Why we need an independent statistics office

By Editorial staff Simon Wilson Dec 06, 2005

As Benjamin Disraeli noted well over a hundred years ago, there are three kinds of lies: lies, damn lies, and statistics.

But rarely in British politics has the Tory prime minister’s pithy observation seemed so apposite as it does today, said Jeremy Warner in The Independent. In the present climate of spin and counterspin, officially compiled Government statistics are “routinely abused for political gain”.

This is important – as well as shameful – because if policy is based on rigged statistics, then it, too, is likely to be flawed. And it’s the Government, especially the Treasury, that must shoulder the blame for the lack of trust in official figures. Ministers are all too eager to cite misleading statistics that reflect them in a good light and attack those that don’t as flawed and biased. So they tend to put pressure on the Office for National Statistics (ONS) to change the way they come with the figures “until eventually they come up with the answer the Government wants”.

The most glaring example of this kind of sharp practice was the row over how to classify Network Rail – a row that gravely damaged the reputation of the ONS, said Simon Briscoe in the FT. The Treasury, in effect, wanted to renationalise the rail network, but at the same time make the national accounts look better by pretending it was still a private company. Ministers gradually wore down the ONS, a supposedly autonomous department of the Treasury, by bombarding it with repeated requests to reclassify Network Rail as private.

Similarly, National Health Service waiting-list figures have been subject to manipulation. These, and other similar controversies, have gradually eroded public trust in official statistics, damaging the credibility of the political process as a whole.

So this week’s announcement that Gordon Brown is to make the ONS independent of the Treasury is excellent news, said an FT editorial – though much will depend on the detail of the legislation due in January. Encouragingly, the chancellor plans a similar model to the Bank of England, whose independence has “had such beneficial consequences for monetary policy”: an independent board with a ‘governor for national statistics’, and accountability to parliament.

The Chancellor’s aim, said Philip Webster in The Times, is to give the Government’s claims on public-sector improvements more weight with voters ahead of the next election.

It is clever politics from a man who expects to be PM within two years, said the Daily Mail. Labour is poaching an idea first espoused by the Tories in the run-up to the last election, and which shadow chancellor George Osborne called for again just last week. Brown has thus deftly deprived the new Tory leadership of one of its “fresher ideas” just as the new leader takes charge.

But he should go further, and “curb the controversy” over Treasury goalpost-shifting on fiscal rules by allowing an independent ONS to define the timing of the economic cycle and the components of budget financing. Will it happen? “Don’t hold your breath.”

Published in Economics | More articles by Simon Wilson

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