data.
  • Household consumption expenditure was revised due to updated data for telecommunications and transport data.
  • Local government was revised due to updated data from Local Authority Statistics: September 2016 quarter.
  • The process of reconciling inventory changes with the rest of the economy  – minimising timing and valuation issues – led to inventories revisions for recent quarters.

Financial intermediation services indirectly measured

Updated input data for financial intermediation services indirectly measured (FISIM) resulted in revisions to financial and insurance services in the production measure of GDP, and also in revisions to the following in the expenditure measure of GDP:

  • household consumption expenditure
  • private non-profit consumption expenditure
  • central and local final consumption expenditure
  • exports and imports of services.

Revisions table

The following table shows the previously published and revised quarterly movements for the September 2016 quarter GDP and expenditure on GDP (GDE).

Previously published and revised June 2016 quarterly movements
Quarter GDP GDE
Percentage change from previous quarter
Previously published Revised Previously published Revised
September 2010 -0.3 -0.2 -1.4 -1.3
December 2010 -0.4 -0.6 -0.6 -1.1
March 2011 1.1 1.1 1.4 1.7
June 2011 0.7 0.6 0.9 1.0
September 2011 0.9 0.9 1.2 1.2
December 2011 0.6 0.4 1.0 0.7
March 2012 0.8 0.9 0.0 0.1
June 2012 0.3 0.3 1.0 0.7
September 2012 0.3 0.2 0.7 0.5
December 2012 1.4 1.4 0.7 1.0
March 2013 -0.1 -0.1 0.2 0.5
June 2013 0.8 1.1 -0.1 -0.2
September 2013 0.8 0.4 0.7 0.7
December 2013 0.5 0.0 0.3 0.5
March 2014 1.4 1.4 1.3 0.9
June 2014 0.9 0.7 0.5 0.6
September 2014 0.9 1.1 1.0 1.0
December 2014 0.8 1.1 1.1 1.0
March 2015 0.2 0.1 0.3 0.3
June 2015 0.4 0.1 0.6 0.8
September 2015 0.8 0.9 1.2 1.2
December 2015 0.9 1.1 0.7 0.7
March 2016 0.9 0.7 0.7 1.1
 June 2016 0.9 0.7 1.2 1.2

Source: Statistics New Zealand

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