(Bloomberg) -- The U.K. government should share the information it collects, including tax details, with the Office for National Statistics to improve the quality of economic data, according to former Bank of England Deputy Governor Charlie Bean.
In an interim report on his review into data collection and production, commissioned by Chancellor of the Exchequer George Osborne, Bean also called for a “cultural change” at the Newport, Wales-based institution so that errors are reduced, and said it should work to replace the statistical expertise lost when it relocated from London. A final report will be published by next year’s budget on March 16.
The ONS “needs to become an organization which is more intellectually curious, open and self-critical, as well as better at engaging with its customers,” Bean said. “Unlocking the data hoard already held by the public sector will not only save businesses money but also produce more timely and accurate statistics.”
Commissioned in July, the interim review made five recommendations, which included refocusing on user needs, recruiting data scientists to probe new information sources, increasing economic expertise to quality-assure statistics, using administrative data sources and becoming more agile in responding to the characteristics of the economy.
Early estimates of gross domestic product could be better informed by using Treasury data on income taxes and companies’ monthly returns, the report said. While the U.K. is usually one of the first advanced economies to report quarterly GDP, other nations, including Canada, have incorporated tax information into their statistics.
“For the ONS, it would be helpful to be able to use tax receipts as a check and balance for cash value of the economy,” said Dan Hanson, a Bloomberg Intelligence analyst and former economic adviser to the Treasury. “The government has more timely data than the statistics office at the moment.”
The institution should increase its London presence while strengthening its head office in Newport, with a view to making South Wales and South West England a “hub” of data expertise, according to the report. The location came into question in 2007 when the BOE expressed concern that the move out of London would prompt an exit of key staff and impinge on quality.
While Bean noted that close to 90 percent of the 1,000 London-based employees had left during the course of the relocation, he said the effect need not be long-lasting and that the institution should now focus on building up its presence in its new home.
“The loss of statistical expertise which resulted from the relocation decision has had a significant – though not necessarily permanent – detrimental effect,” the review said. “There is considerable potential for the current site to become the center of a ‘hot spot’ in economic statistics and data- related professions.”
--With assistance from Kevin Costelloe.
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