Select Committee on Treasury Minutes of Evidence


Examination of Witnesses (Questions 20-39)

MR LEN COOK, MR JOHN PULLINGER AND MR ROBIN LYNCH

WEDNESDAY 30 OCTOBER 2002

  20. That would be perverse.
  (Mr Cook) When it comes to people arriving in the United Kingdom we allocate them according to what they tell us on their international passenger card. When it comes to leaving we use the information that we get from people who are leaving to tell us where they have come from.

  21. Yes, but if you are losing an additional 100,000 people per year that must have a knock-on consequence for wherever in Britain it was that those people were living.
  (Mr Cook) Yes.

  22. How do you attribute that?
  (Mr Cook) We attribute the flows from in and out to the international passenger survey. We then can work out how people are moving within the United Kingdom through changes in addresses and National health Service registrations.

  23. I am not really getting to what I want. Let me put the question a different way. You began by saying that the million people we appear to have lost were never there in the first place.
  (Mr Cook) Yes.

  24. This question therefore sounds a bit odd but you will understand why. Where in Britain were the million people we did not have living?
  (Mr Cook) We can give you an analysis of each of the 376 local authorities and tell you what was their population estimate as at June 2001 and we can tell you what was the census base estimate for that period. We can give you an analysis of each of the local authorities if you wish. I can send that to you.

Kali Mountford

  25. I am getting more and more confused here. One the one hand you seem to be suggesting they did not exist in the first place, and then you went on to say that there were problems with measuring people leaving, and you went on to talk about European countries. It seemed to me from your answer that you could have been suggesting that there was an inter-European balance going on with some people coming here and some of our people going there, but because we were measuring people coming here from wherever in Europe we knew about them but we do not know about ours leaving, and that would be more significant because they are much more likely to go through ordinary channels in Customs and not be recognised by your survey. Is that what you are telling us and, if that is what you are telling us, can both situations be right?
  (Mr Cook) No. What I was saying was that when it comes to measuring people coming into the country we get an estimate from the international passenger survey. There is other information that we can get from our labour force survey, from registrations into administrative services such as the NHS, that gives us confirmatory information of those flows. The only confirmation we have of the flows of people going out comes from looking at other countries' migration statistics. One of the few that we have that can give us good information, for example, is Australia where we discovered that we had 50,000 more people from the United Kingdom go to Australia than we had assumed in our own analysis from the international passenger survey.

  26. But that suggests that the million did exist at some point. If it is true that people have gone and we have lost them and we did not know that they had left, then they must have existed at some point or the 1991 census was wrong and we over-estimated. There must be some balance between the two and if you are suggesting that we have this problem particularly in the European nation states what is your suggestion that we can use within the whole of Europe to get this balance right, because if it is affecting us it is affecting them?
  (Mr Cook) Can I answer your last question first? We have not completed the work that we are doing. We have got a small team of people looking at the whole range of options that we have. If we were to look to a solution similar to that used for foreign trade then it would require work within Europe to get some agreement on how we proceeded. A good many of the European countries have the same problem as we do and therefore getting an agreement is not starting from a completely fresh position because the issue has been discussed quite a few times in the European statistical forums.

  27. I hope you are going to tell me what progress you are making.
  (Mr Cook) We have really only made significant progress in the last four months in that our time beforehand has been much more about investigating options. We have now got some very able people working on the problem full time and we expect to have a report in the new year.

  28. Which new year are you talking about?
  (Mr Cook) Perhaps I can get John Pullinger to be more precise.
  (Mr Pullinger) The census gives a new benchmark of who is here so it is because we found in the census that growth in the population was a million lower than we had thought that we now need to do this investigation. We knew there was a problem with migration statistics anyway for the reasons that Mr Cook has identified, and we had already commissioned a national statistics quality review of the sources of information we could use to monitor migration and how we might improve them. It is that which we will report on in the new year and that will give us a much better fix, we believe, on how we can capture these flows both into the country and out of the country. The key problem that we have identified with the census is that we are confident that there is a bias in our current method for estimating the people who are leaving here. Those people were never here in the sense that the population was never a million higher, so it was never 59.9 million. What we are saying now is that growth in the population was 0.1 per cent lower each year over the last ten or 15 years.

Chairman

  29. You are not going to count people who were never here?
  (Mr Pullinger) We are not going to count people who were never here.

