[Relevant documents: Tenth Report from the Treasury Committee, Independence for Statistics, Session 2005-06, HC 1111; and the Government’s response thereto, Seventh Special Report from the Committee, Session 2005-06, HC 1604; and Independence for Statistics: the Government response to public consultation, November 2006.]
Order for Second Reading read.
I beg to move, That the Bill be now read a Second time.
I am pleased to open the debate on Second Reading of the Statistics and Registration Service Bill, which, for the first time in Britain, legislates for the independence of statistics. I am encouraged by the broad welcome for the measure and the amount of interest in our plans from both major Opposition parties and the Treasury Committee.
The House has a central role in and responsibility for the new statistics system, not only in scrutinising—and, I hope, passing—the necessary legislation but in holding the new statistics board and the operation of the new system to account. In future, the new independent statistics board will have statutory responsibility for ensuring the quality, good practice and comprehensiveness of all official statistics. Unlike the Office for National Statistics at present, the board will be outside Ministers’ control and accountable directly to Parliament. I therefore hope that, alongside debate on the Bill, hon. Members will consider how Parliament can best discharge its new scrutiny functions for the independent statistics system.
It is 60 years since the last major statistical measure, which was the Statistics of Trade Act 1947. It is therefore a historic day in the development of the UK’s statistics system. The Bill sets out plans for many of the proposals that professional statistical interests have pressed on us. They include: the demand that we introduce new legislation to safeguard and reinforce trust in statistics; the demand that we introduce a statutory code of practice; the suggestion that we introduce new arrangements for greater sharing of administrative data; the request for tighter arrangements for pre-release access to Ministers and officials, and the suggestion that we develop the system so that it can be UK-wide rather than applying simply to England.
I commend the Government for introducing the Bill, which, as my hon. Friend the Financial Secretary said, has been 60 years in the making. I also commend the work of the Treasury Sub-Committee under the chairmanship of the hon. Member for Sevenoaks (Mr. Fallon). I know that the Government have taken great heed of the Treasury Committee’s recommendations on statistics.
However, does my hon. Friend agree that the kernel of the matter is public trust and that perception of political interference must therefore be swept away? Will he give due consideration to the statistics from the Office for National Statistics and from the Department so that we not only have but are seen to have an independent Statistics Commission?
I said a moment ago that I welcomed and was glad of the Treasury Committee’s active interest. I pay tribute to the work of the Sub-Committee, which the hon. Member for Sevenoaks (Mr. Fallon) chairs and the long-standing interest that the Committee has shown in the credibility and integrity of official statistics. Several hon. Members, including my right hon. Friend the Leader of the House, whom I am glad to see in his place, have pursued and followed the subject for a long time.
I assure my right hon. Friend the Member for West Dunbartonshire (John McFall), who chairs the Treasury Committee, that we have taken the Committee’s report seriously. We have responded to several of the major recommendations, which I shall outline this afternoon. He is right that we need to reinforce not only the quality but the integrity of and trust in official statistics.
My hon. Friend the Financial Secretary is well aware of the importance of nationally collected statistics to the provision of local services. Many in local government give a broad and warm welcome to the measure, but they express some concerns about whether the Bill as drafted will facilitate effective co-operation between responsible public bodies working for the public good. Will my hon. Friend say a word or two about that? Of course it is important to maintain the protection of sensitive data, but he spoke about sharing administrative data. Will he clarify what he means by that, and specify the exclusions?
I shall come on to the Bill’s proposals for data sharing. I hope that the essential feature will reassure my hon. Friend: any arrangements proposed in future for greater sharing of administrative data will need to be agreed between the Department responsible and the new statistics board—and not only that, as the provisions will be set out in secondary legislation, which I have ensured will be subject to the affirmative resolution process, giving the House a further opportunity to scrutinise and then approve such arrangements in future.
I am grateful and add my congratulations to the Government on introducing the Bill. However, going back to the need to gain public confidence in published data, I propose a comparison with the establishment of the Monetary Policy Committee. Under the previous Conservative Government, that committee was established without total independence, but the present Government, to their great credit, gave it complete independence in deciding its business. Would not the move to re-establish public confidence in statistics be advanced if the commission itself—rather than the House or the Government—could decide which series of data it published? In other words, I make a plea that today’s Bill be a Brown rather than a Clarke reform.
If my right hon. Friend examines the detailed proposals, he will see that the principal part of the system is not about the publication of data, which he is talking about, but the assessment and standards relating to that publication. He is right to point out that this is indeed the next step in the Chancellor’s reforms of the machinery of economic governance—[Interruption.] If I can finish my sentence, I shall add that the new system is based on the approach adopted by the Government towards the independence of the Bank of England, the setting up of the Competition Commission and the Financial Services Authority—all moves in which formal devolution of ministerial power was accorded to credible, independent institutions with a clear remit set by Parliament and the Government. That is very much the approach that we are adopting in the Bill.
On the question of data sharing, does the Minister accept that it is essential that information does not reside in silos and that relevant information can be compared and measured so that reality can be tested? It is important that that is made as clear as possible, and that the legislation is made as enabling as possible. The Leader of the House will be familiar with the example of local authorities and the police being frequently reluctant to share information, even for the purposes of crime reduction. Specific measures needed to be put into the legislation in order to underline the public interest in the proper sharing of data. Surely that also applies to sharing the details of much statistical information.
My right hon. Friend is right that there is indeed a strong public interest in greater sharing of administrative data, but I have to tell him that there is also a public interest in ensuring that the confidentiality of such data is properly protected. I hope that he will recognise that the clauses strike an appropriate balance between those two objectives. What is clear is that stronger sharing of administrative data can improve the quality of statistical data and analysis, and therefore improve our ability to make and judge the impact of policy while reducing the burden on those responsible for or required to complete the surveys on which many of our official statistics depend.
In the name of the 1,300 people who work in the statistics office in my constituency, I welcome the Bill. They have been distressed in the past by the collapse, due to the perception of ministerial interference, of much of the credibility of Government figures. Will the Minister guarantee that the Bill will enshrine the independence of the national statistician and the statistics board—or Y Bwrdd Ystadegau, as it will be called in Wales—so that they will be immune and untouched by any future ministerial or governmental interference of any colour?
The Office for National Statistics, particularly its programme to relocate much of its personnel and expertise to Newport, has found a very warm welcome in my hon. Friend’s constituency and city, and I pay tribute to Newport for that. I can tell my hon. Friend that the Bill achieves precisely what he is looking for: it enshrines in legislation an independence for the national statistician and the statistics board, which should contribute in the longer run to the rebuilding of greater confidence and trust in official statistics. Our job in this House—and our job as a Government who are prepared to relinquish many of our present powers—is to set up a framework in which to develop greater quality and integrity for our official statistics.
Statistics are collected on only seven of the eight indices of social exclusion listed by the social exclusion unit. No statistics are collected on family breakdown. Does the Financial Secretary agree that it would be tremendously empowering for local practitioners who are trying to deal with that issue if such data could be collected by local neighbourhood area? Will he undertake to look into that omission?
I am sure that the hon. Gentleman will wish to elaborate on that point in the debate on social exclusion that will take place on Thursday. In the context of the Bill, however, the duty that will be placed on the independent statistics board will be to assess, comment on and publicly report to the House on the comprehensiveness and quality of the statistics. The board will take a view on the adequacy not only of national statistics but of all official statistics. I am sure that the point that the hon. Gentleman has made—and which he might develop in Thursday’s debate—will be taken into account by the statistics board when it comes to discharge its functions.
I am grateful to the Minister for giving way; he is being typically generous in doing so this afternoon. I should like to take him back to the point made by the right hon. Member for Birkenhead (Mr. Field), who suggested that the statistics board should be given the power to decide which statistics should be national statistics. Why is that power to remain in large measure in the hands of Ministers? How can we hope to restore public trust and confidence in the system while it remains in their hands?
This is an issue that hon. Members will wish to consider carefully, both in this debate and in Committee. I am sure that the hon. Gentleman would acknowledge that our national statistics now cover some 1,300 statistics, including all the most important economic statistics and many of the most important employment and public service data sets. These help to inform us about the state of the economy and society, and they are covered by national statistics. I hope that he would also recognise that the coverage of our national statistics system in this country is as broad as, and comparable with, that of any other developed economy.
The Financial Secretary has stated explicitly that the statistics board will be independent of the Government and accountable instead to Parliament. That sounds like a good idea, but we need to be sure that that represents something more than just an abstract constitutional doctrine and that it will have meaningful effect. Will the Financial Secretary therefore tell the House what, in practice, will be connoted by the term “scrutiny”? What will we get that we do not already have, in terms of the opportunity to ask oral questions in one form or another, or an opportunity analogous to the debate on the reports of the Public Accounts Committee for Parliament independently to consider the independent output of the statistics board?
I am glad that my right hon. Friend the Leader of the House is here, because the hon. Member for Buckingham (John Bercow) will appreciate that his question relates precisely to matters that the House should consider for itself. It is not for me, or for the Government, to specify those arrangements. I have already said, however, that I hope that, alongside the passage of the Bill, there will be an active debate in the House about the nature of the scrutiny and the accountability that the House will require for the new independent statistics system and of the new board. The hon. Gentleman has a forensic mind for some of these matters, and I hope that he will help to lead that debate in the House.
The Financial Secretary asserted that the coverage of national statistics was very wide, and that the concerns about the narrow scope of the Bill being expressed on both sides of the House were therefore unjustified. Is he concerned about the Home Office’s statement to the House of Commons Treasury Committee that only 12 per cent. of its statistical outputs were accredited as national statistics? That shows that the scope of national statistics is limited, and unless the scope of the Bill covers all official statistics it will not restore people’s trust and confidence in official figures.
I should like to make two points. First, as I have said to the hon. Lady, the scope of the Bill is not narrow but includes all official statistics. The statistics board will have a duty in statute to assess, comment on and report to this House on quality, good practice and coverage in respect of all official statistics.
Secondly, the hon. Lady may like to know that this afternoon I placed in the House of Commons Library the updated list of national statistics, which totals nearly 1,300 statistics. Surely what is most important and practical is not that the board’s audit function, about which I think that the hon. Lady was talking, should cover all Government-produced statistics, but that it should cover the most important Government statistics. That is precisely what the national statistics system is designed to achieve.
The Bill makes it clear that the residual functions and responsibilities discharged by the Chancellor will be transferred to the independent statistics board. Only in the very narrowest circumstances, defined by the Governor of the Bank of England, will the Chancellor be involved in any way in future. We have decided that because of the potential impact on the gilts market and the public finances.
I am grateful to the Financial Secretary, who has been extraordinarily generous in giving way this afternoon, for letting me intervene. He and others have already underlined the importance of the independence of national statistics if they are to maintain the confidence of the nation. Is it not also important that there should be consistency? For instance, coroners are entirely free to determine at their own will what counts as a drug-related death. If each coroner around the country records a death as drug-related for different reasons against different criteria, however, the statistics gathered on the back of such judgments will mean absolutely nothing. Will there not still be a role for the Government and Ministers to make sure that there is some consistency in how such things are measured?
My hon. Friend raises an interesting specific example, which, it strikes me, relates principally to policy decisions that will remain part of the delivery of the coroner service and will therefore be for Ministers to decide; arguably, that will be part and parcel of managing and administering the coroner service. However, in respect of the methodologies and professional standards by which such data may be gathered, I am sure that the statistics board will take a view, as part of its general remit, on good practice, and on the quality and coverage of the statistics system.
I should like to ask a more practical question. The national statistician talked about a lack of relevance to ordinary people’s experiences with respect to the consumer prices index. I am curious about how the changes will impact positively on pensioners, for example. They are experiencing inflation of up to 9 per cent., whereas the CPI shows an inflation rate of only about 2.4 per cent.
For the conduct of monetary policy and Government economic policy making, we clearly have to have a national index of inflation, and that is established by the CPI. As any close examination of the statistical composition of price indexes shows, over a period some prices of some items will go up and some will fall. That has been the experience of recent years. Clearly, we have to aggregate those figures. Our index serves our purposes well; it covers a very wide range and basket of items, which are constantly updated to reflect modern consumption and economic activity in this country.
I shall give way to the hon. Member for Braintree (Mr. Newmark) once more. I shall then set out some substantive matters to the House as part of the opening of this debate, and—if he and other hon. Members will forgive me—try to make a bit of progress.
I do not mean to try the Financial Secretary’s patience, but the fact is that there is a lack of trust. We cannot be cavalier and simply say, “This is what it is.” When real people are experiencing a higher inflation rate than that described in the official statistics there is a problem, and I am curious about how the Bill will reconcile those two conflicting elements.
The overall inflation rate is the same for everyone. As I have explained, some items may be subject to greater inflation or deflation than others, and patterns of consumption may therefore impinge differently on different people. For instance, the cost of private education has risen considerably more than the general aggregate index—a fact that may concern Conservative Members. The single aggregate index that is required, however, demonstrates a system that is refined in the light of experience. In future it will be set out as a responsibility for the statistics board, and it will be more independent than the current system. Both the hon. Member for Sevenoaks and my right hon. Friend the Member for West Dunbartonshire, as members of the Treasury Committee, have argued for that for some time.
The Bill follows major statistical reforms that the Government introduced in 2000, which established the position of the national statistician, the concept of national statistics and the functions of the Statistics Commission. It is right now to build further on those reforms. The Bill is a tribute to the work of the Statistics Commission: it draws on that work and develops the commission’s duties, particularly the duty to monitor and report on the quality and coverage of all official statistics.
The reason why it is right now to legislate for the independence of statistics and build on the reforms that we have already introduced is that statistics matter—the interest in today’s debate is testament to that—and in a rapidly changing economy and society, they matter more and more. They provide the data that help us to analyse and understand our economic, demographic, political, environmental and social worlds, and they form the evidence for debate, planning and policy. Importantly, in our modern democracy they inform the judgments that people make about the promises and performance of their Government.
Statistics are central to the business of government, but they serve us all. They are a much wider public good, with an ever-widening range of users and currency. However, while United Kingdom statistics are widely regarded as among the best in the world, perceived levels of trust in the figures in our system are lower than we would want them to be. We are legislating for a system that can develop in the light of experience and in response to changing demands from users, and can, through its operation, raise levels of public confidence in Government statistics.
We are legislating not just for the statistics currently produced by the Office for National Statistics, which encompass population estimates, labour market statistics and the production of the national accounts, but for the statistics produced in other Departments. In doing so, we are retaining the strongly decentralised nature of United Kingdom statistical production, a feature that has been a characteristic of our system for as long as statistics have been collected. We have been compiling official statistics— for instance, on imports and exports—for almost four centuries, and our first population census was conducted about 200 years ago.
The benefits of such a system are clear, and are widely recognised. Our approach was supported by the vast majority of respondents to our consultation last year, including the Treasury Committee and the Statistics Commission. Not one of the 79 responses to that consultation argued for the removal of the statistical role of Departments and the centralising of all production in some form of super-ONS.
I will come on to that a little later, if I am able to reach that point in my remarks, but let me say at this stage that many respondents strongly considered that arrangements for pre-release needed to be tightened and that arrangements for pre-release as they currently stand contributed to a lack of public trust in our statistics.
I thank the hon. Gentleman for generously giving way again. Given that the Bill purports to be about—and might prove in substantial measure to be about—independence, why is it that under clause 11 the Government judge that they should in effect be the exclusive arbiter, or “appropriate authority”, in deciding whether a statistic should enjoy the status of an official statistic? Why should that be determined only by the Chancellor?
If the hon. Gentleman looks more closely at the Bill, and in particular at clause 11, he will see that it is not for the Chancellor to determine that, but for Ministers. I think that he will also find that he is talking about not official statistics but national statistics—a point that was made by the hon. Member for Chipping Barnet (Mrs. Villiers). I shall address the detail of that a little later.
In a decentralised statistical system—such as that which we have had in this country, which is well established and brings significant benefits—the most effective way to ensure both independence and the highest standards of integrity and quality is through independent setting of standards and independent assessment and reporting against those standards. That is precisely what the Bill would set up.
We recognised from the outset that there was no question of reopening—or of somehow undermining—the devolution settlement in respect of the United Kingdom statistical system, but, following the decisions of Scotland, Northern Ireland and Wales to be part of the new system, I am delighted that the Bill and the board’s remit cover the whole of the UK. The Treasury Committee report, and the evidence, was particularly exercised by that. That underlines the importance of what we are trying to accomplish. The new arrangements will help to deliver more coherence and more comparable statistics across the four countries in the future.
Let me turn to the main details of the content of the Bill. At the heart of the Bill is the creation of an independent board, as set out in clause 1, whose core objective is to promote and safeguard quality, good practice and comprehensiveness in respect of official statistics. It will achieve that objective by performing three principal functions. The first of them is the statutory duty to monitor and report on areas of concern about quality, good practice and coverage of all official statistics across Government and Government arm’s-length bodies. It will also carry out that function by developing and promoting definitions, methodologies, classifications and standards for all official statistics.
Secondly, as set out in clauses 10 to 17, the board is required to draw up a code of practice that will set professional standards for the production of national statistics and assess and approve all existing national statistics against those standards. It must also assess any additional statistics nominated by Ministers as potential national statistics, and publish the results in respect of those statistics for all—especially Members—to scrutinise.
The third function that the board will perform to achieve its objective is to oversee the executive office of the national statistician, and we expect that office to discharge the board’s statistical production functions, which are currently undertaken by the Office for National Statistics.
We have an established system for judging our fiscal rules and the economic cycle. As the hon. Gentleman knows, the National Audit Office audits the assumptions that we make, and the data on which that is based are produced by the independent Office for National Statistics. The NAO has independently audited the start of the economic cycle and it will be asked to audit its conclusion. The hon. Gentleman must concede that the existing system has a significant element of independence and transparency and is fundamentally different from the way in which the previous Government conducted economic policy making.
On setting standards, the hon. Member for South-West Bedfordshire (Andrew Selous), who has now left his place, raised the question earlier of family life, and it is my view that such studies are best carried out in an interdisciplinary way. When the board looks at standards, will statisticians work with other researchers in a long-term study to ensure that we examine not simply snapshots of family life on a particular day, but what happens to families in the long term, so that we can properly inform and determine public policy?
My hon. Friend makes an important point. Of course, the Bill deals with official statistics, but a good deal of other research is conducted and we should bear in mind the high professional standards of the national statistician and of the ONS. Given that there will be strong representation of the users of statistics among the non-executive positions on the board, I am certain that it will take into account precisely those interests and concerns.
I am grateful to my hon. Friend for his usual generosity in giving way. As he knows, it is my view that one reason why we have difficulties with pensions is that actuaries messed up their interpretation of growing life expectancy and did not advise pension schemes accordingly. Against that background, can he assure me that the statistics board will not be packed with actuaries—either among its three executive members or, most importantly, among its six non-executive members? The track record of that profession is at best mixed.
My hon. Friend makes the point that he often makes about his view of actuaries. I can give him that general assurance, and nor will the board’s six non-executive members all be statisticians. It is important that we have the strongest possible board and the widest range of user interests, in order to constitute the governance and authority that this independent body requires from Ministers. Furthermore, my hon. Friend may be interested to know that the board will be established as a non-ministerial department and that it will have a majority of non-executive members and a non-executive chair, who will be appointed by the Queen. We will ensure that its members are appointed in open competition, in line with guidance from the Office of the Commissioner for Public Appointments.
As I was saying, we want the non-executive membership to bring to the board a broad range of skills and backgrounds—in business, academia and public service—in order fully to represent the range of interests of users of official statistics. That will be crucial in ensuring the board’s credibility, its ability to hold the national statistician properly to account for the running of the executive office, and its ability to discharge its wider responsibilities for the quality and integrity of statistics.
There, are, however, some criticisms of the approach that we are taking, so let me try to deal with them. First, some say—indeed, one or two Members have raised this issue this afternoon—that the scope of the system of board assessment and approval should apply to all Government statistics, not just to national statistics. A second argument that has commonly been made is that the board and not Ministers should have responsibility for submitting additional statistics for assessment and approval as new national statistics. I have looked very carefully at both the cases that have been made, and let me try to explain to the House why we have drawn the conclusions captured in the Bill.
On scope, first, the nature of statistics, how they are published, the sources of data used, the officials responsible and the methods of production are all widening and changing rapidly. In Government, we no longer just use the traditional collection methods of surveys and census: important statistics are increasingly derived from administrative and management systems. We no longer see statistics as a semi-academic discipline, with statisticians working in the isolation that implies. Increasingly, statisticians contribute with other analysts as key members of multi-skilled, multi-disciplinary teams. We also no longer expect professional statisticians to produce only formal series of statistics. Increasingly they offer expert advice on many other issues and other Government products with a statistical component.
The old definitions of what is and what is not a statistic are becoming blurred. In a modern statistics system, in which we have determined that decentralised production and the flexibility to respond to user needs are real strengths, what is most important and practical is not that the board, and its independent audit function, covers all Government-produced statistics, but that it covers all the statistics that are most relevant to policy formulation, delivery and accountability and, of course, those statistics that are most valuable to business, academics and a wide range of other users.
I trust that the House will accept that statistics produced and published by the Government differ in importance. Few would contest the importance of unemployment statistics for a wide range of purposes and users. Others may regard the results of the television export survey, carried out by the Department for Culture, Media and Sport, or the egg bulletin as less important. Still fewer would argue that regularly published data on departmental stationery consumption should be treated in the same way or with the same status as the jobless figures.
It seems strange that the Government are prepared to contemplate a range of official statistics that do not comply with a code of practice that is essentially ethical. The draft code produced by the Statistics Commission suggests that it will cover issues such as integrity, honesty, objectivity and impartiality. Why produce official statistics that do not comply with such basic principles? What will be the value of such statistics?
The hon. Lady has got the wrong end of the stick. The point about the code and the responsibility of the statistics board is not only that it formulates the code, but assesses the national statistics and their production against that code. Clearly, with such a wide—and widening—range of Government data, it does not make sense to give the same attention or submit to the same process as the jobless figures, or the economic data that constitutes the national accounts, to some of the more minor examples that the hon. Lady, if she considers some of the 1,300 national statistics that I have placed in the Library, will accept should not be accorded the same status or importance.
