Select Committee on Treasury Minutes of Evidence

Examination of Witnesses (Questions 1-19)




  1. Sir John, can I make a start and welcome you again to the Committee. For the sake of the shorthandwriters, could you identify yourself and your colleague.
  (Sir John Kingman) I am Sir John Kingman, Chairman of the Statistics Commission, and on my right is Barbara Buckley, Secretary to the Commission. Gill Eastabrook, our Chief Executive, is on leave and offers her apologies.

  2. Sir John, you say in your own foreword to the your Annual Report that you "can report significant progress", but you also say "a great deal remains to be done". What is that great deal?

  (Sir John Kingman) Of course when I wrote that foreword, we still did not have the Code of Practice in place. That now fortunately is in place, though there are still protocols and departmental statements to come and we still have to work out with Len Cook how best to make that Code of Practice part of the culture of the Government's Statistical Service. We are starting now on the consultation which will lead to a report on whether we think there should be statistical legislation. That is going to be a major job. We have been working quite hard on the problems around the Census, which I am sure you will want to come to in more detail, and there are quite a lot of other issues which have cropped up in different parts of government, so we found ourselves quite busy.

  3. When you say that a great deal remains to be done, a big part of that is the implementation of the Code of Practice across the departments, is it?
  (Sir John Kingman) Yes, that is a very major part of the work.

  4. Looking back over the last, I think, maybe two years now, are you generally happy with the progress?
  (Sir John Kingman) No, it has taken far too long to get to this point. We have wasted more than a year by the delay that it has taken to get the Code agreed around Whitehall and put into effect, but we are where we are and now we must make the best of it and make sure that the Code really does lead to a change in culture that will increase public confidence.

  5. You referred twice to the changing culture and you put in your foreword as well "the need to ensure that the changes are firmly embedded in the practices and culture of government". Do you think the Government and ONS, are doing enough to ensure that that is the case?
  (Sir John Kingman) ONS are certainly trying very hard and of course you have to distinguish ONS as an office from the National Statistician with his wider remit for the whole of government statistics. I am sure that when you talk to Len Cook he will tell you, and it will be true, that he is trying to ensure that the same high professional standards operate in the departments that do their own statistical work as he is imposing in the Office for National Statistics.

  6. And the government commitment?
  (Sir John Kingman) Well, of course the fact that it has taken so long to get the Code of Practice must be a sign that not all ministers are totally convinced. We do not know what discussions took place within Whitehall, but I think it is not unnatural that members of the Government and their advisers are sometimes a bit chary of insistence that they meet higher standards in using and issuing statistics.

  7. Those are diplomatic words! Perhaps we can move on to one specific issue which is the treatment of Network Rail. You issued a press release, I think, saying that in your judgment, as a commissioner, the ONS applied the international conventions on national accounts properly with regard to Network Rail. The Comptroller and Auditor General then took a different view. Do you think it was right to follow international conventions in this particular case? Why was that?
  (Sir John Kingman) It clearly is the job of ONS to interpret and apply the international conventions. There is no point in having international conventions if they are not used, but they do not tell the whole story. What we have been trying to tease out is the whole picture so that politicians and the public generally can see the true reality of what has been set up in Network Rail. We looked very carefully at the way the relevant people in ONS applied the international conventions and we came to the conclusion that they had done an honest and rigorous job with the information that they had available to them. They made it clear that if further information became available, they would want to look at the issue again, and it is clearly right that they should do that. They also relied heavily on an assurance from the most senior accountant in the Department of Transport that the government guarantees were unlikely to be called upon. Now, we have tried to discover what lies behind that advice. We are assured that it was given by a politically-impartial accountant. I have no way of testing that assurance, but certainly the Comptroller and Auditor General, applying different criteria, has come to a different conclusion and we in the Commission think that there needs to be a full reconciliation of his view with the view of the people in ONS. We were promised some time ago a joint statement by the National Statistician and the Auditor General. That has not appeared. I wrote to both of them on 1 October, saying that their failure to produce such a statement made it difficult for the public to have confidence in what is going on and I have not had any replies from either of these busy gentlemen, but I hope that will be coming soon. Clearly there are different criteria and we have met a number of instances in our work where this is the case. What we are saying is it may be valid to have different criteria, but you need to explain what is going on. The whole picture needs to be put in terms that can be understood.

  8. You have referred to the need for the public to be able to see what is going on and I think you have conceded that it must be confusing for the public if the idea is around that both parties, you and the Comptroller and Auditor General, can be right because clearly both parties cannot be right, can they?
  (Sir John Kingman) Well, both parties are applying the criteria which it is their job to apply and are coming to different conclusions. They have to explain, I do not think it is for us to explain, but they have to explain what it is that is different about the different criteria and why one set of criteria is useful from one point of view and another set from another point of view. It is something which is not uncommon in commercial life. A company which has activities in the UK and the US has to produce accounts very often in two different formats for the two different systems and it is required that they should show a reconciliation of those. I think we are talking about the same thing. When two different criteria are applied, it is confusing and the obligation is on those who make the determination to explain the difference between the criteria and the underlying reasons for the different judgments.

