Monday, November 20, 2017

Non-Profit Institutions Serving Households

As well as giving a split of the non-financial corporate sector the 2016 institutional sector accounts also give a split for the household sector.  Up to now households (S.14) and non-profit institutions serving households (S.15) were combined.  We now have separate current and capital accounts for each.  Non-profit institutions serving households (NPISHs) are relatively small in the overall scheme of things (they are around two per cent of the combined sector) but we do get to see how they are funded and what, in rough terms, they spend the money on.

It should be noted that this doesn’t cover all charitable or voluntary organisations many of which are counted in the government sector given the nature of their links to the public sector.  As the CSO note:

Many charities, such as hospitals and social care providers, which receive most of their funding from government and which provide services under contract with government, are treated as part of the government sector (S.13) in national accounts, and not S.15.

Anyway here is the aggregate current account of those entities included in this sector.

NPISHs Sector Current Account 2012-2016

On the income side we can see that these institutions had around €3.3 billion of income in 2016.  Most of this came in the form of transfers with around €780 million raised from their own activities.  The CSO note:

The institutions in the NPISH sector get most of their income as transfers from households (for example donations, church collections, union dues or members' subscriptions) and also receive transfers from government.  They also earn profits on their market activities, such as charity shops and match tickets.  Relatively little of their income is from investments.

On the current expenditure side almost all goes on compensation of employees and final consumption expenditure which between them were €3.2 billion in 2016:

Their income is spent on final consumption expenditure and compensation of employees in a roughly 3:1 ratio. There are over 55,000 people in direct paid employment in the NPISH sector.

Expenditure on staff was €1.14 billion in 2016 which gives an average of €20,700 per person in direct employment.  We also get a capital account for the sector but there isn’t a whole lot going on there.

NPISHs Sector Capital Account 2012-2016

For the past few years the gross capital formation of the sector has been less than the gross saving from the current account and investment grants received shown here.  This has resulted in the sector being a net lender averaging around €45 million for the past three years.  The figures for net capital formation are positive which means that gross capital formation was lower than the consumption of fixed capital (depreciation).

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