Does the Financial Secretary accept that the difficulty is often not the type of statistics but the frequency? For example, the quarterly waiting list figures, which are national statistics and highly politically sensitive, would be subject to the code of practice, but the monthly figures, which come from the same raw data, would remain official statistics to be used or abused by the Department without the same degree of scrutiny. How can he justify the difference in approach?
As I said earlier, the purpose of the Bill is to create a framework that can evolve in the light of experience and changing demands from data users. I would expect the board, as part of its statutory duty to comment on the comprehensiveness and coverage of official statistics, which I have explained, to look at precisely those matters. I would also expect there to be a much stronger incentive and discipline for Ministers to look actively at submitting additional departmental statistics for approval as national statistics where they are central to the policy functions or delivery of programmes for which those Ministers are responsible.
The hon. Gentleman seemed to be perilously close to suggesting that some statistics currently collected and collated by the Government are not worthy of the process. I hope that is not his position, but he needs to clarify that statement. On the assumption that he does not believe that the Government currently collect an exhaustive supply of statistics and that he is, therefore, open to suggestions as to additional statistics that it would be useful to have, may I put it to him that if the board recommends that a new statistic relevant to policy be collected but a Department wishes to decline that request, it ought at least to have a duty publicly to state its reasons for so declining?
No doubt we shall return to such detailed points in our deliberations in Committee. However, in my view, where Ministers are also responsible for deciding about resources in their Department, including those devoted to statistical production, such decisions are about policy and resource rather than about professional and technical matters. They should thus properly be matters for Ministers, not for statisticians.
Does my hon. Friend agree that cynicism about Government statistics is not new? Alan Clark recalled in his “Diaries” his view that the only useful purpose of the Department of Employment was to meet once a month to fiddle the employment and unemployment figures, and that it was probably the biggest and most disreputable massage parlour in the kingdom. We should look to the responsibilities of not just one Government but all Governments and give credit to the Labour Government for their great work in restoring the independence of Government statistics.
I welcome my hon. Friend’s remarks and his support for the work of the ONS more generally. I am glad that he takes an active interest in such matters; perhaps we may persuade him to follow a little more closely the Bill’s progress after Second Reading.
I want to make it clear that the board will be strengthened by the presence of the national statistician—a post that the Bill makes statutory for the first time, and which will have the title “national statistician” in light of the responses to the consultation.
The Financial Secretary refers to the welcome statutory basis for the appointment of the national statistician, but it is not clear from the Bill whether the national statistician will be appointed on the advice of the Prime Minister rather than the Chancellor, or indeed whether he will have direct access to the Prime Minister in the event of disputes, as, for example, Claus, now Lord, Moser used to enjoy and the service chiefs enjoy at present.
The national statistician will continue to be the Government’s principal statistical adviser and will continue, as she does at present, to speak out and comment publicly; but in future, under the Bill, the national statistician will be accountable and report not to Ministers—as she does at present to me—but to the independent statistics board. The board will be directly accountable not to Ministers but to Parliament. That reinforces the independence of the national statistician and, as I was about to make clear, it also reinforces the national statistician’s professional position. The national statistician will be the board’s chief executive and—this point may help the hon. Gentleman—the legislation will require that the board should publish its decision, and lay a report before Parliament, if it overrules the advice of the national statistician on professional matters. The national statistician will, of course, continue as the Government’s principal statistical adviser, and as the professional head of the Government statistical service.
In addition to spelling out the main provisions of the Bill, I can confirm to the House further details of our plans in three areas: transition arrangements; funding; and pre-release.
The House will appreciate that we are keen to ensure a smooth transition to the new system. Without prejudicing the views of this House in any way, may I say that we intend the system to begin in April 2008? I therefore aim to have appointed a shadow chair, with appropriate support for that chair, before the start of the new system, so that many of the crucial aspects of planning for the implementation can be steered and led by that shadow chair. I hope that the appointment will be made during the course of this year.
I have already made it clear that the funding arrangements for the board should reinforce statutory independence, and I have announced that the board’s funding will therefore be set outside the normal spending review process. The aim is to ensure that the board has a certainty of funding over several years, to aid long-term planning and to minimise the dealings that the board will need to have with the Treasury.
I can confirm that the Government will guarantee the board’s funding over five-year periods—considerably longer than the three-year settlements that apply to other Departments through the spending review process. The certainty will be guaranteed through the setting of a transparent formula for the annual resources to be given to the board in each of those five years. Following consultation responses and the recommendations of the Treasury Committee, I can confirm that we propose funding the census on a similar five-year period, integrated with the overall budget of the board.
I was not sure at which point in the debate I might seek clarification on an aspect of the census. I speak as chair of the all-party group on UK Sikhs. There is a considerable movement in parts of the Sikh community in the United Kingdom for separate census enumeration for Sikhs, who, under the Mandla case of 1984, are a racial group as well as an ethnic one. Using that as an example, will my hon. Friend say how representations could be made when the new system comes into force so that a question relating to that matter could be included on the census? At the moment, we make what might be termed “broadly political” representations, but I understand that there will be a different scenario under the board. Will he explain how the process will work and, in terms of the time frame, whether the 2011 census and the questions thereon will have been finalised before or after the new board is set up?
The answer to my hon. Friend’s first question is that technical queries about methodology and questions should appropriately be directed towards the national statistician. That is unlikely to change under the new arrangements.
Secondly, I should make it clear to my hon. Friend that something else will not change under those arrangements: after this year’s pilots of the 2011 census in five areas, the House will have the opportunity to consider the results of the pilots and the content of the census for 2011, which will be approved by this House, as has been the case in the past. My hon. Friend and the Sikh interests that he is concerned about will have the opportunity to make technical and professional representations. He will also be able to debate the decisions and proposals as part of the approval process for this House before the census is conducted.
I wanted to make a final point about funding. It will be for Parliament to hold the board to account for the way in which it allocates and controls its resources, in the same way as Parliament ultimately does for the rest of Government and for the Office for National Statistics.
The Bill provides for the reform of statistical pre-release access arrangements. In principle, there is a clear case for pre-release access to statistics for Ministers and policy officials, and the Treasury Committee supported that view in its report. The reason for allowing such access is that, when the statistics are released, Ministers need to be able to give an account of the implications on the policy areas for which they have democratic responsibility. That is what the British public have come to expect, and what the British media have come to demand. Additionally, in the case of market-sensitive statistics, Ministers may be required to announce policy changes to coincide with the publication and release of data; for example, mitigating action might need to be taken in respect of currency management in light of certain balance of payments or trade statistics, and the Government and the Bank of England might need to make announcements about the open letter system in light of inflation data.
I will come to the specifics of pre-release periods later. I think that that is the subject in which the hon. Gentleman is principally interested, but of course pre-release arrangements also cover the nature of the data that are to be pre-released, and the range of officials or Ministers that may have access.
The Minister referred to market-sensitive figures that are pre-released to Ministers. Was he concerned when the Prime Minister leaked unemployment figures to the Trades Union Congress before they were due for publication, resulting in a movement of the market?
All the established procedures were followed after that inadvertent indication of the unemployment statistics. If the hon. Lady looks at the reports of the Statistics Commission, which currently has the responsibility of investigating any apparent breaches of pre-release codes, she will see that although the perception is that pre-release arrangements undermine the integrity of statistics, such occurrences are in fact relatively rare. The commission investigated six breaches last year, and two breaches in the year before that, which was 2005. If she studies the reports, she will find that such breaches are inadvertent and generally involve not Ministers, but officials, and are the consequences of slip-ups in the system.
I am grateful to the Financial Secretary for giving way; he is being most generous with his time. In his justification of a continuation of the relatively lengthy pre-release period in the UK, compared to in other countries—a point referred to by the hon. Member for Twickenham (Dr. Cable)—he mentioned the issue of currency policy. The foreign exchange control regulations were abolished by the previous Conservative Government, but are there any examples of the current Government implementing any policy on the back of statistics?
For any Minister accountable directly to the public and the House for policy areas that impinge on market-sensitive statistics, it is important that the principle of pre-release access is in place, so that if the circumstances demand policy decisions, they can be made. That is our view, which is supported by the Treasury Committee.
It is on that very point that I would like the Minister to respond. He said that there had been an “inadvertent indication of the unemployment statistics”, but the truth is that what we witnessed was a blatant abuse of Government statistics. Surely we must include in the pre-release arrangements something that can prevent such blatant abuses from taking place again, and that must mean ensuring a much shorter pre-release period—one more in line with those in other countries—than the one provided for in the current arrangements, or under the Bill.
I accept the general argument for tightening the pre-release arrangements, and the Bill and the secondary powers introduced under it will do just that. However, it is not simply a question of setting out the detail of pre-release arrangements, as they must be consistent, clearly understood and transparent. They must be independently assessed and reported on, including directly to the House, by the new statistics board. Over time, that will help to reinforce and increase trust and confidence in official statistics and pre-release arrangements.
I, too, am grateful to the Financial Secretary for his generosity in accepting interventions. However, he was unable to give my hon. Friend the Member for Ludlow (Mr. Dunne) an example of a Government policy that was announced as a result of access to statistics prior to their release. He prayed in aid the Treasury Committee report, which recommends that
“ministers receive pre-release access on the day prior to release, after the markets have closed”.
We are therefore discussing limited pre-release access, and not the 40 hours allowed under the Bill.
On Second Reading, we deal largely with the Bill’s principles. I hope that the hon. Gentleman, who has shown a consistent interest in Treasury matters, will serve on the Public Bill Committee, which will probably deal with detailed examples of what is, or is not, covered by pre-release arrangements. Ministerial access to pre-release data is a widely accepted and established international principle, with many countries, including Australia, France, New Zealand, Ireland and the USA operating a pre-release regime. As I suggested earlier, however, a number of respondents to the consultation argued that the concept of pre-release contributes to the perception of ministerial interference in statistics, particularly the terms and nature of the voluntary pre-release code. I can confirm to the House that we will tighten the system so that pre-release arrangements will have a special status. Unlike the rest of the code, the contents of which will be backed, but not prescribed, by statute, the new pre-release rules will be set out in secondary legislation under clause 11.
I have ensured, first, that they will be subject to affirmative resolution so that Parliament has a further opportunity to debate and approve arrangements in future. Secondly, we will place a statutory duty on the new statistics board to assess and report on compliance by Ministers and officials with the new rules. Thirdly, we will cut pre-release access to non-market-sensitive data from five days to 40.5 hours to align it with access to market-sensitive data. Fourthly, we will set out principles in secondary legislation to provide guidance for Departments and ensure that access is limited only to those individuals who require data for operational reasons. I am confident that the new arrangements will provide greater clarity and transparency and, crucially, will be more enforceable. They will help further to reduce perceptions of ministerial interference in statistics. Finally, as I have explained, the Bill establishes in general a statistical system that can be developed in the light of experience. We will review the operation of the new pre-release system 12 months after it starts.
Some of the safeguards that my hon. Friend announced, particularly the second one, are foreshadowed by clause 8, which usefully states that the statistics board may
“report any concerns it has about…good practice in relation to any official statistics…The Board may publish its findings or any report under this section.”
If the board believes that pre-release statistics have been misused by Ministers, it can make a public statement, as it is accountable to Parliament rather than to Ministers. Is that not another safeguard in the Bill?
My hon. Friend, with his customary close attention to detail, is right. The general duty that the statistics board will have in relation to coverage, good practice and the standard of all official statistics will allow it, as I indicated earlier, to report strongly where it perceives flaws or failures. In addition to that, as I made clear to the House, we will put a specific statutory duty on the new statistics board to report publicly to the House on the compliance of officials and Ministers with the new code on pre-release.
Furthermore, I can announce to the House today that the Government are committed to the principle of creating a central publication hub, which many commentators called for, through which all national statistics would be published under the new system, thereby separating statistical release from policy comment.
Let me mention briefly three other aspects of the Bill that have generally been widely welcomed. The first is data sharing and confidentiality. Clauses 35 to 43 provide for the flows of information that currently exist between the Office for National Statistics and other bodies to continue under the new regime. However, we are using the opportunity of the Bill to put in place a framework to allow data sharing for statistical purposes only, and we are also putting in place tougher sanctions and safeguards to protect confidentiality.
As was pointed out to us forcefully in the consultation, data sharing has the potential to bring real benefits in improved statistical analysis, and therefore to the evidence base for policy making and better resource allocation. It also, as I noted earlier, reduces the burden on businesses and individuals of completing surveys, particularly on information already held by Government. Following the strong support that we received for these plans in the consultation, the Bill includes in clauses 44 to 50 provisions to allow Treasury Ministers, a Northern Ireland Department or Scottish Ministers with consent from the Treasury to make regulations for increased data sharing between public authorities and the board.
All proposals to allow greater or new administrative data sharing will be subject to further debate and approval by the House. They will also be subject to the affirmative resolution procedure. Clause 36 contains comprehensive safeguards enforced by criminal penalties for the unlawful disclosure of information which identifies individuals or businesses.
A second aspect that has generally been welcomed concerns the registration function which is currently carried out by the national statistician and the Office for National Statistics as the Registrar General. The historically close relationship between the statistics and registration services inevitably means that there will be consequential changes to the registration service, which at present is administratively part of the Office for National Statistics. As part of our reforms, we must deal with that situation.
We have been considering in particular the position of the General Register Office and of the NHS Central Register within the machinery of government. I can confirm to the House that there was general support in the consultation for the proposals to separate the GRO and the NHSCR from the ONS, and to retain these functions under ministerial responsibility. The details are being worked out. The transfer is therefore not provided for in the Bill, but will be carried out by a subsequent transfer of functions order. During the period of transition, the statistics board will be able to provide services and continue providing services, should those be required, to the GRO or the NHSCR.
I do not want the Second Reading debate to pass without mention of one final aspect of the Bill. It is one on which I have worked closely over a number of years, but not as closely and not as long as has my hon. Friend the Member for Bolton, South-East (Dr. Iddon). We are using the Bill as an opportunity to establish proper employment status and rights for registrars in England and Wales. I know that my hon. Friend attaches great importance to that objective, which he has worked on for a long time—he has served with distinction as the president of the Society of Registration Officers.
Registrars provide a vital service, which benefits the whole community. However, while they are statutory officers appointed and paid by the local authority, they are not employed by the local authority. They can only be dismissed by the Registrar General, and consequently they do not enjoy the rights and protections that are taken for granted by other groups of workers, such as access to an employment tribunal. The Bill will make the 1,700 registration officers into local government employees and give them access for the first time to the rights and protections that are already available to others. It will also ensure that registration officers retain their current terms and conditions on transfer to local authority employment.
In summary, the Bill is a step forward in what will be a major and evolving programme of reform to our statistical system. It holds out the possibility of substantially improving the quality of and confidence in official statistics. We are introducing a framework that can lead to a world-class statistics system capable of meeting the changing demands of a modern economy and of a modern society for reliable statistics. I commend the Bill to the House.
In scrutinising this Bill, the Opposition’s goal is to restore public trust in official figures by taking politicians out of the process of the production and release of Government statistics and removing their power to manipulate and spin the figures for their own short-term political ends, which is a vital task in securing more honesty, integrity and trust in politics today.
The Financial Secretary and I are at one on the importance of the task that faces the House this afternoon and on the importance of statistics. The 19th-century Belgian statistician Quetelet once stated that
“The statistician keeps his fingers on the pulse of humanity and gives the necessary warning when things are not as they should be.”
More recently, John Hollis of the British Society for Population Studies has pointed out that
“National Statistics are vital to public policy and to decisions made throughout the public and private sectors. These decisions and policies affect the lives of each of us. Billions of pounds are allocated on the basis of National Statistics.”
Public trust in statistics must surely be at an all-time low—hence the hollow laughter that greeted Her Majesty’s announcement of this Bill in the Gracious Speech. According to an ONS survey, 17 per cent. of people—fewer than one in five—believe that official statistics are produced without political interference. I must say that I have not met many of the 17 per cent. who believe in the probity and objectivity of this Government’s treatment of official statistics.
Let us take just a few examples. Manipulation of NHS figures has become notorious under Labour, with trolleys having their wheels removed or being reclassified as “beds on wheels” to massage A and E waiting time figures. The Governor of the Bank of England no less recently criticised the Government for their failure to produce reliable migration figures and their inability to answer the basic question of how many people actually live in this country.
The hon. Lady has implied that this is a new phenomenon. The Royal Statistical Society has pointed out that
“for several decades now, a lack of trust due to a wide perception of political interference has devalued and undermined official statistics”.
I counsel the hon. Lady that she might do better to focus on the measures in the Bill to improve the reliability of statistics and public confidence in them instead of engaging in knockabout, because her party’s performance when it was last in government was absolutely disgraceful. I remember issuing a press release jointly with a fellow of the Royal Statistical Society complaining about 23 manipulations of the unemployment figures. Let us not chuck mud at each other but talk about making the situation better for the future.
I assure the House that I am going to consider in detail these provisions, some of which are welcome and a step in the right direction. Nevertheless, it is important to look at some of the problems that have arisen as a result of this Government’s treatment of statistics.
Just for balance, for which the hon. Member for City of York (Hugh Bayley) is noted, let me point out, first, that all the adjustments were declared publicly in advance and they were not manipulations; secondly, that they did not all appear to reduce levels of unemployment; and thirdly, that the Government’s normal tactic is to blame us when they think they never did it and, when they think they have done it, to say that everyone else has.
Before we let the political knockabout go too far, should we not stick to some facts? I am using the ONS figures, which we accept that we can trust at least to some degree. When we look closely at those figures and people’s trust in them, it is clear that the more complex it is to analyse them, the less people trust them, while the easier it is, the easier it is for people to accept them. Figures on road traffic accidents are trusted because it is easy to count the heads of people who have died. It is harder to understand more complex figures, which is sometimes why people do not trust them. Let us not pretend that there is some political motive behind these changes—we should stick to the facts.
I am grateful to the hon. Lady. There is no doubt that there are problems in understanding complex statistics and that that makes some people hesitate to trust them. However, the much more serious problem is not the methodology or the complexity of the statistics but the way in which they are treated and released by Ministers. We need an ethical code to ensure that they cannot be spun, manipulated or subject to political interference.
The hon. Lady is saying that statistics should not be spun. She said earlier that confidence is at an “all-time low”, citing one statistic—17 per cent.—from one survey. She should know that in order to suggest that something is at an all-time low one needs a sequence of at least two statistics—it is not good enough merely to cite one.
I suggest to the hon. Gentleman that if he talks to anyone on any average high street he will be told whether people believe Government statistics. As he likes empirical evidence, let me turn to more examples.
No less a person than Professor Adrian Smith recently concluded in an independent report for the Home Office that crime statistics needed “a radical overhaul” and that certain major crime category definitions were “confusing and misleading”. Moreover, grave concern has been expressed about the decision to keep so many private finance initiative and Network Rail liabilities off the nation’s balance sheet even where it seems clear that the bulk of the risk is being borne by the public, not by the private sector. At the general election, the Opposition made a strong appeal for independence for statistical services. The Shadow Chancellor included that as part of his “triple lock” to entrench stability into the economy. We share the view of the Statistics Commission:
“The statistical system should serve the long-term public interest, rather than the interests of the government of the day”.
We welcome the Government’s move in our direction and their acknowledgement that the 2000 reforms were inadequate. We also welcome their attempts to ensure that the new structures apply across the UK. The people of Scotland, Wales and Northern Ireland have as much right to integrity in statistics as the people of England. However, we regret that it has taken them nearly a decade to provide parliamentary time for this reform, and we believe that the proposals before the House today are still too weak to secure statistics that are genuinely independent of political interference.
We shall not vote against the Bill, but we will make the strongest efforts to strengthen it during its passage through Parliament. We want to ensure that the full rigour of the reforms applies to all official statistics, not only to those nominated by Ministers to become national statistics; to ensure a clear split between the people responsible for producing statistics and those who scrutinise them; to strengthen independence from Ministers; and to restrict radically Ministers’ pre-release access to statistics.
It is unclear what the hon. Lady is proposing rather than simply criticising. Is it still her policy that statistics should remain a function, National Audit Office-style, of Parliament rather than the Executive? We have examined that carefully and the only example that we can find of such a model is in Mongolia. Does she still take her statistics policy from Mongolia and her tax policy from Estonia?
Valuable lessons can be learned from the NAO model. We do not propose to base our policy on what happens in Mongolia, but I shall deal shortly with the way in which we would try to strengthen the board’s independence from Ministers by adopting elements that are currently used for the NAO.
Indeed. Perhaps I should quote directly from the Leader of the House’s speech in 1995. He said that the new independent statistics organisation
“should be placed at arm’s length to Ministers on a similar basis to that of the National Audit Office, and should report principally to a powerful Committee of the Commons”.
The Leader of the House clearly believed that the proposal was credible and I am sorry that the Financial Secretary disagrees.
Does the hon. Lady accept that, in the 1997 Labour party manifesto—I can provide her with a copy—which appeared a good two years after the speech to which she refers, Labour committed itself to setting up an independent system of national statistics? We did precisely that in 2000, under the new national framework. We are now moving to reinforce it further by entrenching the independence in legislation. It would be nice to hear the hon. Lady welcoming those moves.
As I said, I welcome a step in the right direction, but it is too timid and will not restore the public trust in Government statistics that the Financial Secretary wishes to see.
The scope and impact of the code of practice are key issues. We warmly welcome the proposal in clause 10 that the new statistics board draft a code of practice. However, the Bill does not oblige anyone to comply with the code—a striking omission. We will seek to amend that significant flaw and impose a legal obligation.
Even more worryingly, the Bill envisages the code of practice operating in relation only to National Statistics. The Opposition believe that all official statistics should be subjected to the code of practice and the full rigour of the reforms. As drafted, the powers that the Bill grants the board for official figures that fall outside the scope of National Statistics are limited and vague. Consequently, the Bill focuses primarily on the Office for National Statistics, which, as distinguished former national statistician Lord Moser has pointed out, is the part of the statistical system least in need of reform.
It is wrong to assert that the Bill or National Statistics focuses principally on what the ONS produces. The ONS is responsible for approximately 250 national statistics. That leaves a little more than 1,000 national statistics that are produced elsewhere in Government and will be subject to the code, the independent assessment and reporting by the statistics board.
