Tuesday, 22nd May 2007
Tim Buckley Owen
‘Safe as the Bank of England’ the old saying goes. So when the Bank of England tells MPs that it’s worried about the impending move of the Office of National Statistics (ONS) from London to Newport in South Wales, we should sit up and take notice.
As information professionals, we couldn’t manage without official statistics – constantly locating figures on inflation or earnings or economic growth and relaying them to our bosses to inform their own projections of costs or wages or profits. Now, in a memorandum to the Commons Treasury Committee, the Bank has told MPs that ‘the relocation programme poses serious risks to the maintenance of the quality of macroeconomic data’.
Only about 15% of the London-based staff are expected to move to Wales, according to the ONS’s head Karen Dunnell, and the Bank is worried that she might have difficulty recruiting sufficiently skilled statisticians locally. This is no rarified theoretical concern; as history has shown, poor statistical data can lead to serious economic problems.
In June 1998, the Bank of England Monetary Policy Committee decided to raise interest rates yet again, because of ONS figures that showed earnings rising alarmingly in the service sector. It subsequently turned out that the figures were substantially wrong and a great deal too high, and that consequently the interest rate rise may not have been necessary.
And those with memories going back to 1992 may recall Black Wednesday, when the pound was forced out of the Exchange Rate Mechanism, a system for tying its value to that of other European currencies. It might never have happened if official figures had been correct; as it was, statisticians had been understating Britain’s economic growth by some 2% over the two years leading up to that fateful day.
The media – including the BBC, Telegraph and Times – have started picking up on these concerns, which have implications across the whole of business and the economy. We should be able to see the details of the Bank’s submission on the Treasury Committee web site soon as well.
Worth keeping an eye on, if you’re concerned about the quality of the data you’re supplying.
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