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The movement from the international passenger survey with the labour force survey will not, regrettably, make things better. It is suggested that the labour force survey got nearer to the estimate than the IPS in 2001, but if we go back to 1991, it was the other way round. So there is no guarantee that it is better. In fact, the labour force survey sample is even smaller than the sample used for the IPS. That is crucial, especially as we are to move to three-year local government finance settlements, starting in 2008. It is therefore all the more important that we
get this right to start with, because the problem will be much more difficult to unpick if we are locked into a three-year settlement on the basis of inaccurate and unreliable figures.
The fault here is that the two methods fail to pick up short-term migrants, to whom I have already referred, or people who live in London for part of the week but are counted as resident elsewhere. Many people live in London for part of the week for their work, not a few of whom are connected to this honourable House, but their family home is regarded as elsewhere, so that is where they live for the purposes of the official population statistics. However, while they are here they use London refuse services, leisure services, street cleansing services, and so on. That is not recognised.
The figures do not take into account either the very real and well documented effect of population churn in large cities such as London. In the City of Westminster and some other central London boroughs, population churn of about a thirdup to 34 per cent.is well documented. That in turn creates particular costs, because it involves one set of short-term migrants being replaced by another. They are not picked up by the official statistics, but they are nevertheless using local services. The ONS has said that it will publish estimates of short-term migration later in the year, but that will be too late for the start of the three-year financial settlement in April 2008. Much more urgent action is needed, which is why I have raised the issue in the debate tonight.
I have set out in some detail what is wrong. London Councils does not want the Government to wash their hands like Pontius Pilate and say that it is all down to the quangothe ONS. The Government have responsibility. What we need to do is accept that current estimates are not working and are not fit for purpose, and accept that there is a lack of clarity and transparency. It is reasonable to ensure that we develop a methodology that is robust, up to date and fit for purpose. There must be proper consultation with local authorities before it is changedthat has not happened so farand minimum standards of accuracy should be set out on a basis that can be agreed between the Treasury, the ONS and local authorities. Perhaps the incoming chair of the Statistics Board could, with a little push from Ministers, take that into account.
If only the Government and the ONS would listen to councils in London, accept what is happening and come up with a solution to restore both fairness and public confidence. That is the reason for this debate at this late hourlate in terms of the time and of the opportunity. We must get things right before the funding settlement cuts in. We contend that the Government cannot abdicate their responsibility on this issue. Ultimately, ONS has to be accountable. So far, regrettably, it has put its head in the sand in the face of compelling evidence. What is needed is for the House and the Government to put pressure on it to accept reality and change things in available ways while there is still time to do so.
The Exchequer Secretary to the Treasury (Angela Eagle):
First, I congratulate the hon. Member for Bromley and Chislehurst (Robert Neill) on securing this evenings debate. I thank him for raising the important issue of
the compilation of statistics on Londons population. The hon. Gentleman explained that this is such an important issue because ONS population statistics are used to determine local government funding. Equally, they are used to inform local planning in respect of services for the future.
It is precisely because of the importance of these statistics that ONS takes a great deal of care in making them as accurate as possible. ONS is currently involved in ongoing work to improve statistics. I will come on shortly to describe how those statistics are put together, and explain why some of the suggestions about flaws in the methodology are inaccurate.
I would like to start, though, by talking briefly about how these statistics are used, because the impression is sometimes created that local government funding depends entirely upon population statistics. I will not describe in detail the funding formula used for local governmentwe are all familiar with it, especially with how it impacts on our own areasnot least because it is the responsibility of the Department for Communities and Local Government rather than the Treasury. However, I will say that it takes account of other factors, such as local authorities ability to raise revenue from council tax, alongside the population statistics, which are clearly important in themselves.
There is also a process known as damping, which is used to ensure that all local authorities receive a minimum increase in grant, known as the floor. That floor means that even if population statistics were to show the population decreasing in an area, the local authoritys funding would still increase by a reasonable amount.
Nevertheless, population statistics are clearly important, and they should be as accurate as possible. As well as being used for local government funding, they are used to develop and monitor economic and fiscal policy and to understand social change, as well as any policy implications that stem from it. These statistics are calculated as accurately as possible, using a clear and carefully designed methodology.
One of the challenges for that methodologyit is only part of the taskis to factor in the impact of international migration on population levels. The hon. Gentleman has raised that matter in the House this evening. Migration is largely calculated on the basis of the international passenger survey. We have heard a number of things about the lack of accuracy in the IPS, but I should like to draw attention to areas where it is reasonably robust.
First, it has been claimed that IPS is restricted to the major airports and that it does not include Victoria coach station, for example, where 20,000 people can arrive. Actually, it sampled 16 airports, 11 seaports and the channel tunnel. Clearly, it does not sample Victoria coach station, but that is simply because coaches from other countries cannot get there without passing through a port or the channel tunnel. The IPS picks up the inhabitants of the coach on its way through to Victoria coach station.
Secondly, it is not the case that the international passenger surveys sampling is carried out only during the working day, as critics have said. There is flexibility in when the sampling can take place, especially to include particular flights from particular countries that may arrive early at an airport.
Robert Neill: Will the Minister accept, however, that she is missing an important point? It is important to have accuracy of statistics not just on who is coming into the country through the entry points, but in terms of calculating, for example, local need and grants when people are here. The IPS does nothing to assist in that, for the reasons that I set out.