As I have stated, we have evidence that a range of important figures currently fall outside the National Statistics system. I refer again to the figure that the Home Office produced and that the Library reported: only 12 per cent. of Home Office statistical output is covered by the current National Statistics system. If we are to secure statistics that are genuinely free from political interference, it is critical to ensure that the reforms encompass not just National Statistics and the Office for National Statistics, but the decentralised statistical activities of different Government Departments. The Statistics Commission agrees that
“the biggest issues are outside the ONS”,
and has rightly called on the Government to ensure that the reforms
“address the totality of the system”
or “risk public confidence in” departmental
“statistics being reduced rather than enhanced”.
The Bill leaves intact the two-tier system between National Statistics and other official figures—a system about which many have expressed concern. Retaining that two-tier system may not bother the Financial Secretary, but it is a matter of concern to the Audit Commission, the Treasury Select Committee, the Statistics Users Forum, the Market Research Society, the Statistics Commission and the First Division Association of senior civil servants.
Under the Bill, Ministers will retain the power to decide which statistics from their Departments should go forward for assessment to become part of the National Statistics system and which should not. As the Royal Statistical Society has pointed out, that effectively gives Ministers the job of deciding whether the legislation should apply to them or not. The Treasury Committee concluded that that approach would leave out some of the most frequently quoted data and performance indicators on health, crime, education and the management of public services.
For example, as we have already heard from the Liberal Front-Bench spokesman, quarterly NHS waiting lists are national statistics, but monthly ones are not. Figures on sensitive issues such as race and the criminal justice system are not national statistics. Lord Moser described it as “a very basic flaw” to have a category of statistics that are “left totally” in Ministers’ hands. He said that it was a formula for lack of trust, because anybody who looks can see that the Minister has decided that particular things do not go anywhere near the ONS. Charles Bean, chief economist at the Bank of England, expressed concern that retaining a ministerial veto over which figures could be treated as national statistics appeared
“to run against the broad thrust of the proposals”
to make statistics more independent of the Government.
My hon. Friend touches on a really important point: the power of nomination and the power of initiative. It is important that the power to propose statistics for designation is within the hands of the board. If Ministers are so keen to keep some of that power within their Departments, there is no reason why there could not be a co-power, with both the board and Ministers equally able to propose, if necessary. What is really important is that the board should have as much—and probably more—power to propose and nominate statistics for inclusion as Ministers themselves.
I thank my hon. Friend for that useful contribution. He has much to offer our debate and I congratulate him on his work with the Treasury Sub-Committee, which looked into the matter and produced a powerful report.
The Financial Secretary has argued—not today, but certainly in the past—that Ministers fired by an enthusiasm for transparency and openness will be falling over themselves to nominate their key departmental figures to be assessed as national statistics and thus voluntarily subject themselves to additional independent and searching scrutiny. The Royal Statistical Society points out that that is simply not borne out by experience over the past six years during which the National Statistics system has been in operation. The RSS states:
“If decisions about scope are left to Ministers… we are likely still to have patchy coverage based on the views of individual Ministers rather than the significance of the information to public debate.”
Ideally, the whole two-tier division should be abolished.
The board’s role should be consistent across the statistics produced by the ONS and by Departments; and the code of practice should apply to all official statistics. At the very least, Ministers should not have the power to veto inclusion of their departmental figures in the National Statistics system. There is no good reason why departmental figures, many of which are absolutely vital in assessing the performance of our public services, should be treated to a lesser regime. We need a regime based on integrity, honesty, objectivity and impartiality. As the British Society for Population Studies has pointed out, there is nothing inherent in social statistics that justifies differential treatment under the Bill. Quite the contrary, they make up the very currency of political debate in this country and the Opposition believe that they should be subject to the same ethical standards as those currently part of the National Statistics system.
The Opposition would also like greater clarity in the Bill on the role of the national statistician. It is important that her remit should explicitly include an obligation to co-ordinate the UK statistical system as a whole, and we need a much clearer split between her functions and those of the board. As drafted, the Bill confuses oversight and delivery functions. It gives the board executive responsibility for the way in which the ONS is run and the statistics that it produces, in addition to its scrutiny function. That will give rise to a conflict of interest and, in the words of the Treasury Committee,
“would be likely to have a negative impact on the board’s perceived independence”.
Under the proposed model, in which the producer of statistics takes over a regulatory role for the system as a whole, the board would be judge and jury in its own case. In media terms, it would be the equivalent of the BBC governors not only regulating the corporation’s output but taking over major Ofcom functions and regulating the most important part of the rest of the broadcast media as well.
The Opposition share the view of the Treasury Committee, the Royal Statistical Society, the Statistics Commission, the Statistics Users Forum and many others that there should be a clear separation between executive and scrutiny functions. The Government have sought to provide for an internal split in the way in which the board performs those two different functions. However, the attempt to establish that internal split does not go far enough to answer the serious concerns that have been expressed during the consultation process.
The Statistics Commission has done valuable work to improve the quality and integrity of statistics in the UK. Indeed, one might be tempted to speculate that the structure of the proposed reforms was motivated in part by the Government’s wish to shut down the Statistics Commission, given its fearless criticism of the Government. The commission’s standing as an impartial and powerful voice in favour of statistical integrity has been strengthened by the fact that it has never been involved in the production of official statistics or in the management of the ONS. There is a good case for ensuring that that separation of functions continues with the new board in charge of scrutiny, and for leaving the executive functions to the national statistician. We will table amendments to that effect.
To strengthen its independence from Ministers, we would like the board to be established as part of Parliament on similar lines to the National Audit Office, reporting to a powerful new committee of both Houses so as to utilise the powerful expertise and knowledge across the two Houses. We would like the board’s resources to be determined by a direct parliamentary vote.
The Office for National Statistics would primarily be run by the national statistician, because she is the person who is best able to deliver executive functions. The board would also look at the operation of the ONS to ensure that it was held to account. The problem with the Government’s proposals is that the board will be given not only the function of running the ONS and being responsible for producing statistics through it, but the responsibility of regulating it. We would like to separate those functions so that the board could regulate the ONS without being responsible for running it. Such a model would be consistent with promises made by the Leader of the House in a speech made as far back as 1995. It would provide the strongest safeguards and independence from ministerial control.
We are also prepared to look at the alternative approach that has been highlighted by several of my colleagues. That proposes that, if residual ministerial responsibilities are to be retained, there is a strong case for those responsibilities to be exercised by the Cabinet Office rather than the Treasury. We do not believe that that would provide safeguards as strong as those that would result from a complete shift to the National Audit Office model, but removing the new structures further from the hegemony of the Treasury would secure more effective independence from Ministers.
On pre-release and release practices, the Opposition believe that Ministers’ pre-release access should be radically curtailed.
I believe that it was in 1989 that the responsibility for statistics was transferred from the Cabinet Office to the Treasury. That caused considerable concern, and I received a letter from the then Prime Minister, Margaret Thatcher, to say that although the Treasury had the greatest vested interest in fiddling the figures, one should respect its integrity. Should not the hon. Lady consider the Bill—which has been described as arguably the most important and radical reforming Bill of this Parliament—with a little more generosity, and with guilt for what happened to national statistics during the dark age between 1979 and 1997?
Clearly, the hon. Gentleman is concerned about the decision back in the ’80s to shift responsibility for the ONS from the Cabinet Office to the Treasury. In that case, I hope that he will vote in favour of amendments to change the Government’s proposal that the Treasury should retain those functions.
I turn to release practices. If the reform is to succeed in building public trust, pre-release rules should be determined by the board, not by politicians. Lax pre-release rules can significantly undermine public trust in statistics by fuelling justifiable concern that Ministers will be able to place a misleading spin on the figures. According to the Statistics Commission, restriction of pre-release access is much more important for restoring trust than making the ONS a non-ministerial department. As former national statistician, Len Cook, put it:
“for as long as pre-release access exists on the scale it now does in the UK, then the release processes of statistics can never be considered impartial”.
Ministers generally receive market-sensitive figures at least 40 hours before publication. They can receive as much as five working days’ notice of other statistics; I am delighted to hear that the Government are contemplating reducing that excessively long period of notice. As Professor Tim Holt, the former head of the Government Statistical Service, pointed out, the UK’s rules in that area,
“give pre-release access to more people, for a longer period and for a much wider range of statistics than in any other advanced country.”
The UK rules are out of line with international best practice and International Monetary Fund standards on data dissemination. Many other countries allow no pre-release at all. In countries that permit it, the notice period is considerably shorter—in Australia and France it is three hours and one hour respectively. In the US, it is 30 minutes, with access restricted to the President.
As we have heard, the problems with pre-release were underlined when the Prime Minister blatantly broke the rules by leaking forthcoming employment figures in his speech to the TUC in September. Mike Haslam, of the British Urban and Regional Information Systems Association, summed up the problem well when he said:
“pre-release access gives Government an unfair advantage in presentation since ‘first with the news, makes the news’”.
Mr. Haslam’s call for an end to all pre-release is echoed by the Royal Statistical Society, the Greater London authority data management and analysis group, the Audit Commission, the British Society for Population Studies and just about everyone who responded to the Government’s consultation.
By specifically excluding pre-release rules from the remit of the new structures, the Government significantly undermine the credibility of the Bill. By seeking to legislate for pre-release access, they are seeking to entrench spin into law. The Opposition will oppose their attempt to do so.
I believe that the independent board should be able to set the rules on pre-release. That may mean that pre-release goes altogether; the decision should be for the board. I certainly believe that there is a very good case for significant restrictions on pre-release. If the board wishes to abolish it altogether, that should be a matter for it to decide.
Has the hon. Lady taken advice from the hon. Member for Sevenoaks (Mr. Fallon) or the hon. Member for Worthing, West (Peter Bottomley), who both held ministerial office for her party? Would they advise that it would be sensible to do away with pre-release altogether?
Order. The one thing that we cannot have is interventions on interventions. If the hon. Lady made at least a modest response to the first intervention, she could then turn to a perhaps more major intervention from the Opposition Benches.
I say clearly that the whole House—Labour, Conservative and Liberal Democrat Members—ought to support the policy put forward by my hon. Friend the Member for Chipping Barnet (Mrs. Villiers). The board should make the recommendation. If the Government want to contradict it, they should do so in the open after the recommendation has been made.
I am grateful to my hon. Friend for that intervention. I am also grateful to the Financial Secretary for giving us a little more insight into his intended proposals for the new rules on pre-release. However, I appeal to him to publish in draft the delegated legislation that he intends to produce under the Bill, setting out the rules in their entirety so that they can be considered in Committee and we can know what the Government intend.
I think that the board should decide. If it chose to make that recommendation I could live with it, but I suspect it is extremely unlikely that an independent board would make such a recommendation.
It is enormously important to get the pre-release issue right if the Bill is genuinely to work and to achieve the Government’s aims, but the board should also be able to make rules on how statistics are released to the general public. I welcome the indication that the Financial Secretary gave about a central hub to release all statistics. It will be necessary to scrutinise the small print in detail to establish what is being contemplated, but it seems that a step is being taken in the right direction.
The issue is crucial. Professor Holt points out that
“press offices within policy departments have the simultaneous task of releasing statistics… and issuing the Minister’s view of the statistics and their policy implications”.
That, he says,
“creates an impossible tension at the heart of the release process.”
Bill McLennan, another former head of the Government Statistical Service and also of the Australian Bureau of Statistics, puts it more bluntly:
“The National Statistician has about as much chance of being able to ensure that political influence is not a factor in the release of statistics… as a snowflake in hell has of not melting.”
There are attractive arguments in favour of requiring all official statistics to be released through a central, independent press office, physically separate from the departments producing the figures.
I appreciate that the hon. Lady may have constructed her speech before the debate, and that she may have missed what I said in my speech, but I did say at some length that the Government were committed in principle to creating just such a central publication hub. She does not really need to go over the ground unless she disagrees with that. If she does not, and if she supports it, perhaps she will welcome it.
The Financial Secretary may have missed the fact that I did welcome his announcement as a step in the right direction—but one that it would be necessary to examine closely in Committee to establish whether it would work effectively. I make no apology for raising the issue and discussing it in some detail, because it is pivotal to making the reform a success.
Although the House may not be packed today, we should not underestimate the critical importance of the task that faces us this afternoon. Professor Sir Denis Pereira Gray rightly describes statistics as
“a uniquely precious resource… they inform Government, academics and society generally about the world in which we all live. They underpin the whole process of democracy”.
The professor tells us that we have
“a once-in-a-lifetime opportunity to safeguard the independence of national statistics”.
I appeal to the House to join the Opposition in seizing that precious opportunity with both hands as we seek to strengthen the Bill and inject some honesty, transparency and public trust into official statistics after a decade of spin, manipulation and dissembling from a discredited Government.
All right hon. and hon. Members have unfinished business. Part 2 is of special interest to me in that context, as I shall explain.
When I was elected to Parliament in 1997, I was appointed honorary patron of the Society of Registration Officers in England and Wales, otherwise known as SORO. I declare that interest before proceeding. I succeeded Joyce Quin, then Member of Parliament for Gateshead, East and Washington, West and now Baroness Quin, to that post when she was appointed Minister of State at the Home Department.
Since my appointment as SORO’s honorary patron, I have been campaigning for the employment rights of registration officers who are statutory officers. Approximately 1,700 registrars and superintendent registrars are affected by part 2 of the Bill. The remainder of the approximately 7,000 employees of the civil registration service are already local authority employees. Statutory officers have no legal employer and therefore do not have employment rights as employees, although they might have some rights as workers under some employment legislation; therefore, in that respect their current position is complex. Today, registration officers are appointed by local authorities, accommodated by local authorities and paid by local authorities, and their pensions are arranged and paid by them as well. Yet when they are unfairly or constructively dismissed, they have no right to apply for a hearing before an employment tribunal. In the past 10 years, at least 18 registrars or superintendent registrars have been dismissed from the civil registration service. The Registrar General alone can dismiss registrars or superintendent registrars, despite their close involvement with local authorities. The Registrar General can hear an appeal, but only if there is new material to consider.
In the previous Session of Parliament I introduced a ten-minute Bill: the Registration Service Bill. It would have changed the status of registration officers who are statutory officers to that of employees of local authorities. SORO, Unison and I have been campaigning for that for more than seven years. My Bill also had the support of the Employers Organisation for Local Government and Local Authorities Coordinators of Regulatory Services—LACORS. There is, however, a difficulty: because registration officers have no legal employer, the Transfer of Undertakings (Protection of Employment) Regulations 2006—TUPE—do not apply to the change of status, so my ten-minute Bill would also have allowed the transfer of employment status while protecting the employment rights of those employees as though TUPE actually applied. I am pleased that the Bill under consideration covers all aspects of that ten-minute Bill, and I thank the Government for listening to SORO, Unison and me, and to others who have been leading the campaign.
My Bill received its First Reading on 23 November 2005, when the late Eric Forth, then Member for Bromley and Chislehurst, questioned its contents, although he did not call for a vote. On several Fridays at the end of 2005 and in the early months of 2006 when private Members’ Bills were before the House, he continued, as ever, to shout, “Object” when I tried to get a Second Reading for the Bill, despite the fact that the usual channels had agreed to allow the Bill to proceed to Committee. I thank the shadow Chancellors of the main Opposition parties and their deputies for agreeing to that. Unfortunately, shortly before Eric Forth’s tragic death, I gave the date for the Second Reading of my Bill as Friday 14 July 2006; it fell, of course.
It is important that the changes in part 2 of the Bill under discussion are adopted because the civil registration service is about to undergo the greatest reform in its history. Most of its statutory officers are afraid that their employment rights are not protected ahead of those changes and that some local authorities might use the reforms ahead to unload staff in the absence of that protection. An “efficiency scrutiny” that was published as long ago as 1985 recommended the change in employment status for registrars and superintendent registrars, and Green and White Papers, published in 1988 and 1990 respectively, contained that proposal, but, sadly, the Marriage Act 1994 did not address the question.
The Government began to consider reform of the civil registration service in 1998, when they published a consultation paper on supporting families. “Registration: Modernising a Vital Service” was published in late 1999 by the General Register Office as a serious consultation document, and it was followed in early 2002 by the White Paper “Civil Registration: Vital Change”. In a further consultation paper, “Civil Registration: Delivering Vital Change” which was published in July 2003, the Treasury decided to consult further on bringing about reform of the civil registration service in England and Wales by using the regulatory reform order process that had been introduced in 2001. I felt that the proposed changes were so major that they should have been discussed on the Floor of the House, and I called for that at business questions and in other ways, but it was not to be. Not surprisingly in my opinion, the Regulatory Reform (Registration of Births and Deaths) (England and Wales) Order 2004, published in December of that year, was rejected in 2005 by the Regulatory Reform Committees of both Houses on the ground that the overall package of proposals was an inappropriate use of the powers of the Regulatory Reform Act 2001. The Regulatory Reform Committee of this House expressed concern
“at the exposure of the Registration Services to the wider pressures of local authority financing which the proposed Order would bring about”.
“We consider that the Government should specifically provide for the consultation and protection of Registration Service Office-holders, as advocated by the Society of Registration Officers and Unison”.
That RRO was the largest to be brought before the Committee to date, with 68 articles and 15 schedules, amending 20 Acts of Parliament. A second RRO was planned, on marriage, but was later dropped. Following two written statements by successive Financial Secretaries to the Treasury—on 1 March and 16 November 2005—and the failure of my Bill in the previous Session of Parliament, we are where we are today. Members will therefore appreciate that this group of employees has been extremely patient and looks forward to the success of the Bill before the House today. Indeed, SORO has evidence that the proposal to change the employment status of registrars and superintendent registrars goes back 60 years.
It is ironic that, because of press criticism of the way in which statistics have been presented—by successive Governments—we are where we are today: delivering, we hope, the employment rights for registration officers for which we have campaigned for so long. In view of the events that I have just described, there should be no objections to part 2 of the Bill becoming law. Registrars and superintendent registrars have duties imposed on them by the Marriage Act 1949, the Births and Deaths Registration Act 1953 and the Registration Service Act 1953, and this Bill allows them to retain those duties. Clause 65 establishes the registrar general for England and Wales as—I like this expression—“a corporation sole”, which separates the rights and liabilities of the post from the office holder.
SORO and I have also proceeded with a parallel route to deal with the employment issues before us today. An opportunity was provided when the White Paper “Fairness at Work” was published in June 1998, which led to the Employment Relations Act 1999. Partly as a result of our lobbying the Department of Trade and Industry at the time, section 23 was inserted into that Act, which allows the Secretary of State for Trade and Industry to make an order, subject to the affirmative resolution procedure, to extend certain employment rights to persons who do not enjoy them. Section 23 was brought into force on 25 October 1999, and the Government issued a consultation document in July 2002. Section 23 was amended by the Employment Relations Act 2004. Office holders—otherwise known as statutory officers—include the clergy, registration officers, police officers, prison officers, trade union officers, club secretaries, company directors and trustees.
The Government’s consultation document on section 23 admits that the position of registration officers in particular is extremely complex. House of Commons Library research paper 06/66, which I recommend to Members, attempts to explain those complexities on pages 90 to 91. The Government have decided that part 2 of the Bill goes further than would be possible if we applied section 23 of the 1999 Act to this problem.
The Office for National Statistics also incorporates the General Register Office for England and Wales, whose functions are to be transferred elsewhere in Government, as we have heard. Although the Treasury is responsible for the GRO, there are several other possibilities, of which I suggest just one: that its functions be transferred to the Department for Communities and Local Government. I am not sure whether the Government are going to allow us to discuss this issue in Committee, but I hope so.
The collection of official statistics in Britain has a long history, dating back to 1066 and the Domesday Book. In the middle ages, the churches began to record church baptisms, marriages and burials. Such record-keeping became compulsory in 1538, but it was not until 1837 that official statistics on births, marriages and deaths were collected centrally, as they still are. Today, the civil registration service has become responsible for the recording of stillbirths, adoptions and civil partnerships registered under the Civil Partnership Act 2004, which came into force in December 2005. It also advises the Home Office on the question of sham marriages.
With the demographic changes that we have seen in recent times, with more mobility of families, not only across the UK but also across the world, and particularly with the advent of modern IT services, it is right and proper that the civil registration service should undergo its first major reform since 1837, and this Bill paves the way for that. The Bill will touch the lives of all our constituents, and I am pleased that we have been able to debate the collection of national statistics and the civil registration service today, ahead of the reforms of those services that are about to occur. I strongly welcome the Bill.
I wish to make three basic points, the first of which is recognition of the importance of this subject. This is a once in a lifetime opportunity. Secondly, I welcome the move to independence. My main concern is that it has taken a long time. I remember being invited to the Treasury by the present High Commissioner for Australia when she held the most junior post at the Treasury, so it was eight or nine years ago. We discussed issues such as the merits of the Mongolian model, and it has taken a long time for the subject to reach the legislative stage.
The argument about the independence of statisticians goes back a long way beyond the present generation of politicians. It was Disraeli who coined the much repeated phrase about
“lies, damned lies and statistics”.
His experience was based on the then Government statistician, whom he described as an imbecile who spent his time constructing libels with which to damage the Government. The problem was that the Liberals appointed the chief statistician. Party political badinage on the subject is therefore long established.
My third basic point is that although I welcome the move to independence, I worry—this is not a party point—about the tone of many of the professional comments from those who have been invited to comment on the Bill, including the Royal Statistical Society; the chairman of the Statistics Commission; Lord Moser, who is the towering figure in British statistics of the last generation; and the Statistics User Forum. All those bodies have broadly welcomed the Bill, but have been very critical of substantial parts of it, some of them damningly so. Bill McLennan, who was head of the Australian system, which has some merits as a model, said that the Bill would set back statistical independence for several generations. That is the most extreme expression of criticism, but it is clear that the professionals are not happy with the Bill as it stands.
I recognise that it is the most extreme criticism, but Bill McLennan has no political axe to grind. I was reassured by the Financial Secretary’s saying that he was willing to listen and to debate the issues, and that the Government are open to amendments. If that is the spirit in which the legislation is considered, here and in the other place, I am sure that we will emerge with improved legislation that will not justify Mr. McLennan’s pessimism.
