Mike Keoghan
Deputy National Statistician and Director General for Economic Statistics
Office for National Statistics
(by email)
29 November 2023
Dear Mike
Revisions of estimates of UK Gross Domestic Product (GDP)
Following our letter in September 2023, announcing our review of your practices around the preparation and release of information about revisions to estimates of GDP, we have today published a report setting out our findings.
Timely estimates of GDP and its growth are vital indicators for users, including HM Treasury, the Bank of England and the Office for Budget Responsibility, to analyse and forecast the economic performance of the country.
Our report found that ONS's approach to revisions is appropriate and well managed and our overall conclusion is that the more extreme criticisms that ONS received are misplaced.
Building on some good features of ONS's approach to revisions, we have set a number of requirements for improvement which will help ONS promote a better understanding of the uncertainty surrounding GDP estimates.
Implementing these requirements will ensure enhanced public and media understanding of the uncertainty that surrounds GDP estimates. We expect your team to make quick progress to fulfil requirements 1 to 4 by June 2024 and to publish an action plan by January 2024, setting out how you intend to meet requirements 5 to 8, and to report back to us every six months on progress on implementing these actions.
We would like to thank the teams involved for their positive engagement in working with us during the tight timescales between the Quarterly National Accounts and Annual Blue Book 2023 releases. And please do not hesitate to get in touch if you would like to discuss any aspects of this letter and accompanying report.
I am copying this letter to Darren Morgan, Director of Economic Statistics Production & Analysis, Craig McLaren, Deputy Director for National Accounts Coordination Division and Rachel Skentelbery, Deputy Head of Profession for Statistics at ONS.
Yours sincerely
Ed Humpherson
Director General for Regulation
Ed Humpherson
Director General for Regulation
Office for Statistics Regulation
29 November 2023
Dear Ed
Thank you for your letter.
We welcome your finding that our approach to revisions is appropriate and well managed and agree with your conclusion that the more extreme criticisms that ONS received were misplaced.
As you note, there are already a number of good features of ONS's approach to revisions. We are always clear that our headline figures are estimates, but we will redouble our efforts to communicate additional uncertainty in our data, where they exist. Further improvements in this regard will be made to the upcoming quarterly GDP releases over the next six months.
We also welcome your findings on both estimating changes in the costs facing businesses and also improving the quality of the income and expenditure measures of GDP – including household income and spending – within early estimates of GDP. ONS has already started work looking into these areas and will set out plans more fully during January 2024.
Yours sincerely
Mike Keoghan
Deputy National Statistician and Director General for Economic Statistics
Office for National Statistics