Official statistics 'do not reflect the sector's contribution to GDP'

Findings from the UN Non-Profit Handbook

The British voluntary sector could be contributing three times as much to GDP as official figures suggest, according to a UN-backed project to create consistent accounts for the not-for-profit sectors in countries around the world.

The UN Non-Profit Handbook Project, coordinated by Johns Hopkins University in the US and the UN's statistics divisions, aims to create a set of 'non-profit satellite accounts' in every country to measure the GDP contribution of not-for-profit sectors.

The UN system has so far been adopted by 32 countries, including the US, France, Germany and Italy, but the UK's Office of National Statistics is not currently participating in the project.

"Traditional measurements of GDP do take into account the not-for-profit sector," said Megan Haddock, project coordinator at JHU's Centre for Civil Society Studies. "But the measurements are completely out of date.

"They assume, for example, that most not-for-profit income is from donations, whereas most charity income in the UK is earned."

Haddock said work done by JHU to measure the size of the UK charity sector suggested it would triple in size under the system of measurement proposed by the handbook project.

She said the existing GDP measure did not include volunteering, which was thought to make up 40 per cent of the value of third sector employment, and many charitable activities were recorded as parts of other sectors, such as health or financial services.

Karl Wilding, head of research at umbrella body the NCVO, said that it was not feasible for the ONS to adopt the UN measures.

"The ONS probably realises that the way it reports statistics doesn't reflect what the third sector contributes," he said. "But it doesn't have the resources to adopt this way of working."

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