On my first point, Government statistics are important for different reasons. The first reason is the nature of the debate that we conduct in the political world and the need to ensure that it is consistent and sensible. We have had several examples in recent years of how a lack of confidence in statistics can make that debate very difficult. The most obvious case, which the hon. Member for City of York (Hugh Bayley) mentioned, was concern about the quality of employment figures. The hon. Member for Worthing, West (Peter Bottomley) intervened with a justification, but there is little doubt that there was considerable loss of confidence in employment statistics at that time, and it has continued.
We see another example every Wednesday lunchtime, when Members on one side of the House say that crime is increasing, based on figures in either the household survey or police recorded statistics—whichever shows an increase—while Members on the other side of the House claim that crime is going down, citing figures in the other survey that suggest the opposite to the findings of the first one. One of the most fundamental arguments—whether there are improvements in reducing crime rates—depends on two sets of statistics, which are mutually inconsistent and do not enjoy full confidence.
A more technical point, which is important to the debate and is of particular concern to the Economic Secretary, relates to the whole issue of child poverty, about which there will be much discussion over the next few years. One of the difficulties is that because we are talking about not an absolute but a relative measure, the extent to which progress is made is critically dependent on the methodology statisticians employ to measure it. We need to have absolute confidence in their integrity.
More important even than that is the quality and output of Government spending, with which we shall be preoccupied over the next two years. Over the past few years, there has rightly been growing concern about whether Government spending is productive, which links to the wider debate about resource accounting—something that is not only difficult but could also be subject to abuse.
One example of the difficulties in that area relates to the efficiency of Government spending on education. The ONS, using national statistics, estimates that over the past decade real spending inputs in education increased by about 2 per cent. a year and that outputs increased by 1 per cent. a year. In other words, we are making progress although the system is not enormously productive.
It was suggested that the statistics were not as meaningful as they could be, so they were modified to take account of quality changes, movements in tests and value added, which tended to show that outputs were falling. Department for Education and Skills statisticians then tried another measure, which was to take account of quality changes resulting from the number of pupils passing GCSE at grade C, and concluded that educational output was increasing substantially. Everybody has a different view, but it is interesting that the Department published the last survey, not the other two. That is the sort of problem that arises when there are differences in official and national statistics, and Departments and their Ministers have discretion about which statistics they choose to use.
One sense in which statistics are important relates to political debate; another relates to people’s livelihoods. As has been said, economic statistics have enormous implications for individuals and business. I shall give a few examples—some important and some less so. The argument about inflation statistics was cited early in the debate. We all accept that the move from the retail prices index to the consumer prices index was not political, but was technically driven. It has had enormous implications, however, and there is much frustration that the CPI does not properly capture property price movements, and that it diverges enormously according to which income group is under discussion. If there is to be any change in the measurement of the CPI, or if it is to be augmented by some other measure, which will of course have an impact on pensioners and benefit recipients, we must have absolute confidence that the people responsible for the process can be wholly trusted.
There are public finance examples, such as the degree of debt and Government deficits. At present, they are largely at the level of only public debate, but as the Financial Secretary has pointed out, such things have implications for bond markets. If we were ever to get as close as applying for admission to the economic and monetary union, such factors would determine whether we could be admitted and, if we were part of that system, whether we would be fined for complying with them. Our debates in this place are replicated in arguments in France about France Telecom debt and in Italy about the valuation of Italian gold. Our arguments are not unique. Confidence in the statisticians is vital in that regard.
In discussing the importance of confidence, I shall use a minor and mundane example concerning how I got involved in this debate many years ago and why people working at the coal face of statistics have found the system frustrating. I was asked to work with the World Bank to produce a new approach to trade statistics—the Minister mentioned that we have been doing this for four centuries. We embarked on an exercise—this will really set the hearts fluttering—of reconciling three-digit industry statistics with five-digit trade data.
That enormously exciting subject had considerable practical implications, one of which was that it provided a measure of industrial competitiveness by sector. In addition, it allowed us to compare how open different countries were to manufacturing input and competition—that was why the World Bank encouraged us to do the work—and thus helped to frame the terms of reference of international trade negotiations.
The figures were produced and published by the Department of Trade and Industry and were used greatly, but in the early 1980s, they started to produce rather embarrassing results showing that the rate of market penetration in many industrial sectors was increasing alarmingly, and one day they were suddenly pulled. An enormous investment of the UK Government’s and others’ time was thus wasted, and useful and rich, albeit not terribly high-profile, data were simply abandoned. We thought that that was done for political reasons, although no one ever explained the decision. The Bill is designed to prevent that kind of possible political intervention at a rather low level from interfering with the useful production of data.
On the consensus on independence, I think that we all agree that the statistical service and the chief statistician have to be protected. The underlying reason for doing so—the lack of trust—has been mentioned. The hon. Member for Wolverhampton, South-West (Rob Marris) challenged the hon. Member for Chipping Barnet (Mrs. Villiers) because she had only one set of data. I have two, but they are cross-sections, rather than a time series, so I am not sure whether they entirely prove the point. It is worth citing the Office for National Statistics, which has suggested that only 14 per cent. of the public believe that the Government handle data honestly. A MORI survey provided confirmation of that by indicating that only a third of the public think that official statistics are accurate.
In a sense, the comments of professionals are more important than our views, so I have compiled a few quotes on the Bill from some of the leading people in the field. Before the Bill was published, Lord Moser, who, as I have said, is probably regarded as the leading authority on British statistics, cited the central problem:
“When it comes to reducing trust in official statistics, ministers are the main culprits”.
He welcomed the published Bill, but said that he was surprised “to put it mildly” by the way in which the governance was structured and the Government’s approach to pre-release.
The chief executive of the Statistics Commission commented that the successor body of the ONS would not have “enough authority” to “resist pressure” from Ministers and their advisers. The Statistics Commission has outlined four major areas in which it believes that Bill should be substantially changed. Tim Holt, the president of the Royal Statistical Society, says that the Government have not bitten the bullet on pre-release. I know that the Minister has partially bitten the bullet, and we shall return to that in a moment.
The statistics users forum suggests that there are five major areas of concern about the Bill, and I shall run through what they are, because they have been discussed with varying degrees of thoroughness. The first is what is said to be the limited scope of the statistical board. The Minister has rightly said that its legislative responsibility reaches right across Government. The key phrase that keeps coming back in most of the comments of the professionals is that the statistical board, and the code of practice that it will use, will have responsibility, but not authority. There is an imbalance between the two. There are two specific problems with that, and we discussed one of them at some length on the Floor of the House—it was the idea that Ministers should decide on the distinction between national and official statistics, although that might, in some cases, be a politically sensitive decision. The other point, which has not yet been stressed adequately, is that even if the statistics board judges that, effectively, the code of practice is not being complied with, it has the power to name and shame, but not, as I understand the Bill, the power to make its decisions binding. I hope that the issue of the degree of authority, as opposed to responsibility, will be clarified in Committee.
The second point is on governance, and although it has been dealt with effectively by the Opposition spokesman, the hon. Member for Chipping Barnet, I shall touch on it briefly. The issue is partly one of clarity: the statistics board appears to have both executive and oversight roles, but tucked away in the Bill is the suggestion that a new executive grouping, which will produce the statistics, will be created within the board. It is not entirely clear whether the roles of production and oversight are separated. The example has been cited of the role of the statistics board chairman. He might, under some circumstances, both pass a judgment on the methods used to calculate a particularly sensitive set of figures and, in his other capacity, justify the conclusion. It will need to be absolutely clear that such a conflict of interest will not arise.
The third set of problems relates to pre-release, and the Minister advanced the discussion on that subject this afternoon. I may have misheard him, but I think that he said that the pre-release period will now be 40 hours, although that is not in the published Bill; is that correct?
The period will be 40 hours, so as to be aligned with the provisions for market-sensitive data. That is an improvement, and we acknowledge that the Minister is trying to address some of the criticisms, but it is worth comparing that 40 hours with the situation in other developed countries. In the United States, the time is half an hour; in France it is an hour; and in Australia it is three hours. The industrial country with the longest period is Canada, where it is 17 hours. Even given the Government’s concession, we are far from having a response time that other countries would regard as normal. The Minister made a good, eloquent case for pre-release, and anybody acquainted with government will accept the need for such a provision, but I would argue that the best practice, as demonstrated by most Anglo-Saxon countries, particularly the United States, is to allow a much shorter period.
My final set of points again reflects the comments of the professionals. They are on the way in which the statistics board will be subject to the residual powers of Ministers, and the board’s reporting requirements to Parliament. Those are separate issues, and we will perhaps need to touch on them separately. The residual powers will rest with the Treasury, but I agree with the hon. Member for Chipping Barnet that that is not right. I do not have anything against the Chancellor or the Treasury under this Government, but there are good reasons for not giving the powers to the Treasury. It is a major consumer of statistics, and so has a strong interest in how they are used, and it is also the funding Ministry, so its decisions will determine the effectiveness of the statistics board as a producer of statistics. It seems a better idea for decisions to be made by the Cabinet Office, but we will, no doubt, argue that point in greater detail.
It is certainly true, as the Minister said, that the Bill will create a much greater degree of parliamentary accountability, and there is scope for a good deal of debate about where that parliamentary accountability should lie. As things stand, I imagine that the board would be subject to scrutiny primarily by the Treasury Committee. Although that is an admirable body—I was a member of it for a short time—it deals purely with economic matters, and many of the issues that the statistics board and the chief statistician will be concerned with are non-economic issues. There is a strong argument for creating a system of parliamentary accountability that goes way beyond the Treasury Committee and makes use of the resources of both Houses of Parliament.
With those qualifications, I welcome the move to independence. I particularly welcome the indication that the Minister gave in his opening statement that he will be flexible and will listen. I hope that he will accept that, as the professionals suggest, there is need for substantial amendment.
I welcome the opportunity to contribute to our debate which, everyone recognises, hinges on the important issue of trust in official information. We are self-obsessed in believing that it is the actions of politicians that undermine trust in official information, because the biggest factor in undermining that trust is whether the information is accurate. I welcome clause 7, which makes clear the Bill’s objective of
“promoting and safeguarding…the quality of official statistics”.
It refers not only to impartiality, which we have discussed at great length, but to
“accuracy…relevance, and coherence with other official statistics”.
I want to illustrate that important issue with a local example. I counsel parliamentary colleagues against falling into the trap that the media have dug for us by implying that the only reason why politicians wish to become involved with such things is to spin and fiddle them. I do not believe that that charge can be levelled against most politicians, whatever their party. We all do ourselves a disservice by conspiring in that debate, as it is a big mistake to believe that that is why Governments want to do things with statistics.
Is the hon. Lady honestly saying that Health Ministers do not try to spin figures to suggest that things are better in the health service? Is she saying that the Home Office is not trying to spin criminal statistics to suggest that things are better than they are? People look at the reality on the ground, because their own personal experience does not match politicians’ announcements. That is the problem, and that is the cause of the lack of trust.
The hon. Gentleman is right to say that a lack of trust arises when people’s experience differs from the figures. That is my point. He says that the difference arises only because politicians make up facts, but he is wrong. In fact, in many cases statistics are not accurate, and the most undermining factor for any statistical series arises when it is simply wrong. We need to ensure that the Bill addresses that issue properly.
Does the hon. Lady agree that it is not only the content of statistics but the timing of their release that undermines trust? For instance, a spate of reliable but damaging statistics can be undermined by the fact that they are all released at the same time—just before Parliament goes into recess for Christmas? It is not just the content of the statistics but their timing that undermines the trust of the wider public.
The hon. Lady is doing something that I counselled hon. Members not to do, by assuming that politicians act in that way to bury bad news. I am sure that sometimes they do, but it is not the case on most occasions. Politicians on both sides of the House who conspire in assuming that it is the case most of the time undermine trust in politics. I believe, perhaps naively, that most people in politics, whatever their party, genuinely work for what they believe is the public good, and do not wish to connive in concealing the truth from the public. We are making a mistake when we imply that misrepresentation is widespread—the normal pattern of behaviour. I do not believe that it is.
What most undermines trust in official statistics is questionable accuracy. The Government will always get the blame. Let us take as an example a statistical series that most people do not believe is connived at or spun by Ministers. I refer to the census and the mid-year census statistics, which are more overseen by Parliament than any other statistical series that I can think of.
In August the leader of Slough borough council said:
“By now most people realise that the Government continues to underestimate the population of Slough”.
In his new year message he wrote:
“We...hope that 2007 will be the year in which the Government finally corrects the serious under-funding of Slough...Our population is not falling rapidly, as the Government has maintained.”
He is right to say that our population is not falling rapidly, but he is not right to say that the Government maintain that it is falling rapidly. The way in which the mid-year estimates between censuses work for Slough is just plain wrong.
We are making a mistake in the way in which we conduct the debate if we imply that it is politicians’ behaviour that undermines public confidence. That may happen sometimes, which is why it is right for the Bill to put safeguards in place. Public confidence in statistics is also undermined when parts of the statistics are wrong. For example, the way in which census figures got it wrong for Westminster was raised by that council powerfully in 2001, when there was a massive mismatch between the final count in the census and the council’s mid-year estimates. I was privileged to go with my hon. Friend the Member for Regent's Park and Kensington, North (Ms Buck) to make representations to the Treasury Minister then responsible, because I could see that her point that Westminster had been wrongly treated had some aspects in common with Slough’s case.
Slough at that time had the ninth largest increase in population, according to the 2001 census—unlike Westminster, which was estimated to have had a massive fall in population. Nevertheless, I could see that the diversity of our populations, the churn and so on, meant that the kind of flaws to which Westminster had been subject could also affect the constituency that I represent. I am glad that I did that. The mid-year population estimates for Slough suddenly produced an incomprehensible fall in our population. We had had the ninth largest increase in the country in our population between 1999 and 2001—yet we are told that in the years since 2001, we have had the second biggest fall in population. That is utterly counter-intuitive.
The mid-year estimate formula uses birth rate, which is an accurate national data set. Slough’s percentage growth is greater than the national figure. We have more births, and so more people. The formula also uses death rates, another accurate national data set. Slough’s decline is less than the national figure. We have fewer deaths, and so more people. Furthermore, the formula uses migration, which is where the errors largely arise.
Migration has two components. One is internal migration—within the country—which is based on GP registrations. If one looks at the scatter graph for GP registrations, it is striking that the outliers for accuracy are all places with extremely diverse ethnic populations, such as Luton, Slough, Hackney and Brent. In our town, 17 GPs have closed their books, and we have a walk-in centre, which many members of our population use instead of a GP. We have three times the national proportion of young men, who we know do not tend to register with GPs, and first-time registrations do not count. All these factors mean that in effect, the internal migration figures discriminate against Slough.
It is disappointing to see that in 2003 the population survey note from the ONS suggests that there is no urgent need to change the internal population assessment, but the ONS has recognised that the international migration assessment based on the international passenger survey does need changing. I am glad that that work is under way, and I hope that it might make a difference in the area that I represent, but the changes that it proposes are unlikely to impact quickly. The recent report, published in December last year, suggests that there will not be swift results in any individual locality.
Problems arise when statistical series are wrong, when they conflict with other statistical series and when there is not a sufficiently effective way of remedying errors. I hope that the duties created in clauses 7 and 8 in relation to national statistics will produce a mechanism for a more effective remedy to such problems. I have spoken at length to Ministers about the flaws in the calculation and the impact that that is having on the town that I represent. It will not do. Another thing that will not do is the fact that remedying a statistical series takes so long, while the consequences continue.
It is right that executive action should be separate. The Department for Communities and Local Government says that the funding of local authorities must be based on the best estimate of local population. Everyone in the House would agree. But the speed at which the ONS recognises and remedies the flaws in its system, and the consequences for a town like ours, are problematic. By bringing to the fore the integrity, accuracy and impartiality of national statistics, I hope that the Bill will give us a better way of remedying some of the problems.
Not every local authority can drum up the resources that Westminster council had at its disposal to produce evidence that the statistics on its population were flawed. Slough’s evidence is compelling. The council has even counted the amount of shit that goes through our local sewers, which is considerably greater than it was 10 years ago. [Interruption.] I am sure that was not a parliamentary word. I am sorry.
We must try to ensure that errors in statistics are dealt with. Unless the independence that the Bill rightly provides is combined with transparent and robust ways of remedying errors and a dynamic relationship with people who are affected, we will not get the trust in statistics that the Bill seeks to achieve.
The hon. Gentleman can take it that it was appropriate to use the word in the way that the hon. Lady used it, otherwise I would have intervened.
Order. We have dwelt long enough on one word.
I was making a serious point. When evidence from other sets of data suggests that a statistical series is wrong, there must be a way of remedying the situation. The board will have a duty to ensure the coherence of National Statistics, so when different statistical series conflict with each other, it will have a duty to try to sort out the source of the conflict and ensure that the statistics are accurate. I hope that that will play an important role in improving public confidence in statistics.
Another thing that reduces public confidence in politicians and statistics is when we do not have a solution to an issue that faces the country, which is one reason why I think it right for Governments to have prior sight of certain statistical series. People expect solutions from their Government to some of the problems illustrated by National Statistics. There is a discussion about how long a Government would need, but the issue is important.
I do not want to finish my contribution without saying something about the registration service, which is covered by an important part of the Bill. On 21 December 2006, I had the privilege of attending an event organised by the registrar at Westminster council—I keep talking about Westminster council, although I do not represent the area. On 21 December 2005 I was a witness at the civil partnership of two friends of mine, and Westminster registrar service organised a celebration for all the people who had been able to register their civil partnerships in the first year of the implementation of the provision. The event was moving, and it reminded me that registrars register not only joyous events in people’s lives, but sad events at the end of people’s lives. When I saw the registrar and her associates standing there in black clothing, which they usually wear, I was reminded of what a sensitive, effective and warm service they provide to the people for whom they work. I want to take this opportunity to praise them and to recognise that they are due the important rights that the Bill will offer them.
I hope that the hon. Member for Slough (Fiona Mactaggart) will forgive me if I do not follow her into the byways of funding for Slough.
Hon. Members have been very kind about the Treasury Committee report, for which I am grateful. That report is not our first report: it is part of the scrutiny work that the Treasury Sub-Committee has exercised over the years, including annual hearings into the reports of the ONS and of the Statistics Commission and occasional hearings into one-off issues, such as the classification of Network Rail or the preparations for the census. I recognise that that work is limited, because, as the hon. Member for Twickenham (Dr. Cable) has said, the Treasury Committee has other obligations and probably needs strengthening. It is for the House to decide, as the Financial Secretary has invited it to do, how we can put that scrutiny work on to a more systematic basis. I certainly welcome the thoughts of my hon. Friend the Member for Chipping Barnet (Mrs. Villiers) on how we can deepen and widen the parliamentary scrutiny of statistics.
I welcome today’s Bill, because it is obviously important to put official statistics on to a statutory basis. It has been a long time coming—it has taken nearly 10 years to fulfil the manifesto commitment—but it is welcome for that reason and others. Over that period, statistics have become much more central to the political process. The trend probably started some time before that period, and the situation was intensified when the previous Conservative Government introduced measures such as league tables. However, the situation has been accentuated under this Government, because, as the Government are perfectly entitled to do, they have developed to a fine art the process of targetary. They started with some 600 targets, although there are many fewer now. If the Government determine a target, the public must be able to assess whether that target has been met in a way that is robustly, critically and independently measurable.
Many of the targets have turned out to be rather nebulous, which is probably why some of them have been dropped. In some cases, Ministers have been able to define the extent to which they have met a target in rather nebulous ways. For example, they say, “We are on track to meet the target”, which leaves the public confused whether the Government claim to have met it, to be meeting it or something else.
As has been said, many of the statistics that we bandy around—for example, some hospital waiting times and some crime statistics—are not national statistics. There are also statistics which were official statistics and which have been discontinued. When I was an Opposition Treasury Front Bencher, there was a statistical series that measured the impact of indirect taxation on household income, but it has been discontinued.
As almost all of my hon. Friends have said, the Government have been accused over the years of interfering in statistics, or at least there is the perception that they have interfered in key statistics. That has been especially true in some of the most important areas, such as the operation of the Government’s fiscal rules. It is bad enough that the Chancellor is able to change at will the start and end dates of the economic cycle, which could easily be independently determined by the Bank or the ONS rather than being validated afterwards by the NAO.
Other statistical issues are critical to the way in which those fiscal rules operate. The first issue is the classification of PFI liabilities, which is a familiar subject to those on the Conservative Benches, and it concerns how such liabilities are properly accounted for and measured on the public balance sheets. The Chancellor has stated consistently in the past few years that such liabilities are measured in exactly the same way as they were by the previous Government. However, they are not measured in exactly the same way, and, far more importantly, they are much larger now than they were 15 years ago. We need to know in far more than simply accounting terms whether they are statistical public liabilities that should be treated properly on the balance sheet.
The problem is that some PFI liabilities are classified on balance sheet and some are not. Indeed, some do not seem to be classified altogether—special purpose vehicles are not properly classified in private accounts, let alone in public accounts. The public need to know how it is properly decided which liabilities are classified on public balance sheet and which are not, because the totality of PFI liabilities is, of course, very much greater than it was.
The treatment of Network Rail was so tortuous that we had a special inquiry into it. We discovered that the Auditor General was defining the classification of Network Rail in a different way from the national statistician—one of them said that it was public, while the other said that it was private—and we worked hard on an all-party basis to try to resolve the difference. It is clearly nonsense to argue that an organisation such as Network Rail, which the Government stand behind, somehow has nothing to do with the Secretary of State. That is the kind of issue that the new independent statistics board should be able to settle once and for all, rather than leaving it on the current shifting basis, which involves questions about who appoints the non-executive directors and waiting to see the degree of management control exercised by the Secretary of State. I welcome the new board’s responsibility for making decisions on such issues, which will no longer be left to be disputed between two public officials—the Comptroller and Auditor General and the national statistician—or by a parliamentary Committee.
