Select Committee on European Scrutiny Thirty-Eighth Report






Draft Regulation on the establishment of a common classification

of Territorial Units for Statistics (NUTS).


Legal base:

Article 285 EC; co-decision; qualified majority voting



Office for National Statistics

Basis of consideration:

EM of 17 July 2002, SEM of 8 October 2002 and Minister's letter of 14 October 2002

Previous Committee Report:

None; but see (22188) 6419/01: HC 152-i (2001-02), paragraph 37 (18 July 2001)

To be discussed in Council:

Agreed on 9 October 2002 at COREPER; to go to the Council as an 'A' point

Committee's assessment:

Politically important

Committee's decision:





    1. NUTS (Nomenclature of Units for Territorial Statistics) is a classification of geographical areas within the EU for producing comparable regional statistics. The NUTS system uses criteria to subdivide each Member State into a series of areas to correspond with one of five NUTS levels. The highest is NUTS level 1, which broadly corresponds to standard regions in the UK. The most detailed is NUTS level 5, which corresponds to individual wards. Other NUTS levels refer to groups of local authorities and individual counties. NUTS is the basis for EU regional statistics, but also has a wider importance because it is used when determining eligibility for Structural Funds and State Aid.
    2. In 2001 the Commission presented a draft Regulation to provide a legal base for the breakdown of European statistics, to fix the current breakdown of regions for a number of years and define clear rules for future amendments. After receiving information from the then Economic Secretary to the Treasury (Miss Melanie Johnson) we cleared that draft.[58]
    3. The document

    4. Since then the draft has been considerably modified. The revisions include:

    • provision that any proposed changes to the NUTS classification would require close consultation with Member States;

    • provision that within two years of this Regulation — which would only govern NUTS levels 1 to 3 — coming into force the Commission would report on extending classification to NUTS levels 4 and 5;

    • more specific definitions to improve adherence to the statistical principles of the draft Regulation; and

    • provision that meets the previous concern about applicability to Gibraltar.

The Government's view

    1. In her Explanatory Memorandum the Financial Secretary to the Treasury (Ruth Kelly) tells us that "Most of the revisions have been made to the satisfaction of the UK, and the Government continues to support the principle of the Regulation." In her SEM the Minister says, following further developments:
    2. "The UK government is now satisfied that the draft regulation adequately addresses the concerns we had with earlier drafts."

    3. In her letter the Minister tells us that she had felt compelled to lift the scrutiny reserve on progress on this Regulation. She gives three reasons:

    • in order to quickly complete this Regulation in connection with negotiations with candidate countries;

    • as all the issues we had raised previously had been addressed satisfactorily; and

    • in order to secure the gains made.


    1. It is regrettable that the Minister felt she had to lift the scrutiny reserve on this draft Regulation. Nevertheless we are pleased to see the improvements achieved in the draft Regulation. We clear the document, but we should like an explanation from the Minister of what the Government's intention is for its use in relation to Gibraltar.


58  HC 152-i (2001-02), paragraph 37 (18 July 2001). Back

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