  9. Is there not also an obligation on you as the supervisory body, the body with oversight? If anybody can end the confusion, surely it is the task of the Commission to do that? What are you going to do to get this promise of a joint statement? What is your next step?
  (Sir John Kingman) I do not think it is for us to tell the Auditor General what he thinks. We have got to tease out what he thinks, preferably in the form of an agreed statement, but if they cannot agree, they will have to do their best to explain to us and we will then try and explain to the public just what is going on. I regard this very much as unfinished business. Although the press like to say that we have decided that Network Rail is a private company, we have not at all. What we have said is that the narrow, limited operation of the European System of Accounts has been properly carried out and, as far as we can see, without political influence or partiality, but that is a very narrow conclusion and we want to see a proper public explanation of the realities of the situation, including the point that I have made, just why it is that it is believed in the Department of Transport that the guarantees will not be called upon. I think that needs to be explained and it has not yet been explained.

  10. You might argue that either they are required or they are not required.
  (Sir John Kingman) They are clearly regarded as necessary, but that does not mean they will be called upon. They are presumably some sort of belt and braces, but that is something that has never been properly explained and it must be properly explained.

  11. And you are still on the case?
  (Sir John Kingman) We are still on the case.

Mr Laws

  12. Sir John, can I follow up some of the comments that the Chairman has made, particularly about your relationship with the ONS. There does seem to be quite an exchange of comments between the two groups recently and you are aware of the article in the FT on 18 July in which Mr Cook refers to some of the criticism of the Statistics Commission in terms of your comments being "interfering, flippant and glib". In relation to the issue of the classification of debts of Network Rail, Mr Cook of the ONS says, "I am the person who decides on all professional matters in the United Kingdom's National Statistics, not the Statistics Commission. . . Their decision does not matter, it will not influence anything and they are not actually competent to make it". What are your comments on that?
  (Sir John Kingman) Well, he is clearly right to say that it is his job to make these determinations. It is our job to assure the public, if we can, that he is doing his job in an impartial and professional way. I think he got slightly carried away with his enthusiasm in that particular case, but obviously from time to time we will disagree. We, as the Commission, need to distinguish between saying that someone like the National Statistician has perhaps made a mistake or saying, on the other hand, that the National Statistician is allowing political pressure to influence his professional judgment, and that second one would be a very serious accusation and it is one that we are not making. We have no evidence that Mr Cook's decisions are influenced by political pressure, but we do not always agree with his decisions and that is an honest disagreement.

  13. You are quoted in that article as saying that the recent controversies "raised some very important general points—about independence and about quality of national statistics". Do you have any concerns about the independence and the quality of the ONS?
  (Sir John Kingman) We are concerned that that independence should be entrenched. It exists de facto at the moment, but not de jure and that is one of the issues that we shall come to when we are looking at legislation because it is one thing to say that the present National Statistician is doing a highly professional job and is independent, but it is another thing to say that we can offer any guarantee that that will continue to be the case. In the absence of legislation, I do not think we can offer such a guarantee.

  14. Do you have 100 per cent confidence that Mr Cook and the ONS have so far managed to resist political pressure in relation to these matters?
  (Sir John Kingman) Well, 100 per cent is a big number, but we have no reason to suppose that there is any political influence on their decisions.

  15. But you do not have 100 per cent confidence?
  (Sir John Kingman) I do not think anyone can have 100 per cent confidence in anything.

  16. Well, 50, 60, 10?
  (Sir John Kingman) I am not going to start inventing numbers.

  17. You will understand that obviously the Committee is concerned about the integrity of national statistics, as are you obviously.
  (Sir John Kingman) Yes.

  18. I am trying to get some feeling for the extent of your concern that a lot of pressure has been put on the ONS perhaps to see things in the way government ministers would understandably want them to see them.
  (Sir John Kingman) I do not think that is happening and I think that if ministers or others were to try to do it, it would be counterproductive. As you see from the reports, Mr Cook's vocabulary is quite extensive and I think he might well use it if people tried to influence his professional judgment.

  19. The issue of the independence of the national statistics obviously came up again recently in relation to ministerial access to information, and we are going to go on to discuss that. In the context of that, you were quoted as saying that the impartiality of the ONS remained in doubt because the Chancellor had refused to surrender the power, scope and definition, for example, of the inflation data. Do you have any doubts? You said you have not got 100 per cent confidence in the ability of the ONS to resist political pressure, but do you have 100 per cent confidence in the commitment of the Government, including the Chancellor, to a process in relation to national statistics in which politicians are not able to interfere or, how shall I say, lean upon those involved in the production of those statistics?
  (Sir John Kingman) I think ministers are inevitably pulled two ways and I am not pointing the finger at any particular minister. On the one hand, I believe that all our ministers understand the need for good, impartial, high-quality statistics.

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