The crux of the Bill concerns the classification of expenditure as between capital and current. I want to take the House back to the curious events that took place in February 2005, when just six weeks before the end of the financial year some £3.4 billion-worth of roads maintenance was suddenly reclassified as investment rather than current expenditure, thus making a significant difference to the outcome of the Chancellor’s rules. It turned out that that had not been dreamed up by the ONS but came out of work involving the Statistics Commission, which said in a report on one of its investigations:
“issues regarding Highways Agency accounting for roads discussed…at a public service data group meeting on the basis of an HMT paper.”
When I asked the Chancellor in the Treasury Committee who had instigated the work that led to that rather convenient revision, he snapped back at me:
“This is entirely a matter for the statistics authorities. They are totally independent in the matter.”
He went on to say that
“the independence of the Office for National Statistics is clear and obvious.”
Perhaps it is not quite so clear and obvious now, given that Ministers have had to come before the House to introduce
“legislation…to create an independent board to enhance confidence in Government statistics.”
Something has clearly changed in the past couple of years, whereby Ministers have accepted that there is a serious problem with the perception of official and Government statistics—and, to their credit, they are going to do something about it. The key test that I apply to the Bill is whether it will help official statistics to be perceived as fully independent of Ministers.
No, I am not. I am saying that because such decisions have been so muddled and blurred, with the Comptroller and Auditor General saying one thing and the national statistician saying another, with arguments about which PFI liabilities are contingent and which are not, and which should be classified on the balance sheet, and with the process of serendipity whereby revisions are made very late in the financial year while being perceived as being influential on the operation of the fiscal rules, it is all the more important that we tackle head on the question of the perception of Government statistics. Those are not just my allegations—the outside world made them at the time. I could draw the Economic Secretary’s attention to a leader in The Guardian—I do not know if that was a paper he used to write for—that harped on precisely that point as we went into the March 2005 Budget.
I am struggling to see whose judgment the hon. Gentleman is criticising. Is he saying that the national statistician has been making the wrong judgments, or that the National Audit Office has been doing so? As I understand it, he acknowledges that these were not Treasury or Government decisions—that no influence was applied—and is saying that one or other of those two independent individuals and bodies got it wrong. Which one was it?
The Economic Secretary is getting confused. I am not saying that anybody has got anything wrong. The problem for the public and the wider world is that we have three different sources of authority, with the Comptroller and Auditor General saying one thing, the national statistician saying another, and Her Majesty’s Treasury supplying papers to those various bodies and putting its interpretation on the matter. The end result is a fog, and I hope that the new board will clear it up.
No—I think that the Economic Secretary has had a fair crack at this. He, of all people, should be aware of the suspicions that have arisen concerning the various classifications, the accusations that have been bandied around on both sides, and the fundamental problem of perception. I will not give way to him again unless he can explain why the Chancellor said, less than two years ago, that the independence of the ONS was “clear and obvious”, but is now introducing legislation to make it more independent.
We have made it perfectly clear that the ONS was made independent in the framework document and that we are legislating for that. I am confused as to whether the hon. Gentleman thinks that these decisions should be for the NAO or the ONS, and which he believes is making the right decisions. Having a completely independent national statistician would not prevent differences of view between different independent bodies. I am struggling to understand the point that he is making; so far, I am baffled.
I do not want to test the patience of the House, but I will give it one more try. We have the Comptroller and Auditor General, who is an officer of this House, considering an issue and coming up with an answer. We then have the national statistician—funded by the Treasury but an independent office; let us accept that—coming up with a different answer. We then discover that a lot of the work has been done on the basis of a Treasury paper that is supplied to the ONS, or a working group that is convened on the basis of a Treasury paper. My point is fairly obvious—that the outside world is left confused as to where the real source of authority for those decisions lies. If the Economic Secretary will be patient, I am trying to say that the new system will be better—of course it will. He asks me who I think was wrong. The Chancellor was wrong, two years ago, to say that the ONS was already clearly and obviously independent; otherwise, he would not be introducing this Bill to make it more so.
On the surface, the Bill makes it look as though not much has changed. Instead of an office, we will have a non-ministerial department, but Treasury Ministers will still appoint the members of the board. It is welcome that funding is moving on to a quinquennial, rather than a triennial basis, but it will still be allocated by Treasury Ministers. In those two crucial respects, nothing will change.
There will continue to be a code of practice, as now, but the board will not have the power to enforce it—a key weakness of the Bill to which I am sure we will return in Committee.
Only Ministers will be able to propose statistics for inclusion as national statistics. Members on both sides of the House have dwelt on that, and it is right to draw attention to that essential weakness. Of course it is right that the board should ultimately decide what is a national statistic, but equally it, rather than Ministers, should have the power to initiate series for inclusion. Worst of all, it will be for Ministers to continue to control the much abused system of pre-release access.
The Treasury Committee made proposals to strengthen the Bill in each of those respects. First, it recommended that the board’s role be wholly supervisory—I do not understand why Ministers have not accepted that. There is a fatal confusion in the Bill between the board’s duty as a regulator and its role as a statistics producer.
We recommended—I stress that the Committee is an all-party body, with a Labour majority—a fully non-Executive board, to which the national statistician should report. That is all the more important because the Bill sweeps away the Statistics Commission—the one watchdog that we currently have. Somebody, not simply Parliament, needs to supervise directly the system as a whole. I urge Ministers to reconsider the matter.
Secondly, let us consider the appointment of the national statistician. The Financial Secretary generously took many interventions but he could not quite answer mine. The Bill states simply:
“The National Statistician is to be—… appointed by Her Majesty”.
It is not clear whether the appointment will be on the recommendation of the Chancellor, given the Treasury’s residual powers over the non-ministerial Department, or that of the Prime Minister.
It is also unclear whether the new or the next national statistician will have the right of direct access to the Prime Minister, as Claus Moser enjoyed in the late 1960s and 1970s and as, for example, the service chiefs enjoy now. I hope that the Bill will provide for the national statistician to become a big public figure of the order of Chris Woodhead as head of Ofsted, or David, now Lord, Ramsbotham as chief inspector of prisons. I hope that the national statistician will become a widely respected figure in public policy making. I therefore believe that he or she should be appointed by the Prime Minister and have direct access to him on any matters of dispute with other ministerial Departments.
Thirdly, the issue of scope has already been well canvassed by my hon. Friend the Member for Chipping Barnet. It is clear to everybody that it must ultimately be for the board to determine scope. The Financial Secretary conceded that, but did not go on to accept the natural consequence that the inclusion or exclusion of a specific statistical series must be a matter for the board. There should not be an option for Ministers to decide whether to list or delist a series of statistics that turns out to be politically inconvenient.
It is essential for the board to have teeth to tackle non-compliance with the code. Year after year, when the Treasury Committee examines the annual reports, we see what happens when a body has no teeth. The Statistics Commission did its best but, in the end, it could name and shame only when it established breaches of the code. The Financial Secretary described most of the breaches as minor or “inadvertent”. It is curious to note that, when one looks back through Statistics Commission annual reports, the breaches inadvertently occur in the same Departments year after year—the Department of Health, the Home Office, the Department responsible for local government and so on. However, some statistics have been misused for political purposes and ministerial advisers have put a gloss on them.
Fourthly, let us consider pre-release, which has involved some of the more glaring abuses. Forewarned at such length of bad statistics, Ministers have been free—indeed, within their rights—to try to massage their release and cover the data with political topspin or bury the figures with other related announcements. Forewarned of good statistics, Ministers have not hesitated to commit breaches—inadvertently, of course, according to the Financial Secretary. The Prime Minister breached the code by leaking the forthcoming unemployment figures in his address to the annual TUC conference last September. If that was simply an inadvertent breach, perhaps the Financial Secretary will explain why the Cabinet Secretary was sent out to make an official apology for it. The extent of pre-release access is unacceptable. As the hon. Member for Twickenham said, no other country allows it and I believe that it should be cut altogether.
I welcome the Financial Secretary’s announcement of cutting the time allowed for pre-release from five days to 40 hours. However, I urge him to reconsider the 40 hours. In the modern era, when the Government rightly no longer set interest rates, manage the currency—or are no longer able to manage the currency—only a handful of people need to see specific key statistics in advance. They include the Governor of the Bank of England, but others can wait like the rest of us. Ministers should have taken the opportunity to dispense with the pre-release nonsense altogether and not compromised halfway, as they have done.
Indeed, Ministers have, in a way, made pre-release and spin statutory. They have placed it on an official footing and left it to Ministers, not the board, to set the new rules—granted, with parliamentary approval—for pre-release access. The independent board should set the new rules and I believe that it should cut the time for pre-release access.
I want to answer directly the fair question that the hon. Member for City of York (Hugh Bayley) posed about former Ministers’ views on pre-release access. He challenged two of us. Out of 14 members of the Treasury Committee, six were former Ministers. They had no difficulty in recommending a reduction from 40 hours to only three hours, as applies in Australia. The time is even shorter elsewhere. I therefore urge Ministers to reconsider.
Commentators outside the House have made a further point on pre-release. Given that we shall have an independent board, there is a strong case for National Statistics staff to prepare and issue the press release that accompanies the figures, completely free of ministerial or special advisers’ spin. If a Minister wants to add his topspin later, that is a matter for him.
The Queen’s Speech referred to the need
“to enhance confidence in Government statistics.”
National statistics are not only the Government’s statistics. They are more than simply a ministerial crutch or a parliamentary resource. In a proper democracy, statistics are an essential public good. They belong to all of us. After the suspicions of the past few years, we want our statistics back and we want them to be clean. The Bill, strengthened as it needs to be, should be the start, not the end, of that process.
If I were to go into any pub in your constituency, Madam Deputy Speaker, or mine, and start talking about statistics, people’s eyes would glaze over. However, if I talked about the crime rate or how long it takes to get treatment in a hospital, people might well perk up, listen and express views.
This debate is important. Statistics are dry as dust but they are an important tool for helping politicians and others such as the media, pressure groups and business to find their way around our system of governance and make informed decisions. Statistics are therefore rather like a compass. I do not regard a compass as an especially interesting bit of kit—at least, I have not since I was a boy of 10 or 11—but it is a vital tool for enabling ships and aircraft to navigate.
Let me begin by responding to the hon. Member for Sevenoaks (Mr. Fallon), who defended the Treasury Committee’s call for the Government to reduce dramatically the time for pre-releasing statistics. I agree with the Treasury Committee about that. As a former Minister, I knew that I would be required to stand in front of the media to answer questions about statistics released by my Department. It was important for me to have some time to reflect on the figures in advance. I see the hon. Gentleman nodding; he has had the same experience. No one who has been a Minister would want to get rid of the pre-release system altogether. I posed my question to the hon. Member for Chipping Barnet (Mrs. Villiers), because she was postulating the idea that the statistics board might get rid of pre-release altogether. I do not believe that anyone who has been in government would regard that as a sensible idea.
Before I was elected to the House, I made considerable use of Government statistics as a research fellow and lecturer at the university of York and, to some extent, in other jobs that I held as a full-time trade union negotiator. Anyone who uses or has used Government statistics knows that they need to be accurate, timely and free from political influence. Statistics are key indicators of the economic health of the nation and of the Government’s performance not just with respect to economic policy, but in almost any area of public policy.
I had not intended to make party political points in my speech, but the hon. Member for Chipping Barnet has provoked me. She characterised as a timid step the founding of the independent Statistics Commission, which the present Labour Government brought in as a safeguard for the integrity of statistics, and she apparently regards the important reforms in the Bill as inadequate. She wants us to believe that the Conservative Government were straining at the leash in 1997 to bring in reforms and that if only things had not gone wrong for the Conservatives at the election all this would have happened a long time ago. I really do not believe that at all and I welcome the Government’s earlier reforms to increase the independence of the statistical service. I believe that they dealt appropriately with the important need for statistics to be independent.
In March last year the Government published a consultation document about further proposals. Four broad options were put forward. The first was no change and the second was a parliamentary model for a statistical parallel to the National Audit Office. The third was to strengthen the Statistics Commission, which was introduced some years ago, and the fourth was to create a statutory statistics board. The Government were right, in my view, to reject no change and to reject a strengthened non-statutory Statistics Commission. The Bill shows, of course, that they opted for a statutory board.
I have to say, however, that I am not wholly convinced that the case against a statistical service located in and funded by Parliament was effectively made. The case was asserted rather than made. The Government rejected a parliamentary statistical service, in part because of the transitional costs of setting it up, but I do not personally believe that to be a good argument. One could criticise the National Audit Office on grounds of cost, but we would not argue against having the NAO on the grounds that it employs hundreds of accountants, economists and other professional analysts.
The Government state that statistics are a public good, serving a wide range of users—by implication, not just Parliament. Again, one could say the same about the audit of public expenditure and the public policy advice that flows from it. The Government argue that Britain has a long history of decentralised statistics and that those collecting the data on which those statistics are based are situated in many Government Departments. That is certainly the case, but it is right to have those people collecting the data on a departmental basis as departmental civil servants in the same way that it is right to have accountants in Government Departments to monitor the Government’s expenditure. We nevertheless think it right for Parliament to have its own team of accountants to audit the work of civil service in-house teams.
The Government’s final argument against having a parliamentary statistical office is that the loss of civil servant status by staff would put at risk the movement of qualified statisticians and professional staff between the various branches of a service—in other words, between those working within the civil service and those working for the parliamentary watchdog. That would be the case only if there were restrictive employment practices, so it is not necessarily the case. I am not convinced that a parliamentary statistical office or service would be wrong, but I accept that the Government and the Treasury Sub-Committee, chaired by the hon. Member for Sevenoaks, have decided that accountability to Parliament could be better provided in other ways. Let us look at those other ways.
In response to views expressed on its consultation document, the Treasury said:
“The Government expects Parliament to play the central role in holding the statistical system to account”.
In its fine report on independence for statistics, the Treasury Select Committee said:
“We expect that the House will consider what form select committee scrutiny of the new independent statistics office should take at an early stage of the legislative process.”
We are now at an early stage of the legislative process, so now is the time for the House to discuss how we want our Select Committees to exercise their scrutiny. The Treasury Select Committee took the view that it should continue to take the lead role, provided that Treasury Ministers continue to have residual responsibility for the independent statistical service. Of course, the Treasury Select Committee should retain the right to inquire into any matter for which the Treasury is responsible. However, a new non-ministerial Government Department is being created, so I would like to argue that a new statistics Select Committee should be established.
The Treasury Committee’s report on independence for statistics was an excellent piece of work, for which I commend the Chairman of the Sub-Committee and its members. The Sub-Committee regularly takes evidence from the national statistician and, as the hon. Member for Sevenoaks explained a few moments ago, it has produced other reports on national statistics and other Government statistics from time to time. However, I do not believe that the Treasury Committee, or even the Sub-Committee which is responsible for a wide range of delegated Treasury responsibilities, will provide the level of detailed scrutiny of Government statistics that is needed. If we really believe that Select Committees should be tools that enable us to hold the Government and public policy to account, a case can be made for creating a Select Committee that will produce not one fine report a year on the Government’s statistics service—or have only one annual session, grilling the national statistician—but perhaps six or eight reports a year on different aspects of the service, how it operates, the scope of the statistics, the timing of their release and so forth. That would be possible if we had a Select Committee dedicated to that purpose.
Claus Moser has been cited on many occasions in this debate, which is not surprising as he is the towering figure in British statistics in the post-war period. When I studied statistics at university, more years ago than I care to remember, his was the text book that I used. In his evidence to the Treasury Sub-Committee, he expressed concern about how Parliament would deal with a new non-ministerial Department. He argued that the statistics system covers more than just economic statistics—a point also made by the hon. Member for Twickenham (Dr. Cable), speaking for the Liberal Democrats—and concluded that Select Committees other than purely economic Committees in the Commons and the Lords would need to be involved. That suggests to me that he is arguing for a Commons Select Committee on statistics or possibly for a Joint Committee of both Houses of Parliament, along the lines of the Joint Committee on Human Rights, for instance, as some other hon. Members have also suggested.
It is not for a Treasury Minister to determine how Parliament decides to scrutinise the Executive; that is a matter for the House. I therefore ask my hon. Friend the Financial Secretary to refer my remarks and those of other hon. Members on the scrutiny of a non-ministerial Government statistics Department to the Leader of the House, and to ask the Leader of the House to reply to me in writing.
The intentions that underlie the Bill have been welcomed by hon. Members on both sides of the House as well as by various groups representing producers and users of statistics. While the intentions are clear, however, the delivery is muddled and, as we are dealing with statistics, we should remember that if there is a 50:50 chance that something can go wrong, nine times out of 10 it will.
The weaknesses in the Bill are such that little will change and some of the uncertainty that it introduces will do more harm than good. Although the short title deals with the independence of statistics, the Bill must also guarantee sufficient scrutiny if the reality of that independence is to be realised. The two strands of independence and scrutiny give rise to a third: that of public confidence, which is the real purpose of the Bill, as my hon. Friend the Member for Sevenoaks (Mr. Fallon) pointed out. Lord Moser told me when questioned about the structure and powers of the independent board during the Treasury Committee inquiry that
“if one needs one word, it is ‘scrutiny’”.
The hon. Member for City of York (Hugh Bayley) also made that point.
We have all heard the results of the study recently conducted into falling levels of public confidence in statistics, but those not wishing to use statistics to prove the lack of public confidence in statisticians need look no further than the number of jokes made at their expense. Alternatively, they could ask the national statistician, who was quoted on Friday as saying:
“People often ask why the national inflation figures, which we publish every month, do not seem to correspond with their own experience.”
That was the point that I was trying to make to the Financial Secretary. The example that I gave was that we have the Bank of England basing interest rate decisions on a consumer prices index inflation rate of 2.7 per cent., while the reality for some people, especially pensioners, is an inflation index almost as high as 9 per cent. Is it really surprising that trust is undermined when personal experience seems to bear no relation to official figures? An ONS spokesman said recently:
“The CPI and RPI are specifically not intended to measure what people often refer to as ‘the cost of living’.”
That reasoning is not good enough, because it suggests that the real point of statistics is not to give the public the information that they want but simply to produce the lowest possible number on which to base policy decisions.
Public confidence stems from clarity and simplicity. Form must follow function in our national statistical architecture, not vice versa. But the form is not just window-dressing. The best impartial statistics in the world are useless if they are not generally believed. The difficulty of the system proposed in the Bill is that it is neither clear nor simple, and its products will be no more likely to be believed by the public than those that are in place at present.
My first point is that decentralisation of the kind preserved in the Bill does nothing to encourage public confidence in statistics produced by the Government Statistical Service, particularly those not designated as national statistics. As the Committee’s inquiry found recently, the public are unlikely to distinguish between different sources of data and the varying standards that apply to each. The scattered delivery of statistics by heads of profession who are based within Government Departments may indeed deliver advantages by placing the statistician closer to users, suppliers and policy makers while sharing expertise across Government, but the question remains over who the user of statistics really is: the Government, the public or both?
The statisticians of the Government Statistical Service are consistently double-hatted, because they prepare statistics for public consumption and provide the data which inform and monitor the policy of their parent Departments. The Royal Statistical Society is fairly damning about that confusion of roles—it represents a prima facie conflict of interest. As ever, no one can serve two masters. Even if the decentralised structure of UK statistics is to be preserved—the Committee heard strong arguments that it should be—the Bill needs clearly to address that conflict. If it does not, it will in every sense be a missed opportunity.
Central release of statistics by a single body is one option with compelling advantages for encouraging public trust. It would remove the temptation to use the same departmental officials both to prepare data sets for public consumption and to become involved in their subsequent use by the Departments from which they originated. The Government suggested in their response to the Committee’s recommendation in this area that
“all statisticians in Government will have a line of professional accountability to the National Statistician.”
Not only is that responsibility absent from the Bill, but the reasoning behind it is circular—or perhaps just optimistic—because it merely returns us to the problems implicit in statisticians serving two masters. What happens in the event of a conflict between a civil servant’s professional duty to the national statistician and political duty to his or her Department? I find it hard to believe that statisticians themselves will be content with such a potentially duplicitous situation. Does the Minister really have confidence that statisticians will withstand pressure from their immediate superiors in favour of a duty owed to a physically and professionally remote national statistician? Perhaps the code of practice to be developed under clause 10 will have something to say on that point, but we should not have to wait and see.
Of course, many professionals, including statisticians, are quite used to the idea of reconciling conflicts of interest, and Chinese walls are common in these circumstances. Statisticians have highly organised minds, and they are presumably quite competent in keeping their various responsibilities separate. In recent years, however, the trend has been towards formalising the procedures needed to avoid conflicts of interest, through legislation if necessary. That idea was particularly apparent in the United States in the context of the Sarbanes-Oxley Act.
That is exactly what this Bill is meant to do. We are adding legislative weight to the gradual accretion of safeguards that are intended to guarantee the independence of statistics. The Bill ought to be explicit about how statisticians at the Government Statistical Service are expected to resolve a conflict of interest between professional standards and political expectations. If the Bill does not address such a central conflict of interest, that cannot help but damage public confidence. The public do not want another opaque code of practice or informal Chinese wall. They want, and the Bill must deliver, a simple and transparent division of responsibility and accountability.
My second point is that the Bill must not become a triumph of form over substance by neglecting to provide an inclusive definition of what constitutes national statistics. Not enough has been done to address the false dichotomy between designated national statistics and other official statistics. The Government’s consultation response was adamant, if slightly unctuous, about the public’s ownership of statistics, saying twice that statistics “are a public good”. If that is the case, the public’s ownership is still heavily mortgaged to the good will of Ministers.
The Phillis review affirmed the principle that
“statistics about crime, or the performance of the police, schools, hospitals and the like, belong in essence to the public, not to government or the party in government.”
However, the Government’s response to the Committee’s concerns affirmed that
“It will be a matter for Ministers…to propose statistics for assessment by the new Board”,
and that idea is central to the Bill. By keeping any statistics that are not “national statistics” outside the purview of the proposed code of practice, the Bill invites Ministers to ensure that their statistical output remains under their control and is subject to less stringent auditing.
It is no accident that the statistics in which the public are most interested—those on health, education and crime—are not national statistics. As we heard earlier, maintaining the existing anomalies of classification does little to encourage public faith in the system. There must be a resolution to issues such as the presentation of quarterly hospital waiting lists, but not monthly waiting lists, as national statistics.