Angela Eagle: The hon. Gentleman is right, and that is why the labour force survey offers extra insight, although I would be the first to say that it is not an actual count of all migrants wherever they are. Even if we could do that and afford to do it regularly, it would still provide only a snapshot of the situation, which, as he said, can be fluid.
The IPS is more comprehensive than is often suggested, but the ONS is committed to ensuring that population statistics are as accurate as possible. It has been working this year on improving its methodology. Plans to do that were published in April. The ONS has held meetings with a number of users, including some London local authorities, to discuss planned changes. Those meetings have led to refinements to the proposals, which were outlined in material published yesterday. There have been workshops and feedback has been given. I expect the dialogue to continue as changes to the methodology to produce more accurate figures are put into effect.
The improvements that the ONS is making to its methodology make the information more accurate and improve quality. In particular, migration estimates will now draw on the labour force survey in addition to the IPS, which will help to reflect what migrants do after they have entered the country and where they settle. There is some evidence that the IPS may be particularly inaccurate for well-known places such as Westminster, Oxford or Manchester because people often fill in a place that they have heard of when asked about their destination, and that is not always where they end up living.
Again, concerns have been raised about aspects of the labour force survey, including the suggestion that it does not take account of people in multi-occupied dwellings. Although it does not take account of people in communal establishments, such as halls of residence, it does cover all types of private households, including those that are in multi-occupied dwellings. While response rates to the survey for multi-occupied dwellings are lower than those for single household dwellings, the weighting of the sample to take account of age, gender and region goes some way to correcting that. There have been improvements and a process of ongoing dialogue with local authorities, including London local authorities. I expect there to be an ongoing liaison.
The improvements in the methodology improve in particular the regional and local distribution of international migrants in the statistics that the ONS produces. Combined sources of such statistics have strengths that increase the robustness and the likely accuracy of the results, rather than taking the results from a single survey. The improved methodology will now be applied to revise population statistics for 2002 to 2005 and to produce 2006 mid-year population estimates, all of which will be released in August.
The improvements will not change the trends demonstrated by the existing methodologys estimates. In particular, figures based on the improved methodology will not show either population or migration levels decreasing. Across England and Wales, the original method showed an increase in population due to long-term international migration. The improved methodology increases that slightly, by 28,000. For London, the existing method implied an increase of 396,000 between 2002 and 2005 as a result of long-term international migration. The revised method reduces that increase to 336,000, but that is not the same as saying that migration is decreasing, and it is certainly not saying that the population is decreasing. Instead, the revised figures show that migration to London remains on an upward trend, but at a lower level than the estimates suggested.
I should re-emphasise that the changes are being made to improve the methodology and accuracy. As well as making the statistics more accurate this year, the ONS has planned further improvements for subsequent years. In particular, an interdepartmental taskforce on international migration statistics was set up in 2006 and has made a number of strategic recommendations for further improvements in the years to 2012. The ONS is already taking forward some of those recommendations, and will publish a full response later in the summer.
The ONS also published a revisions policy earlier this month, setting out the principles for further revisions to population statistics, and it has been working with local authorities and Government Departments to identify how new and existing information sourcessuch as GP and school registrationscan be used to inform migration estimates and address local issues in population estimation. That goes to the heart of what Members have been talking about.
However, that is not as easy as it might seem. The statistics published yesterday on national insurance numbers issued to overseas nationals caught the medias attention and have been mentioned in our debate, but basing population estimates on national insurance numbers could be misleading, as some people apply for them but do not use them, while others need them only for a short period. In other words, national insurance numbers provide an inflow figure, which is not necessarily a net figure, and many of those who applied for national insurance numbers might have already left the country. National insurance numbers do not show the flow out; they only show the flow in.
That brings me on to my final point, on those who come to the UK only for a short period. The ONS population statistics that I have talked about rely upon the UN definition of a long-term migrantsomeone changing their country of usual residence for at least a year. We believe that that is the most appropriate and reasonable definition to use and the most realistic way of accurately determining the population levels in different areas. We recognise that short-term migration is also important, as is churn, but such trends are difficult to pick up on accurately and in a timely fashion without spending ones whole life getting snapshots of an ever-changing situation. That is why I am particularly interested in discovering how we can use other indicators and statistics to get a closer handle at a more disaggregated level on what is happening.
We believe that the annual definition is the most appropriate one to use, but the ONS has been working hard on producing innovative estimates, and will publish national figures later in the year. However, this is a new and difficult area and we cannot expect accuracy immediately as we feel our way towards a solution.
There are several such indicators. The hon. Gentleman mentioned GP registrations. There are also school registrations, but that does not address the short-term or long-term issue. Each attempt to measure accurately at a disaggregated level must be looked at carefully for what it actually tells us. The national insurance numbers demonstrate only flows in; they do not give us a picture of the net situation, nor
do they tell us about flows out. They can be more misleading than useful, even though they have been prayed in aid tonight as indicators.
Each attempt to take a look at what is happening in local communities must be analysed to establish its accuracy and its shortcomings as well as the information it provides. The plea I make is that that is what we all have to do as we try to feel our way to a more accurate method of measuring at community level precisely what is going on in a dynamic and open economy.
This has been an important debate, and I am grateful to the hon. Member for Bromley and Chislehurst for raising it. I look forward to there being ongoing dialogue as the ONS attempts to improve its methodology so that we can have more accurate and better policy.
That the draft Asylum (Designated States) Order 2007, which was laid before this House on 22nd May, be approved.
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