Mr Beard

  30. How do you know that this is the source of the problem though, the immigration/emigration? How do you know that it is not just that you under-counted by two million or that two million escaped the census instead of one million?
  (Mr Cook) When we look at the certainty that we can have of the various sources of information that we have got, births, deaths and the census, and the effectiveness of the census coverage survey—we have in the United Kingdom a very large census coverage survey which gives us the ability to measure for each of the 376 local authorities separately and independently of the census, an estimate within five per cent of what the population was—we can be quite sure that the majority of the problem lies within the migration statistics that we have got.

Dr Palmer

  31. Jim Cousins asked you about how the additional migration which you reckon to have discovered is attributed to the local authorities basically. You very kindly said you could provide detailed figures. As you probably are aware, there is considerable debate in Parliament at the moment about the standard spending assessments according to, among other things, local population and I know my borough council is in dispute with the authorities on how many people live there. How confident are you that the attribution of the migration statistics to this correction has been taken account of in the SSA debate? Are you aware whether it has or not?
  (Mr Pullinger) Obviously the precise calculation of the standard spending assessment is a matter for the Deputy Prime Minister's office but as far as the statistics are concerned the numbers that we are now putting forward are the census numbers which provide the new benchmark of the numbers of people who were here. They do not rely on correctness or incorrectness of migration attributions.

  32. That is the statistics you are now putting forward but the current debate is based on the figures from last year and those will not have the correction yet, will they?
  (Mr Pullinger) The current debate is about the difference between the figures that were produced, which are the mid-year estimates for the year 2000, and what we are now finding from the census. Inevitably in some local authorities the numbers are lower, in some they are higher.

  33. The current SSA debate, you are saying, or the current debate on the census? I am sorry; we may be talking of two different things.
  (Mr Pullinger) The calculation of standard spending assessments for next year is being informed by the census information which has now been released. That was one of the things that was driving our timetable for the release of the census information so that it would be available in time for this debate.

  34. How do you feel ideally that the definition of the retail price index should be set? Who should set it? What would command most public confidence?
  (Mr Cook) In most countries it is set by the National Statistician, often informed by a committee, in some cases set up by the minister. In the case of the small country where I used to be it was the responsibility of the Government Statistician but the Government Statistician was advised by a committee set up and appointed by the Minister for Statistics and the advice that that committee gave was presented to Parliament and therefore the Government Statistician had a very clear accountability of explaining if he were not responding according to that committee's preferences.

  35. How does that differ from what we do here?
  (Mr Cook) In practice it has not differed at all to the extent that in 1993-1994 there was a committee chaired by the then Director of the Central Statistical Office, Bill McLennan. That committee was appointed by the Chancellor and it contained about 20 people; I have forgotten the exact number but it contained a large number of people. It presented two alternative views as to what the RPI in the United Kingdom should look like. The Director of the Central Statistical Office provided a way ahead for that and that was accepted by the Chancellor.

  36. In commenting on the code of practice the Statistics Commission called for the special arrangements for the Chancellor's involvement in the RPI to be spelt out and for a public register to be maintained of those occasions on which ministers are consulted about proposals which impinge on government policy. Have you been asked to comment on these proposals?
  (Mr Cook) No.

  37. May I invite you to comment now?
  (Mr Cook) I would expect, if I were given a direction on the RPI, that it would be naturally a matter in the public domain. Certainly it would be very unlikely that the National Statistician would be expected to act on a direction that was not in the public domain. It would certainly give me incredible difficulty if that were the case.

  38. So what you are telling us—I do not want to put words in your mouth—is that there have been no secret communications from the Chancellor or Treasury of their views on the RPI?
  (Mr Cook) There have been no secret discussions on the RPI of the United Kingdom that involved me or my Office. Certainly during the time I have been here there have been odd discussions, whether it is with the Bank of England or Treasury economists, and there is the odd exchange of views, but it is certainly no different than I would have experienced in my previous post or would happen in any other country.

  39. Do you feel that the current definition of the RPI is reasonable up to date or is it time for a review?
  (Mr Cook) I think the Bank of England Act has altered the nature of the way in which we would treat individual major statistics. For example, in the national accounts there is an expectation that quarterly GDP should be able to be measured with greater reliability than we might have expected before that because of the very significance of the decisions, the indexation almost of interest rates to GDP and RPI changes. I think there is a greater likelihood that a future RPI would be focused much more on the measurement of inflation rather than the mix with an outlays approach to inflation measurement as it exists in the United Kingdom. That is a trend which is happening in pretty much every other country in the world. If we were not to follow that trend (which we might not) we would obviously have some good reason for not doing so.


 
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