I am also concerned about the absence of the customary “carrot and stick” inducements that might encourage Ministers to ensure that their outputs are designated as national statistics. The vain hope that Ministers will want their statistics to be awarded a quality kitemark is wishful thinking; I suspect that pigs will fly before Ministers scramble to fly their kitemarks. We need to examine methods of inducement or compulsion.
The Committee was very clear that the Government were in danger of formalising a two-tier structure with their proposals and were missing an opportunity to consolidate and simplify the existing system. We must be more rigorous about divorcing the admitted benefits of decentralisation from damage to public confidence done by ministerial control over outputs. I hope to return to that issue in Committee.
My third point is that in addition to a marked lack of certainty about delivery and content, the Bill introduces some very worrying confusion about the role of the national statistician. I am grateful that the Government responded to the Committee’s concerns about the national statistician's title, but in many ways that was the Committee’s least significant concern because it dealt with form, not function.
It seems strange that the formal separation of the executive and oversight functions is still lacking in the Bill, given that elsewhere the Government are pursuing the doctrine of the separation of powers with all the fervour of a recent convert to the gospel according to Montesquieu. Much like the staff of the Government Statistical Service, the national statistician is expected to wear more than one hat—as chief executive of the board, head of the Government Statistical Service and chief adviser to the Government on statistical matters.
However, the board’s responsibility for both its own statistical output and oversight of the national statistician’s work is more problematic, which was a point made earlier. The conflation of executive functions and a role in scrutiny is a recipe for uncertainty and it is not clear how the new arrangements will improve existing oversight. At the same time, the abolition of the Statistics Commission will do little to bolster public faith in the system. The Bill has another spasm of optimism about the national statistician’s advisory role by imputing to Ministers a willingness to listen to advice rather than recognising the occasional need to compel them or—in extremis—to remove decisions on statistics from them altogether. In short, the national statistician must not be toothless.
My final point is that the ambiguous place of scrutiny in the Bill raises concerns about the residual involvement of Ministers in the operation of the board. The announcement of the board as a non-ministerial Department has made a positive splash, but if Ministers can continue to play the part of eminence grise with impunity, it remains a sop to independence. That will be of particular concern if the board remains under the auspices of the Treasury, which is the largest single producer-cum-consumer of statistics; many whiffs of Government interference in statistics occur in connection with it.
A suspicious person needs to look no further than the movement of the “golden rule” goalposts, about which we heard earlier from my hon. Friend the Member for Sevenoaks, or the scrap between the ONS and the NAO about whether to classify Network Rail’s debt as off-balance sheet. As a suspicious person myself, I have recently drawn attention to the slow drip of more than £11 billion of private finance initiative debt on to the Government’s balance sheet in the past 18 months as a result of ONS reclassification. Perhaps my hon. Friend was being diplomatic; I shall not be as diplomatic with the Economic Secretary—although I notice that he is not in his place. Did the Treasury exercise some restraint over the ONS in those belated decisions? If so, how much similar debt still awaits reclassification? We do not want to have to ask such questions of a new board.
The Bill also proposes that the Chancellor should relinquish control of the retail prices index, and I think that everyone agrees that that is well overdue. However, clause 19 provides a caveat to protect bondholders from fundamental changes to the RPI. That is rather like the Chancellor ceding control of interest rates to the Bank of England except in cases when, for example, a change would adversely affect mortgage lenders—a rather pointless gesture. In any event, the proposal is not likely to convince the public that the Chancellor does not retain the whip hand; again, the issue becomes one of public confidence. At the very least, we need to look again at whether a transfer of residual responsibility should not, after all, be made from the Treasury to the Cabinet Office, as was suggested by the Royal Statistical Society. Perhaps that would be “back to the future”.
To conclude, the Bill is as much a test of perceived as of real independence. As it stands, the Bill fails to clear the former hurdle before even getting started on the latter. The nuts and bolts will become a matter for debate in Committee, but I am concerned that Ministers are not sufficiently sensitive to the need for the public to have total faith in the Government’s commitment to both independence and oversight. If the Bill is not unequivocal about encouraging public trust, there is no point in getting started on the detail. I look forward to a reiteration of that commitment in the Minister’s reply.
I disagree absolutely with the final remark made by the hon. Member for Braintree (Mr. Newmark). If we start the process by saying that the only important outcome is the public’s trust in statistics, and that if we do not achieve that we will have failed, we will have started on the wrong journey in the first place. Although public trust in statistics is a desirable outcome, it would be wrong to see it as the only outcome. That would be too heavy a burden for us to place on the shoulders of statisticians.
Some of my best friends are statisticians, although I have never been one. We could, perhaps, compare their popularity with that of politicians and journalists. I hope that at the end of this process they become slightly more popular. Politicians may not, of course, and I will say nothing at all about journalists. In any event, it would be unreasonable of us to expect statisticians to take on such a burden for the sake of our popularity, and it would not be fair to judge the Bill on that basis either.
What the Bill could achieve, if dealt with properly, is the separation of politics and statistics. That would give the public more confidence in judging where things may have gone wrong.
I would agree with that if I believed that what people considered to be wrong was political interference, and political interference alone. I do not think that people will feel much more confident in statistics afterwards than they did before. People perceive that there is political interference, and perception is reality. Independence from Government is often worth achieving for its own sake, because it is a public good in any event, notwithstanding public view. If we believe in decentralisation, it is a public good. That part of the debate can exist in its own right. It is not necessary to argue about whether politicians are good or bad, or about whether we should interfere in statistics.
My experience is not very great; but whatever my distance from Government, I have watched Ministers do their job, and I have never witnessed any interference or seen any Ministers wanting to interfere. Perhaps that is due simply to the fact that I work with people of high integrity. Perhaps I am lucky in that respect. I have also worked, as a civil servant, with civil servants of high integrity. I believe with my whole heart that they are worthy of high esteem. I trust them completely, and do not believe that they commit, or want to commit, improper deeds. I am certain that they would not want to do the wrong thing.
I do not know of many people who start their working day by asking themselves “How can I do the public down today?” Most people do not go about their business in that way. Some do, of course. If there were not such people in the world, there would be no criminality. Most people, however, begin their day just wanting to do a good day’s work, and we should trust them. That is most people doing most work, and it includes us.
There is, however, another purpose to what we are doing. When we produce figures, they must be right, but not every provision in the Bill travels in that direction. There are other things that we could do to ensure that figures are right, and they need not be in the purview of Parliament. They could be dealt with in codes of practice that are not only the property of the civil service or the Office for National Statistics—or the Statistics Board, as it will become. There are other professional bodies with an interest in statisticians and in whether their professional integrity is working well.
We should be asking what statistics can and cannot do. We act as if we should shoot the messenger all the time and as if the statistics themselves were to blame, which they are not. The figures are not the problem. What we should be thinking about is how maturely we deal with the information contained in them.
We have heard some interesting comments today about what we should do when presented with figures, and how we should analyse them. We are always using the national crime statistics, for example. One aspect of those statistics—which is not really very complicated, but tends to confuse us—is the question of whether overall crime is increasing or decreasing. Generally, people just want to know whether they are a little bit safer or a little bit worse off. Can they feel safer or less safe, living where they do? It is not usually necessary for people to look at the national crime statistics to know whether they should feel safer in the town or village where they live. They can look around them and decide for themselves.
People see reports on television, and politicians arguing among themselves. Someone will say, “But knife crime is up”, and it will be true. We must be strong and secure enough to say that it is true, and that must inform public debate on public policy and what we should do about knife crime. Accepting that knife crime is up, however, does not mean accepting that more young people are carrying knives and using them. It does not mean that crime in general is on the increase. We must be able to accept that that one crime is going in the wrong direction, while other things are getting better. We must be mature enough to say, “But burglary is down, and car theft is down. Those things are going in the right direction.” Those are the sets of figures, and we must be mature enough to accept them in the round. We should not say, “You are massaging the figures, because you are not accepting this aspect of violent crime.” We should not be having an artificial debate about which is the true figure, when the truth is that one aspect of crime is going in the wrong direction and another is going in the right direction.
The issue of public confidence comes down to how politicians manipulate the statistics that they are given. The hon. Lady is right in saying that if knife crime is on the increase, Ministers should be honest enough to say, “Knife crime is on the increase, but break-ins are in decline.” They should give all the figures in context. The problem lies in the fact that politicians tend to give the most favourable figure rather than showing the true picture.
If that were true I would think it was the problem, but the figures are published in their entirety. If it were true that only the burglary figures were published, that would be a problem. If Ministers came to the House and said, “We are keeping knife crime a secret from you”, that would be a real problem—but they do not. There may be a debate about Ministers’ response—about whether a knife amnesty was the correct response, for instance. It is right for Parliament to debate such matters, but it is not true that Ministers should not respond to a change in the number of people carrying knives.
It would be bizarre if Parliament did not have a view on whether Ministers’ response to knife crime was the right one, but it would be odd indeed to suggest that Ministers should not come to the House with a view on knife crime. It would be immature of the House not to be able to handle the fact that there has been a change in the incidence of knife crime. That is a simple fact. There is a difference between the fact that there have been statistical changes in crime, going in different directions, and—if the statistics have been published, as they have been—the issue of whether Ministers have responded correctly.
This may be the hon. Lady’s interpretation of the argument that we are actually having about Ministers’ having information too far in advance. If I quote a headline to her—
“Many Londoners believe Muslims get more than a fair deal”
—does she understand from it that 77 per cent. of those surveyed did not agree, and that 23 per cent. were described as “many”? That is the kind of misleading start to information that stops people reading the figures, and allows Ministers to get away with what they should not get away with. It is an argument for figures being announced first and then Ministers trying to put a spin on them, rather than the other way around.
The hon. Gentleman has made an important point, with which I was about to deal. It involves complexity, and questions that are often asked. It is wrong to talk of statistics as though they were produced in a value-free way. The question that is posed in the first place is often the real problem—the crux of the matter. The question that is posed, and from which the statistician then analyses the results, is the question, rather than the information that comes out of that.
I have been looking at a set of figures on how we can trust statistics, and it was difficult to understand. I will not bore Members by explaining why it was difficult, as it would take an hour for me to analyse that set of statistics about statistics, but it is broken down in several ways that are relevant to the question that the hon. Gentleman posed about what people might or might not believe is preferential treatment for a particular ethnic or religious group. If questions are asked in a particular way—a way that has a sliding scale—complexity is introduced. In the current case, that complexity is about whether one comes to an issue with a preconception about statistics. There is then also a question about trust and then, added into that, questions about one’s age, political opinions, background, where one lives and one’s other interests. Therefore, all the issues surrounding a question become increasingly complex.
Unsurprisingly, at the end of that process, whether a Minister has had sight of such information in advance almost becomes immaterial, because the information coming out of it is almost impenetrable to the average person. If we look at a graph that is as simplified as possible, it can still be very difficult accurately to discern what we are meant to understand from a set of figures.
Let us look again at the question about whether people think that a disproportionate amount of resources is spent on a particular ethnic or religious group in some part of London, and whether they think that that is fair. It is sometimes difficult to understand whether the question was fairly put, whether the nature of the resources spent is properly understood by the participants in the survey, and whether the Minister who asked the questions in the first place knew exactly what questions were being posed. Whether the Minister knew the answers before they were published is another question entirely. In any event, under this Bill, none of those questions would produce figures that would be national statistics for the board.
The hon. Lady says that, in respect of a complex set of data, it does not matter that the Minister has 40 hours to go through that, but in fact that gives the Minister a huge advantage because they can then pick the most eye-catching part of, or way of presenting, that data, and the easiest way of steering the media in one direction—and the media have deadlines to meet. It can then take ages for everyone else to get into the detail of the data, with the Minister having had the unfair advantage of a 40-hour head start.
I am sure that the hon. Gentleman will intervene on me if what I say is incorrect, but he seems to be suggesting that Ministers should not have early sight of data. This was not going to be the subject of my speech, but let me say that I do not know of any European country where Ministers do not have early sight of data. There are good reasons why Ministers would want to see at least some data before publication. Having commissioned data, it would be bizarre if they were unable to have sight of that before anyone else—if only to be able to think, “My goodness, the policy we were proposing has gone badly wrong.” If things had been got badly wrong, we would like to think that the Minister concerned would at least want to be able to apologise to the House about that—or if things were a terrific success, to be able to claim credit, or to say something else if the result were somewhere in between those extremes. It would usually be right for Ministers to be able to make some sense of any figures they might have had a sight of before presenting the figures to the House. I do not find that at all bizarre. That has been the practice in our political system not only over decades, but over the many years since statistics were first collected.
The most-used phrase about statistics was coined long ago, back in the age of Disraeli, so it is clear that the relationship between politicians and statistics goes back a long time. It would not be fair to suggest that it started in 1997, or even in 1979. We should try to get away from the question of whether Ministers can somehow massage figures in the 40 hours or five days or however long they might have. I do not think that that is the case.
I want statistics to inform public policy. That is the key. That is what statistics should be used for. I see that the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) is frowning, but that is what they should be used for. Some years ago, I was a councillor serving on Sheffield city council and I remember feeling completely nonplussed when I saw better financial settlements being secured for areas in the south-east that seemed to me to be extremely wealthy compared with the ward that I represented, which was the sixth most deprived ward in England. I could not understand how any economic indicator could result in some such wards getting more money than the one that I represented in Sheffield. That did not make any sense at all.
That brings me back to earlier remarks on how we determine that kind of policy. We have made changes, but it might be asked whether they were fair or based on accurate data, and whether the collation of data was properly conducted. That is what we need to get to the heart of—the proper process. Because there is a perception of interference, politicians want to defend their own constituency interests, which is right and understandable. The accusation is therefore made that, “You’re only making this change for political reasons, because you’re northerners representing northern Labour seats and you want to take the money away from the south-east because that’s where you think us Tories—or members and supporters of whichever other party—are. You’re doing this for political reasons.” Therefore, we must have true and proper data, so that not only is the right thing done but it can be demonstrated that the right decision has been made for the right reasons.
Yet what have we heard about in the debate? My hon. Friend the Member for Slough (Fiona Mactaggart) made some telling points, even about as simple a question as how we can know who lives where they say they live and how many people live in a particular town. It might be said, “Well, we’ll count the number of people who live there”, and that sounds easy to do, but it turns out to be very complicated. We cannot possibly think that Ministers try to interfere in how many people live in a particular house on a particular day, but it turns out that even that is a complex question. Therefore, although I, along with all Members present, welcome the Bill and want it to progress, I also want the Government to go further—if not in this Bill, then later—because more can be done to make statistics more accurate and dependable. That should not be done just to remove the perception of political interference; there is more to this point than that.
We need to look not only at the guidance for use of statistics or the acceptance of statistics, but also at the national guidance for statisticians and the integrity of statisticians. I cast no aspersions on statisticians in saying that. When I was a civil service research officer, we worked in teams, and I believe that that practice has been developed in the time since I left the civil service. I asked some questions earlier about interdisciplinary teamwork, and it is important that teams work together—that they collect data together in an interdisciplinary way, and properly research what is happening so that we understand what people are doing in their lives and make policy decisions based on what people really do, rather than on a snapshot view on one day when we do a simple head count. That is not enough to know how people are experiencing their lives.
Earlier in the debate, a Member talked about understanding deprivation, and he seemed to have already made a judgment about what he thought might be an underlying cause—the breakdown of family life. That judgment seemed to be based on the kind of feeling that we all sometimes have: we feel that crime or family life might be better or worse. Sometimes, however, we have actual data, and sometimes those data are counter-intuitive, so we say the data must be wrong, because they go against our gut-instinct. However, it is not wrong just because it goes against our gut instinct. Such data cannot be a snapshot on one day; they have to extend across a period of time. A proper study of family life would have to extend over at least a decade; indeed, we would have to follow families over decades to see what actually happens to them, and have proper cohort groups. We would need to work across Government Departments, and we would probably have to involve other, non-governmental agencies. The statistician’s work would have to inform at the outset how such a study should be set up, and other researchers, such as economists and social scientists, would have to be involved.
We should not examine just a single moment in time at which we thought we knew what was happening. We should not undertake a simple count, saying, “Last year, x number of marriages broke down, y number of people got married and z number got divorced”, without looking at whether the marriage rate or the divorce rate had gone up over the previous decade. We must examine the whole context to see whether children were thriving in spite of, or because of, divorce, or whether family counselling had an impact on family life.
Given that perception is often regarded as reality, the independence of the board and all the other elements in the Bill will go some way toward building trust and might have some impact on public confidence. However, if the statistician’s work is to be meaningful and really to inform public debate on policy, I hope that we will at some stage go further and examine how the statistician can inform policy in a more meaningful way inside Departments. I also hope that the role of the statistics board in examining the standard of the statistician’s work will assist Departments in informing public policy.
The hon. Member for Colne Valley (Kali Mountford) seems to have a touching faith in the integrity of statistics and of Ministers, who never spin at all. The difficulty that I have arises from a letter that the then Tory Secretary of State, Ian Lang, wrote to the then Prime Minister in 1992, when the general expenditure revenue Scotland statistics, which I shall refer to later, were being developed. The then Secretary of State said that he judged that it was just what was needed at present in the Tory campaign to maintain the initiative and undermine the other parties, and that it could score against all of them. GERS was designed to be a political tool, not to offer an enlightened or accurate description of the Scottish economy. I suppose that the great shame—this is the last political point that I shall make in this speech—is that the Labour party continues to use GERS to this day for exactly the same purpose as the Tories did in 1992.
However, I give a broad welcome to the Bill and to some of the Financial Secretary’s opening comments. I particularly welcome what was said about pre-release access, which is to be put on a statutory basis, but I shall listen carefully to the argument that the board may wish to set the rules regarding such access. I remain concerned that the 40-hour period is far too long. The idea that a Minister and his team cannot in 40 hours find one little nugget to spin or one bit of obfuscation to hide a bad bit of news is clearly wrong.
I also welcome the announced creation of a publication hub to separate the communication of statistics from political comment on them. If the Government hold to that, it will make an enormous difference in terms of the public perception of statistics and the way in which they are launched. Too often reports are leaked in advance, or the political comment on them immediately thereafter is given a particular spin. As was said earlier, by the time that the journalists and the rest of us have got into the guts of the statistics, the story has gone and a perception has been left.
However, in general terms and for the sake of good policy making, it is important that statistics are produced and delivered in an independent and impartial manner; fundamentally, that is what statistics are about. In the case of Scotland in particular, it is time for the figures that tell us so much about the success or otherwise of policy to move outwith the control of Ministers. Of course, we ultimately wish to see an independent Scottish statistics board, but we very much welcome the move that the Government have made through the Bill. Our primary concern is the future structure of statistics: we want adequate, independent and entirely impartial statistical information, which presents a true picture of Scotland at all times, to be available. All such statistics are essential in developing and measuring policy, in assessing need, in measuring the economy and in almost every other Government and local government decision-making process.
Furthermore it is vital that the public, media, voluntary organisations and society as a whole have access to independent impartial statistics in which they can have complete trust. Independence is essential to ensure that there can be no implication of manipulation, selectivity or politicisation in the production, publication and dissemination of statistics at any point in the future—which brings me nicely back to GERS, because that was its sole purpose.
We have heard from many people that public trust in statistics is low—they had their own different reasons for saying so—and that some publications, including GERS, have been heavily politicised. I have no doubt that the independent board proposed in the Bill would have given short shrift to the Tory attempt, and the subsequent Labour attempts, to use partial and incomplete figures to make a narrow political case. I want to see the removal of any suspicion from our statistics, and to go further by guaranteeing that they are based on real evidence. We must therefore make certain that the Bill as drafted really is sufficient to deliver confidence in the statistics published.
I shall use the GERS paper as an example of the difficulties that we face and of the problems that must be overcome. GERS is supposed to be a snapshot of the Scottish economy two years in arrears. It is supposed to look at total income and total expenditure and work out the balance sheet for Scotland—and I shall quote from it to show just how inaccurate the process is. The net borrowing figure—the deficit included—in GERS is based on expenditure and receipts calculations that by necessity include some estimation. GERS says:
“It should therefore be used with some caution”.
It fails to include a single penny piece of revenue yield from the Scottish sector of the North sea. It is a wholly misleading figure.
On income tax, GERS uses the survey of personal income, yet for the 2004-05 statistics it used the 2003-04 survey of personal income data, because the 2004-05 data were not available. Nor is the calculation based on a known and fixed taxpayer population, so it is wrong in two regards.
On VAT, Scotland’s share of UK VAT revenue was estimated on the basis of Scotland’s share of household expenditure on goods and services subject to VAT, as estimated from the expenditure and food survey. GERS describes this in the following manner:
“The results should be treated with caution since they are based only on household expenditure estimates and not the share relating to the amount of VAT received from businesses registered with Scottish VAT offices or received from businesses trading within Scotland.”
The landfill tax has been allocated on a population share basis. The environmental data indicate that Scotland has more landfill per head than the rest of the UK, yet no geographical breakdown of the tax data is available. Again, this method may underestimate the revenue yield from that tax for Scotland.
On corporation tax, GERS says:
“This tax is exceptionally difficult to estimate for Scotland, due to both conceptual difficulties and a lack of data, therefore, the estimate of Scottish corporation tax should be treated with extra caution”.
In 2003-04 and in 2004-05, GERS allocated £2.4 billion in corporation tax, yet we know that in that latter year, the Royal Bank of Scotland alone paid £2.38 billion in corporation tax. We also know from a survey of 27 of Scotland’s top 50 companies in the same year that they made a profit of £14.794 billion, which would have generated some £4.3 billion in corporation tax. We know from The Scotsman last week that last year Scotland’s 500 biggest companies scored a combined record of £23 billion profit, which would have generated a corporation tax yield of somewhere around £7 billion. So we know that the corporation tax figure is wholly wrong and cannot be trusted.
The principal conclusions in GERS are described as deriving a fiscal position for Scotland. They are
“subject to inevitable imprecision due to the need to estimate a number of elements of both expenditure and revenue. The calculation of expenditure for Scotland (specifically the non-identifiable and other expenditure components) cannot be carried out with the same accuracy as that for the UK as a whole.”
It is such inaccuracy that I hope the independent board and the Bill will help to resolve.
On the issue of expenditure I have several examples, because this point does not affect Scotland alone, as I shall explain. The non-identifiable expenditure allocations for Scotland include many things, such as, in 2003-04, a Home Office allocation of £2.521 billion from English prisons and offender programmes. The figure included as non-identifiable some millions of pounds that went to the English Tourism Council and the Greater London authority from 2001-02 to 2004-05. It included as non-identifiable inward investment grants made to English regional development agencies by UK Trade & Investment between 2001-02 and 2005-06, and the Courts Service spending by the Department for Constitutional Affairs of £547 million—half a billion. In an average year, more than £3 billion of English only spending—rightly spent in England alone—is allocated as non-identifiable. That has the impact on GERS of overstating Scotland’s expenditure by £262 million and understating English identifiable expenditure by more than £3 billion.
We want impartial and accurate statistics that present a true picture of Scotland at all times. They cannot just be impartial; they must be seen to be impartial.
I have some concerns about specific clauses. It appears to me—I suspect that my perception will be shared outside the House—that there will still be Treasury control and interference. Under clause 3, Scottish Ministers cannot directly appoint a member to the board: that can be done only by the Treasury. Under clause 27, Scottish Ministers cannot direct without the approval of the Chancellor. Under clause 45, Scottish Ministers cannot authorise disclosure of information to the board without Treasury approval. Under clause 49, Scottish Ministers cannot authorise disclosure by the board without Treasury approval.
On certain occasions, such as in the case of cost-sensitive or highly sensitive market information, such Treasury control may be appropriate, but it cannot be so in every case, and I intend to table amendments to those clauses. They may be probing amendments, but I may have to press them further.
The Bill contains much to welcome, including the separation of communication and political comment, the recognition of concerns about pre-release access and— notwithstanding my criticisms of enshrined Treasury powers—the ability at least of the Scottish Executive to order statistics from the new board and have their efficacy guaranteed. We will not vote against the Bill tonight—I suspect that there will be no votes at all—but it raises real issues, to which we will return at a later stage. I look forward to hearing the Minister’s comments when he winds up.
It is astonishing that we should have discussed today whether politicians try to put the best aspect on the information that they have to present to the public. Of course they do, and have always done so. Indeed, if they did not they would be the political equivalent of kamikaze pilots. That has been the case in all political systems since the beginning of time, with the possible exception of Plato’s republic and its philosopher kings—which of course existed in Plato’s head rather than in reality.
My hon. Friend makes an important point. I was about to say that the point about a political system is the extent to which other views may be expressed, in terms of the gloss put on figures and what emerges from the process overall. The issue is not so much a lack of trust in statistics, but the lack of trust in our public system generally. Indeed, we could make a statistical correlation between the reduction in trust in the veracity of statistics and the reduction of trust in public servants and in communities. We live in an age in which trust in a variety of institutions, and one of those is the statistics on which other institutions have to take decisions and reflect the veracity or otherwise of those decisions back to the public, has decreased.
The problem is compounded by the fact that we get what look like statistics, but are not, about the statistics of perception in response to the very trust issues we started with. We get statistics saying that x per cent. of the public think that statistics have no validity. Those statistics of perception tend to reflect how people stand in relation to the information that they receive about the veracity of statistics and opinions. A small example is that only 7 per cent. of people actually travel on railways, but in every survey about the perception of whether the railways are improving or getting worse, a far higher percentage give their opinion. They are reflecting back to the inquirer the generality of view about that issue, rather than their own grounded experience.
It is not true that the public’s support for statistics has suddenly fallen. It is a longer term process. The general distrust of many areas of public service, public statistics and public activity is one of the features of our age. As has been said, we are subject to headlines that reflect back to the public the low level of trust. The famous quote is that there are
“lies, damned lies and statistics”.
Indeed, on a statistical count of the citations of that quotation in the Chamber today it is believed to be 100 per cent. true that the author was Benjamin Disraeli, but that exemplar of stealing other people’s clothes nicked it from Mark Twain and used it to good effect.
The opposite view was put, almost at the same time, by Florence Nightingale, who said:
“To understand God's thoughts we must study statistics, for these are the measure of His purpose.”
When we consider the issue of trust more generally, we might aim more towards Florence Nightingale and away from Mark Twain.
Indeed, the aim of the Bill is to restore trust. People will continue to express concerns about statistics, but the Bill introduces a form of presenting statistics to the public that is likely not only to be trustable but will show over time that statistics are impartial, real, and reliable. I recall the corrosive effect on the ability to trust any information whatever about unemployment after the 23 changes in calculating the statistics made in the latter stages of the last Conservative Government. I am certainly not saying that such distrust is a sudden occurrence, or a change from the past, but it is important that there be reliability over time in an area of previous low trust in terms of the perception of statistics and their use in the presentation of public policy.
The Bill takes us considerably further down the road of changes made after 1997 to introduce on a non-statutory basis far greater independence of the statistical service. It makes the changes statutory, and provides for an independent commission to oversee them, and guarantees for the veracity of statistics.
I want to consider the question of how the commission will relate back to Parliament. The Bill contains a number of ways for Parliament to scrutinise the independent collection of statistics, which are welcome. My hon. Friend the Financial Secretary invited us to consider the effect of the changes on parliamentary scrutiny, and how such scrutiny might best be advanced. He and other Members said that that was not something for the Bill, but that perhaps the Leader of the House might consider it. However, I draw the attention of the House to what could be a useful parallel from earlier legislation: the Political Parties, Elections and Referendums Act 2000. One of the centrepieces of that measure was the setting up of the Electoral Commission. The chief commissioner was a Crown appointment and the commission was an arm’s-length, non-ministerial body with a separate source of funding, charged to oversee a disputed part of public life that needed that degree of reliability and veracity to inform the process and enhance trust in it.
There are a number of parallels with what transpired at that time. As you will recall, Madam Deputy Speaker, section 2 of the Act set up a Speaker’s Committee on the Electoral Commission. It continues to function, not as something that owns the commission, or as something that is in the pay of the Executive or the Opposition, but as a body in Parliament, holding to account and bringing accountability to an institution that is not in Parliament. The establishment of the Committee largely resolved the issue of how the process of questioning, debating and making reports through Parliament should take place. As Members know, each cycle of parliamentary questions includes a period—admittedly only a short one—when we can put questions to the Member who represents the Speaker’s Committee on the Electoral Commission.
Furthermore, the House of Commons Commission, over the past few years, has developed the practice not only of placing a report before Parliament each year, but also of initiating a debate on the report on a guaranteed basis. Through the device of a Speaker’s Committee on the statistics commission, we could bring about an arm’s-length relationship that allowed the commission to be accountable to Parliament without being owned by Parliament, which could resolve a number of the questions that remain about a Bill that in most other aspects provides important ways forward to ensure the veracity of statistics and their role in public life.
I commend the Bill. I have not yet heard any voices seriously raised against its intentions, but we need to get it right so that the House can make sure not only that an account is given but that the process itself is held to account. That is important, and can be achieved by processes of which the House already has experience, and which it may be able to replicate to the benefit of the Bill.
It is a pleasure to have the opportunity to discuss the Bill. There is common ground throughout the House that there is a need to do more to improve confidence in Government statistics. I do not think that anyone particularly feels that statisticians are in any way corrupt, misleading, dishonest or incompetent, but we sense that there is widespread concern and scepticism among the public.
Several Members have cited the ONS study showing that only 17 per cent. of people believe that official statistics are produced without political interference. That has to be put in the context of broader concern about the use of statistics. The same survey showed that 59 per cent. of people perceive that the Government use statistics dishonestly.
I have been a member of the Treasury Committee for about a year and I have noticed that once the experts, such as the Institute for Fiscal Studies, get their hands on a Government announcement after a Budget or a pre-Budget report, the statistics that we have been given are not necessarily what they appear to be. There is evidence of double counting, reannouncements and so on. That is a broader and more significant cause of scepticism about statistics, rather than the fundamental structure of Government statistics.
That is not to say that the Bill cannot help. Its intention to restore confidence by giving greater independence to the statisticians is admirable. Sometimes, politicians too easily cry for independence; a theme of the next premiership may be the granting of greater independence to all sorts of institutions. However, we have to balance independence with accountability and sometimes that does not happen. Clearly, if ever there were an area in which independence was appropriate, statistics would be it, so we must apply a test to the Bill: does it give the independence that it should? In many cases, the answer is that it simply does not.
I shall give an example that has not been particularly dwelt on during the debate. There are to be six non-executive members and three executive members of the statistics board. The Government will appoint all six non-executive members. One will be appointed by the Crown—we know that that effectively means the Government, although we do not know whether the appointment will be made on the advice of the Prime Minister or the Chancellor—and the five others will be appointed by the Treasury. As for the three executive members, one, the national statistician, will be appointed by the Crown. Nothing in the Bill addresses the role of Parliament. That theme has been touched on by many hon. Members, including the hon. Member for Southampton, Test (Dr. Whitehead).
The Bill misses an opportunity. We do not have to follow the National Audit Office model as far as statistics are concerned, although it clearly has support on both sides of the House. Even if we opt for the Government’s preferred model, Parliament could have a role of greater involvement, especially on appointments.
There is a process whereby members of the monetary policy committee of the Bank of England attend hearings in front of the Treasury Committee. The Committee is examining that process again in the next few months, and without prejudging that review, I think that there is room for improvement and that the process could be beefed up. None the less, there is at least a process whereby members of the monetary policy committee appear before a cross-party group of parliamentarians and are reviewed. The Bill does not allow such a process to occur, which is regrettable.
More generally, Parliament should have greater involvement in determining, reviewing and consenting to Crown appointments. I hope that both parties will examine that to a much greater extent in future. This is a missed opportunity, because we want to give individual members of the board greater authority and for there to be not just independence, but the perception of independence. I do not think that the appointment process does anything to achieve that.
Greater independence might be granted to members of the board by considering the question whether they should serve one term. At present, such people will be eligible for unlimited reappointments. In such circumstances, there would always be a tendency for people to say, “Well, I don’t want to upset the Treasury, so I will keep my nose clean,” and that may impose a pressure. There might be merely a perception of a pressure, but there would be a pressure none the less.
I turn to the code and its application to official statistics as opposed to national statistics. Ministers will remain responsible for all statistics produced by the Departments other than those designated as national statistics. Who decides whether a statistic is a national one? The Ministers themselves will do so; they will decide whether to make an application to receive that kitemark. That is regrettable and I hope that that aspect of the Bill will be re-examined in Committee. The statistics board ought to have the right to say, “These statistics are so important and significant that they should fall within the scope of national statistics and the code should apply fully to them.” I do not understand how the code will apply, if it will do so at all, to those statistics that are merely official statistics and not national ones. That is a great failing of the Bill. My hon. Friend the Member for Chipping Barnet (Mrs. Villiers) made the point that as a result of that, the Bill’s impact will bear down most heavily on statistics produced at present by the Office for National Statistics, as opposed to departmental statistics.
The Financial Secretary, who is sadly not in the Chamber, said in response that if one considered the matter numerically, the majority of national statistics were produced by Departments. However, I checked the record of the evidence that he gave to the Treasury Committee back in June, when he argued that one of the reasons why the residual Department should be the Treasury was that the majority of national statistics were economic, especially those produced by the ONS, and said:
“The importance of those statistics and the frequency of them generally are higher than other departments.”
My point in response to the Financial Secretary is that it is the statistics produced by the ONS that will be affected most by the code, although, as Lord Moser has pointed out, they are probably the aspect of statistics that is least in need of reform and support.
I mentioned the Treasury’s residual authority. The Treasury Committee concluded that it was right that the Treasury should retain that position, but the decision was clearly finely balanced. The Financial Secretary’s argument to the Committee was that many statistics were economic matters—that is clearly right—and thus Treasury-related, but that clearly cuts both ways. Is it right that the Treasury, which is the Department that is most under scrutiny as a consequence of national statistics, is also the Department with residual powers? One could argue that those residual powers are pretty minimal, but they include appointing the board. We thus find ourselves in an unfortunate position.
It is the Treasury that is most prone to the tendentious presentation of statistics. At the time of the last pre-Budget report, claims were made of extra billions going into schools for capital and extra amounts per pupil, per year. When the claims were examined by the Institute for Fiscal Studies, they turned out not to be anything like those that the Treasury made. That is not an isolated example. If we were to consider the period during which the culture of spin most got hold of the Government, we could look at the time when public spending projections were triple counted and the Chancellor was able to make great claims about the billions of pounds that would be spent on public services by rolling up the figures for various years. The Chancellor stopped doing that to an extent during a time at which public spending was rising rapidly, but now that that is coming to an end, he seems to be using the same approach again. It is unfortunate that a Department that has acquired a reputation for spin in recent years will retain its control.
Many, including Lord Moser, have argued that the obvious Department to have control of this is the Cabinet Office, and I have a lot of sympathy with that view. However, there is a great deal of speculation about what will happen to the Treasury following the change of Prime Minister later in the year, with talk of it being split into two and the creation of a beefed-up Cabinet Office. Perhaps the fact that the Government are continuing to pursue the line that the Treasury should be the main Department for statistics suggests that no such thing will happen and that the Treasury will remain intact—maybe I am reading too much into this. However, I have no doubt that if the policy changes while the Bill is being considered in Committee, something could be read into such a change of approach.
On pre-release, I must say that I did not envy the Financial Secretary having to try to justify the policy, even given the announcements that he made today about restricting pre-release to 40 hours. I asked how many of the 79 respondents to the consultation process welcomed the Government’s proposals on pre-release, and I did not get an answer, other than, “Well, everyone seems to recognise that the proposals need to be tightened up.” However, they have not been tightened up nearly enough. If we list those who have considered the issue—the Treasury Committee, the Statistics Commission, the independent Phillis review of Government communications, the Royal Statistical Society, Lord Moser and, I am sure, others—we can see that all of them are concerned about the policy on pre-release, but none of them, as far as I can tell, is satisfied that the Government’s proposals go nearly far enough in dealing with the issue.
The Government give two arguments on why pre-release on the scale proposed is so important. The first is that it makes it easier to deal with the media. Of course it does, but that in itself does not justify the provision; in fact, it is perhaps an argument for why we should not allow pre-release on the scale proposed, as it is very easy to pick out the nuggets of good news and get them into the papers before anyone has the chance to digest the more complex statistics. The second argument is that Ministers need to be able to announce policy decisions immediately after the release of the data. During the Financial Secretary’s speech, I asked a question; I do not know whether the Economic Secretary can answer it. Can he give one example of a case in which the Government made a policy announcement as a consequence of having pre-release access to statistics?
Indeed. I am grateful to my hon. Friend for that clarification. On international comparisons, the hon. Member for Colne Valley (Kali Mountford) said that she was aware of only one European country that did not have some form of pre-release, but according to the information that I have seen, Austria, Denmark, Finland, Norway and Poland do not have pre-release at all. In those countries that do have it, it is very much curtailed, and is more like three hours. Ultimately, I agree with my hon. Friend the Member for Chipping Barnet that the issue should be determined by the independent statistics board. The Government’s position cannot be justified.
The statistics board will be subject to a potential conflict of interest, and it could be dragged in two directions, a point that has been addressed by a number of hon. Members. The board will both supervise statistics as a whole and be involved in the production of statistics, and that is a difficult situation. The Statistics Commission has performed a useful role in scrutinising official statistics, and one of the reasons that it was useful is that it is not involved in producing statistics itself; it is an independent body. It is to be abolished, and I have concerns that that will leave us without a body that performs that role. I have my doubts about whether the statistics board, albeit that it will have internal Chinese walls and what-have-you, will deal with that problem. I recognise that there is scope for amendment, but I do not think that the provisions included in the Bill at the moment address those concerns.
In conclusion, the Bill, as it currently stands, is a missed opportunity. It establishes an independent statistics board, but the board’s membership is tightly controlled by the Treasury, and its responsibilities for producing statistics may conflict with its role of providing independent oversight. The Bill establishes a code, but allows Ministers to decide which statistics will have to comply with the code. As for the most obvious abuse in the system—the pre-release access arrangements—the Bill preserves the power of Ministers to determine the rules. For those reasons, I hope that, in Committee, there will be substantial amendments to a Bill that has the best of intentions, but that fails to live up to them.
It is a pleasure to follow my hon. Friend the Member for South-West Hertfordshire (Mr. Gauke), who covered the Bill’s various clauses extremely well. I look forward to joining him in Committee next week, where we can pick up on some of the concerns that have been expressed. I welcome the Bill, which is a good example of the deepening consensus among all parties on certain pieces of non-contentious legislation, particularly as it shows that the Government have picked up on clauses in the Conservative party’s last election manifesto. The Government have obviously read it, as it called for an independent national statistics office. It is also clear that, more recently, they have picked up on the shadow Chancellor’s call for a triple lock to ensure proper stewardship of public accounts, as the proposal in the Bill is one of the three important elements of that triple lock.
The measure is necessary because we have had 10 years of spin on our national accounts and statistics. That spin was not confined to No. 10 Downing street, but emanated from No. 11, too, where it has been one of the Chancellor’s defining trademarks. A number of Labour Members, who are not present at the moment, sought to distance the Government and politicians from the lack of trust in our national statistics, but the evidence from the Treasury Committee report is pretty compelling on that point. On page 12, paragraph 14, it quotes the Statistics Commission, which undertook a review in 2005, in which it said:
“It is felt that, of late, the production of statistics has become politicised and when set against a backdrop of distrust in the Government generally, then a comprehensive restructuring of the statistical service is necessary.”
The fact that such a restructuring was necessary is made evident by the Bill, and by the Financial Secretary’s introductory remarks. He acknowledged that lack of trust in our national statistics, so his colleagues’ attempts to distance the Government from the problem fall rather flat on their face.
I should like to illustrate, with a few brief examples, some of the problems that I hope that the Bill will seek to correct. They go right to the heart of the statistical base of the economy—to, for example, the definition of gross domestic product. The national accounts have been re-based several times in the past 10 years, and that has played havoc with data consistency and continuity of the series of that vital information. Items have regularly been added to the scope of measures of gross domestic product, and that offers the potential for rewriting recent growth history of GDP, often to flattering effect. A more recent example is the inclusion of own-account computer software, which increased GDP by 1 per cent. in 1999 and subsequent years. The Office for National Statistics subsequently acknowledged that software estimates—and I quote from its “Economic Trends” of February 2006—
“did not meet international best practice”,
and that is why the series was revised the year before last.
Another example is the impact on the public accounts of changes of definition of general Government spending, particularly since and including the adoption of the European standard accounts, known as ESA95. Let us consider the 1997-98 national accounts, the last set of accounts for which the Conservative Government could be held responsible, as they largely followed the 1997 Budget. Taking into account all the changes to the definitions of general Government spending and GDP over the past 10 years, a £10 billion reduction on Government expenditure is revealed. That is roughly equivalent to 1.4 per cent. lower expenditure, as a proportion of GDP, than was the case at the time. On the revenue side, the impact is even greater, as the ratio of non-oil taxation to GDP at market prices in the 1997-98 accounts is 1.7 per cent. less than the numbers that were reported at the time. Those figures clearly help to flatter the Government’s public accounts position and management of the golden rule and various other rules by which the Chancellor seeks to conduct his policies.
Another example is the taxes paid directly to the European Union, which are excluded from the definition of Government receipts. Tax as a percentage of GDP is therefore reduced, as it is no longer paid directly to the Treasury, even though individuals and businesses have to fund the payment. They pay it, but the Government do not see it. In the fiscal year 1997-98, that sum amounted to £5.8 billion in today’s prices or 0.7 per cent. of market price GDP on current definitions. It is hard to find in official British data sources what the sum is. Quarterly figures for taxes paid directly to the EU, such as the VAT precept, are tucked away in a series of statistics in the ONS’s calculations of the balance of payments, and do not appear in its taxation series at all.
Another statistic by which the Chancellor sets a great deal of store is the calculation of public sector productivity. I remind the House of his claim in the pre-Budget report of 1998 that productivity growth was the
“fundamental yardstick of economic performance”.
That is an oft-quoted phrase, but the measurement of public sector productivity—I acknowledge it has improved over the past 10 years—remains woefully inadequate. As the ONS accepts, it is difficult to calculate that growth. It is important, both because it is the fundamental yardstick by which the Chancellor wishes to be judged, and because productivity gains swell GDP and thus, by definition, help him to meet his targets.
An example of the potential for distortion is the calculation of the Gershon efficiency savings, which are more recent than other examples I have given. Despite Government efforts to present those efficiency gains as genuine and verifiable, I am not alone in doubting them. For example, if we look at non-cashable savings in local government, officer time spent working on efficiency gains counts as an efficiency gain. If we look at capital projects, reductions in tender prices through negotiation on capital projects that have not yet been contracted count as an efficiency gain. Those are notional gains—they are definitely non-cashable—and they leave plenty of room for doubt.
I wish to consider three clauses in the Bill, including one on pre-release data, which has been well covered by other hon. Members. The Government have made a feature of seeking to encourage greater transparency across government and the private sector, where companies are encouraged to provide timely and complete disclosure. In the public sector, a raft of target-setting and value-for-money assessment regimes, as well as the Freedom of Information Act 2000, are designed in part to increase transparency and allow greater scrutiny by outsiders and independent bodies. In the Bill, however, the Government seek to apply the existing 40.5 hour pre-release limit to market-sensitive data—not a great advance. As we have heard from many speakers, that is the longest period of advance notice available to any Government of a comparable major economy. Why have the Government failed to take advantage of the opportunity offered by this welcome Bill to look at the issue again?
On page 49 of its report, the Treasury Committee cites the conclusion on the release of market-sensitive data reached by the independent Phillis review of Government communications in 2004. The review decided that there was
“no need for the 40 hours of advance notice of National Statistics that Ministers receive”.
I therefore support the call by my hon. Friend the Member for Chipping Barnet (Mrs. Villiers) for a reduction in the time limit. Indeed, the board itself should decide what the time limit should be. On the issue of pre-release, data should be released in tandem with ministerial comment. Other hon. Members have referred to the problem of allowing Ministers time to put their gloss and spin on numbers as they are released. There would be greater confidence in the numbers if they were made available publicly in a simple format by the board—perhaps through the statistical hub that has been mentioned—with Ministers making a separate release in which they put whatever complexion they wish on the figures. Commentators would be more confident about the figures if they thought that a Government Department spin machine was not driving events.
The Financial Secretary referred to the statistical hub. The expression is not used in the Bill, but it is an important and welcome development. If I understood him correctly, benefits would derive from consolidating data releases through the hub. That is quite right, but it is important to look at the proposal in detail in Committee. There are a number of problems with the release of data, many of which have not been covered in our debate, not least the importance of making information available in a readily accessible form. That applies not just to national statistics, as reform would be welcome across government. As the Economic Secretary is in the Chamber, may I remind him that the Chancellor’s pre-Budget and Budget reports have shown a worrying decline in the availability of simple, factual information compared with reports issued by his predecessors? For example, there used to be a standard form of release for politically sensitive figures on the way in which Budget tax changes affect particular income groups, but such figures are no longer available in the published documents.
The economic trends published by the ONS used to show the way in which Britain’s tax and social security burdens compared with those of other countries, but that information has not been published since March 1999, so commentators have to dig around for the data independently. It would be useful if that information were restored to the statistical hub.
The ONS increasingly tends to release less favourable data in a non-standard form on Excel spreadsheets, tucked away, without any announcement at the front of the website. Although the data appear on the website, it is important that in Committee we consider whether any new data that are released could be flagged up at the front of the website, rather than released on the website with no fanfare at all, so that only data junkies who expect to find it can go in and look for it. An example is the taxes and prices index, which shows the direct and indirect tax effect on prices. It appears to have been quietly dropped by the Treasury and therefore by the ONS, because it is hidden in the depths of the website. The solution would be to flag up every new release on the front page of the website, so that people who look at it regularly will know that it is there.
The third clause on which I shall comment is clause 19, covering the retail prices index. Others have touched on the public concern about differing inflation rates, which are attracting considerable publicity. I wish to deal with the relationship between the national statistician, the Bank of England and the Chancellor in relation to any potential changes to the retail prices index. I welcome the fact that that is included in the Bill, confirming the power that the Bank of England has to consider whether any proposed changes to the RPI calculation would be sufficiently detrimental as to adversely affect holders of index-linked gilts. It is important that that is written into the Bill.
However, if the Bank of England does so determine, it is merely up to the Chancellor to decide whether the change should be implemented. I am not sure that there is a sufficient safeguard to allow that to be done at the whim of the Chancellor. Although I am sure that he would recognise his responsibilities, it is important not just because of the impact that the decision would have on existing holders of the eight index-linked gilt issues that are outstanding, but because of the effect on the market, the public and international investors, and their confidence in the Government and in the Government’s integrity and credit rating. That would all be at stake, should changes of such magnitude be put through. The matter is so significant for this and any subsequent Government that the provision needs close scrutiny in Committee in order to ensure that the Government are obliged to honour their commitments.
It would be helpful if the Economic Secretary could confirm that there is now agreement with the Clerk of the House as to how the reports will be laid. Those who have read the written evidence to the Treasury Committee on the independence of the statistics know that that was an issue. It would also be helpful if the hon. Gentleman could reiterate what the process will be for raising questions that have political significance, which the national statistician would not properly be able to answer. There are further issues in the Bill that may come up now or in Committee.
The scope of clause 20 interests me. The board has freedom to do virtually anything. I do not see the limits to it. Would it, for example, be able to carry out the same opinion surveys as YouGov, Ipsos, MORI or ORC do for clients outside Government? If I have missed the limitations in the Bill, perhaps the Economic Secretary will be able to spell them out for me.
I recommend to those who follow the debate, who are more likely to be specialists than generalists, that they reread the written evidence to the Treasury Committee in its report published on 18 July. That will refresh their minds about some of the more expert opinions, to which we add. I am not the statistician in my family. I am not even the best mathematician, but I have perhaps had more experience of parliamentary service and ministerial service than most others in my family. I remember that when I first became a Minister, officials from the research department of the Department of Employment came to me with a report that did not confirm the prejudices of one of my predecessors, and asked what should be done with it. I said that I assumed that all research paid for by public money was published. They looked at me as though that was the right answer, but they were expecting to tell me that, rather than my suggesting to them that that was the right thing to do.
Can the Economic Secretary tell me how difficult it would be for Government to take on the obligation that all research done for Government, with certain obvious exceptions such as security or significant economic national interest issues which for some reason could not be made public, is published? That would include opinions, possible future policies and all other research, unless there is an explicit reason why it cannot be made available.
I am not saying that there should always be a press notice. However, following on from the remarks of my hon. Friend the Member for Ludlow (Mr. Dunne), when Governments start putting statistical information on a website without any public announcement, could it be a requirement that they notify the statistics board that they have done so? If the information is not statistical, but is important for some other reason for the public to know, could they find a way of making that known to an invigilator? Although I am not trying to suggest that most of the things that the Government try to do are done in the wrong way, for a wrong purpose or as a result of a wrong policy, this Government can accurately be accused of being more misleading and more guilty of covering things up than many others whom I have observed.
Returning to the research report, I suggested that we hold a press conference and that the press people give three days’ notice of it. The press people rang up every journalist who might conceivably come a few hours before the press conference to add that they thought that the Minister wanted some personal publicity. One journalist came to the press conference and there was no report on that rather embarrassing research result. I commend that approach to the Economic Secretary.
My general approach in my six years as a junior Minister was that it is normally better to make an existing system work better than it is to change the system. The Government brought in the Statistics Commission six years ago. I know a number of the members of that commission and I do not see why it had to become integrated with the executive side of the ONS. The Economic Secretary clearly knows about the evidence presented by the Royal Statistical Society and others that the Government should not have done that.
Last year’s Government response to the Treasury Committee did not explain why the Government did not follow the professional advice that they were given. They said that they would not follow it, but they did not explain the reason in detail. Given the weight of those who argued that the Government should have maintained the separation between non-executive invigilation, support for the independence of the statistical service and the executive work that the statistical office itself must do, the House and the country, as well as the statistical service, deserve a detailed explanation from the Economic Secretary—fortunately, he will have plenty of time to do so in this debate.
There are plenty of amusing things that one can do with statistics, and one of the better examples was told to me by the member of my family who is a statistician: the hourly pay rates of women in part-time manual work are lower than those of men in part-time manual work; the hourly pay rates of white-collar women in part-time work are lower than those of white-collar men in part-time work; but taken together, the figure for all part-time women is higher than that for all part-time men. One needs to be quite a good statistician to know how that is possible—more women than men work part time in white-collar jobs.
That issue does not matter a great deal in this debate. What matters is whether the Government are asking the statistical service to do the right kind of work, whether they make changes in a rational way that has the support, if possible, of people in the statistical service and outside users, whether they put embarrassing information behind some kind of curtain and whether they mislead people by putting out their commentary without allowing people to see a reliable statistical series.
I hope that the Economic Secretary will confirm—I expect him to do so—that the dates for the release of information in a regular series will be announced a year in advance. I also hope that he will confirm that it is the duty of Ministers to ensure that the statistics from their Departments, whether that involves National Statistics or departmental statistics, are released in press notices that contain the same information in the same order and that any changes to the way in which the statistics are presented will be announced in advance and will not be released suddenly because the figures are available in a particular month, quarter or year.
To those who believe that some kinds of statistics are easier than others, I offer one example. Road casualty figures used to come out in a report called, “Road Safety”, which was not about road safety at all, but the opposite—road casualties. I think that it is now called the accident report and that it counts casualties. When, as a junior Transport Minister, I asked how soon I would know the provisional figures for those who had died in a particular month, I was told that the preliminary provisional figures came out two months after the end of the month in which I was interested. That was because people were counted as having died within the month if they died within 28 days of the crash. I asked why we could not assume that the 28-day hangover, or tail, was roughly the same month by month so that I could have the provisional preliminary figures, or at least an indication of them, on the day after the end of the month. Eventually, it was decided that that was possible.
The figures on drink-driving, which is another critical issue in cutting casualties, came out every six months. The road casualty figures came out more than a year after the year of their being counted because of the need to reconcile information from the police “Stats 19” reports and to employ various other ways of trying to ensure that the statistics had integrity. It was only when I started pushing that we discovered that the figures for the Metropolitan police were not being included in the national figures because a simple error was being made and a link in the statistical flow was missing. That was a pity, but it was not crucial because it was nobody’s intention to try to mislead.
I am trying to make the Minister understand that having the purpose of statistics in mind matters as much as the statistics themselves. Obviously, changes sometimes come about. In the Department of Employment in the old days, say from the time of the war onwards, industrial disputes were counted with mining in one column and the rest of industry and commerce in another. When the mining industry stopped having its series of disputes and then, as events turned out, was going to be significantly reduced, there was no need to carry on doing that. The purpose of statistics can change, as can what people want to focus on. The statistics service, in Departments and centrally across Government, should provide a dampener on Ministers’ enthusiasms. The half-life of the average junior Minister is about nine months. That means that we may find changes to the statistical service being pushed forward by enthusiastic Ministers who have come in and are trying to make a name for themselves but are not there to see the results of their initiatives. I hope that the statistical service, in Departments and in National Statistics, which additionally covers most Departments, will be backed up with sufficient weight to show that there is a degree of inertia in the system as well as a responsiveness to what people are trying to achieve.
It is far better to have earlier figures with subsequent revisions than to wait for too long to have figures that need far less revision. Certainly, an early indication of what was going on helped me when I had ministerial responsibilities and contributed to some pretty dramatic changes in important matters such as drink-driving, whereby we cut the incidence of drink-driving by young men by two thirds in two years with no changes to the law, sentencing or enforcement. We found an approach that was working and needed the statistics to show us that what we were doing was correct.
I hope that people will use statistics not in the time-honoured joke way but to illuminate what they are doing and give an indication of what they should be trying to achieve. The public purpose of statistics should be to help achieve ambitions, and that matters a great deal.
I am delighted to have the opportunity to respond to the debate on behalf of the Opposition, not only because of the quality of the speeches but because I have a specific interest in the future of the Office for National Statistics. Its Titchfield office is based in my constituency and, as a consequence of the campaign that I fought with union leaders, it remains there and was not closed as part of the Lyons review when jobs were relocated to Newport and the constituency of the hon. Member for Newport, West (Paul Flynn), who was in his place earlier. I therefore have a concern about the future of the ONS that perhaps goes beyond a shadow Minister’s normal responsibilities.
Let me begin by highlighting some of the contributions. The hon. Member for Bolton, South-East (Dr. Iddon) focused on part 2, the existence of which reflects his tenacity in pursuing the objectives of the organisation of which he is a patron and ensuring that the interests of civil registrars are heard.
The hon. Member for Twickenham (Dr. Cable) highlighted the agreement between Front Benchers on many provisions and some of the broader issues on which there is consensus throughout the House.
The hon. Member for Slough (Fiona Mactaggart), in a powerful and thoughtful speech, spoke about the accuracy of data and its importance for her and her constituents. She also made an important point about the ability of the ONS to respond flexibly when errors in data collection are identified. She spoke, especially from her constituency experience, about collecting data on the migration of people. The Bank of England has made a similar wider point about its policy-making decisions. How can it form a proper basis for the decisions that it makes if one cannot catch data on matters such as migration more accurately?
My hon. Friend the Member for Sevenoaks (Mr. Fallon), who chairs the Treasury Sub-Committee, made a powerful speech that set out the case for reform. He is right that the key test for National Statistics is whether it will be perceived as fully independent of the Treasury. In the main body of my remarks, I shall identify the progress that I believe that the Government have made in the Bill and emphasise how much more progress could be made if we were to make the body fully independent.
The hon. Member for City of York (Hugh Bayley) was one of several Members who made a case for better parliamentary scrutiny. He considered the National Audit Office model of scrutiny, and other hon. Members proposed different models.
My hon. Friend the Member for Braintree (Mr. Newmark) made an important contribution that reflected the conflict between delivering statistics and who has oversight of the system. He spoke about that in the context of individual statisticians working in Departments and of the board that the Bill establishes.
The hon. Member for Colne Valley (Kali Mountford) spoke about the complexity of data and considered whether that was one of the factors that led to people mistrusting Government statistics. She was right to make the point that, as data become more complex, people lose faith in them. However, I take issue with one of her points. Ministers can get early access to data and use the complexity as a means of picking out key information for them and their purposes. It is therefore not simply a matter of publishing a full set of data—she referred to the crime survey—but of the way in which Ministers use early access to shape their presentation and publication.
The hon. Member for Dundee, East (Stewart Hosie) spoke of the need for greater devolution of statistics to the devolved Administrations. However, from listening to professional bodies during the consultation on the Bill and in the Treasury Committee, the need for greater coherence and consistency of statistics throughout the United Kingdom, as well as the problems that emerge when statistics are collected by different Administrations, became clear.
The hon. Member for Southampton, Test (Dr. Whitehead) spoke about the means of increasing parliamentary scrutiny of the statistical service, the Speaker’s Committee on the Electoral Commission as a model for greater parliamentary scrutiny, and the way in which that Committee gives my neighbour and hon. Friend the Member for Gosport (Peter Viggers) the opportunity to answer questions from hon. Members in the House every four weeks.
My hon. Friend the Member for South-West Hertfordshire (Mr. Gauke) also took up the challenge of increasing parliamentary scrutiny of the board. He focused on increasing scrutiny of appointments to the board and the role that Parliament can play in making such appointments.
My hon. Friend the Member for Ludlow (Mr. Dunne) talked about problems with the definition of national income and spending, about the ways in which the presentation of data can be used or misused through changes to statistical series when data are discontinued, and about how data are publicised to a wider audience.
The speech of my hon. Friend the Member for Worthing, West (Peter Bottomley) was based on his experience as a Minister. He offered plenty of guidance to Ministers on the constructive use of statistics and some suggestions on how they might want to bury bad statistical news as well by publicising it even more widely—a novel approach to publication.
The hon. Member for Wolverhampton, South-West (Rob Marris) should have been in his place to hear it, but I am sure that he will be able to read what was said in Hansard tomorrow.
As my hon. Friend the Member for Chipping Barnet (Mrs. Villiers) made clear in her opening remarks, we see independent national statistics as a key plank of the triple lock on economic stability. It is vital that people can trust our Government statistics and that economic and social data are produced in a robust fashion, free from political interference. It is no reflection on the staff of the Office for National Statistics, including the more than 1,000 people who work for it in my constituency, the national statistician or her predecessor that confidence in Government statistics is so low.
We know of examples—we have heard more tonight—where the Government can present information in a misleading fashion to suit their own ends. Although the Government may achieve a short-term political goal, in the longer term it erodes public confidence and trust. In one respect, the Bill is a response to that erosion of trust and confidence in national statistics.
Looking back a paragraph or so, one of the reasons for lessening confidence in public statistics is that, under Len Cook, the ONS kept revising the statistics—on national growth, for example—so I think that there is some responsibility within the ONS. There are other factors, but that was a factor in the lessening confidence.
That reflects the complexity of data collection and the changing economy. The hon. Member for Slough talked about issues surrounding migration data and I recollect that one issue affecting data in around 2000 was the ability to capture transactions on the internet. That represented a move away from traditional sources of data collection, but I do not believe that we can blame the ONS for a change in the way the economy operates. As the economy changes and as population flows change, we need to reflect on it and adjust data collection methods in order to ensure that the data are complete. The ONS has a difficult job keeping up with those changes in the underlying economy and ensuring that it captures all the data. It may be as a consequence of changes to the economy that restatements have to be made in respect of the initial data released.
A key point is that the Bill presents an opportunity for radical reform. I think that the Minister said that it was about 60 years since the last major statistics Bill was debated in the House, so we are talking about a once-in-a-lifetime opportunity. I am afraid, however, that although the Treasury has made some progress towards greater independence, it has not gone far enough. The Bill could have been used to introduce more radical reforms to reassure users that statistics will be produced on an independent basis, free from potential political interference and in a way that will rebuild public confidence and trust.
For statistics to be seen to be free from political interference, we need to satisfy four criteria. The governance and funding of the ONS have seen to be free from political inference and there has to be proper scrutiny of those who produce Government statistics. It is vital to have a clear structure that imposes the same rigour on the production of statistics across the whole of government and not just in the ONS. Finally, rules around access to statistics should be robust and limit the Government’s ability to put pre-emptive spin on them in advance of publication.
How does the Bill measure up to those criteria? In the draft Bill that was produced before the last general election, we said that we should look to the NAO model of funding and scrutiny, and try to apply it to the ONS. The Government have gone part of the way down that route, but there is still progress to be made. The many comments that have been made by Members on both sides of the House about the increased role of parliamentary scrutiny of the statistics system show that the Government need to do more work in that area; perhaps we will return to the matter in Committee.
One of the provisions that we put forward in the draft Bill was to change the funding arrangements of the ONS to take it outside the normal spending round so that there could be no sense of the ONS or its senior management being influenced by the fact that the Treasury held the purse strings. Earlier in today’s debate, the Financial Secretary outlined the funding proposals that he would like to implement for the ONS, involving a quinquennial review of funding. I hope that we will find a mechanism in Committee to discuss how that will work in practice and to see whether it will create the independence for the ONS that we want to see.
Another welcome change that the Government have introduced is the statutory duty on the board to assess the quality of national statistics. A concern that was raised time and again today is that the same board that will have responsibility for oversight will also have executive responsibility for the preparation of statistics by the ONS. That unhelpfully muddles oversight with delivery. Surely the Treasury Committee report was right to state that
“we would prefer that the Government ensure a clear statutory separation between the role of the National Statistician in the executive (or operational) delivery of statistics, on the one hand and the board’s responsibilities for the oversight and scrutiny of the statistical system as a whole.”
We do not believe that the Government’s proposals for a national statistician and a head of assessment go far enough in separating the responsibility for production and for oversight. We need a clear divide at board level between those responsible for the production of statistics and those scrutinising their production if we are to restore public confidence and trust in statistics.
The Bill also makes progress in that it seeks to ensure that the code of practice is applied to all national statistics prepared by Government Departments and not just to those prepared by the ONS, but that leaves a raft of other statistical data not covered by this standard. It seems odd, given this opportunity for radical reform, to perpetuate a two-tier system. The Select Committee report identified 250 different statistical series produced by Government Departments that will not need to be produced in line with the new code. Surely we should put all official statistics on the same footing, so that users can have the confidence that all statistics produced by the Government are produced to the same standard. It ought to be the intention of the Government that all official statistics attain the same high standard.
On the dissemination of statistics, and particularly on pre-release access, the Bill represents a move forward, in that it talks about the need for a code and for a statutory instrument to set out a framework for pre-release access. It is unfortunate, however, that that framework will be determined not by, say, the board in consultation with the Treasury, but by the Treasury itself. Clause 11 sets out some fairly detailed parameters to define what should be in the statutory instrument, but the Government will still be able to exercise discretion, and to allow the rules to be flexible to accommodate their own needs. It would have been far better if the Treasury had gone a step further and given responsibility for the production of the code to the board. That would have given a clear sign to users that the pre-release was being done in a proper, transparent way and without being influenced by political considerations from the Treasury or any other Department.
My final point is about the use of administrative data collected for another purpose, perhaps by another Department, to produce national statistics. That matter has caused a great deal of debate, and was covered extensively in the Treasury Committee inquiry and the Minister’s response to it.
Although we welcome in principle the cost savings that come from not having to collect the same data twice from different sources, we need to ensure that the Bill includes sufficient safeguards to protect the confidentiality of data. We do not want a system in which data come from a Department to the ONS and are then taken out again by another Department for a wholly different purpose. We should make sure that that gateway is not two-way, allowing data to come in and out when that is inappropriate. We need to consider in Committee the detail underpinning the confidentiality provisions in the Bill to ensure that they are sufficiently robust to give people confidence that the data will not be misused once they are in the hands of the ONS.
This is not a dry Bill about statistics, but an acutely political one that tells us a great deal about how this Government have reacted in the past, the Prime Minister and his use of statistics, and the attitude of his likely successor. It recognises the loss of public trust in statistics in recent years and proposes modest reforms that hint at a break with the past—perhaps at a new style of government. Yet the reforms and their authors are betrayed by their modesty. By introducing the Bill, the Government implicitly recognise that they have eroded public confidence in the integrity and independence of national statistics, but there is a lack of will in the Treasury to embrace radical reform that would demonstrate a new approach.
The Treasury will use the cover of these modest reforms to show that it has changed, but their modesty indicates that it cannot and will not wean itself off its old tricks. The spin and misuse of data that we have seen in the past nine years is, I believe, set to continue if the Chancellor becomes Prime Minister.
I join the hon. Member for Fareham (Mr. Hoban) in paying tribute to speakers from both sides of the House in what has been a wide-ranging and informed debate. I shall do my best to do justice to the contributions from hon. Members from across the House. I thank them for the time that they have taken to prepare and contribute; I am sure that they will continue to show an active interest in the stages to come. I am sure that the Committee stage will be long and detailed and that much will be discussed. Given the standard of this debate, I am sure that in Committee there will be many interventions from both sides of the House.
It is notable that a number of former Ministers made interesting contributions, including my hon. Friends the Members for City of York (Hugh Bayley), for Southampton, Test (Dr. Whitehead) and for Slough (Fiona Mactaggart), and the hon. Members for Worthing, West (Peter Bottomley) and for Sevenoaks (Mr. Fallon), who, once he got beyond the party politics of debates about PFI and pension liabilities and on to the serious substance of his speech, made an important contribution.
I make particular reference to my hon. Friend the Member for Bolton, South-East (Dr. Iddon). As the hon. Member for Fareham said, he has campaigned for a decade to see the measures introduced in the Bill come to fruition, to ensure that registrars enjoy the employment rights that other people take for granted. People ask what the point of a parliamentary career or a ten-minute Bill is—all those hours of work and effort. In the coming years, the result of all his campaigning work, and the reality of this Bill, will be seen all around the country. We commend him for all his work over the years.
I want to address a number of the detailed points, but first let me make a few comments to give some context. As my hon. Friend the Financial Secretary said, the Bill is historic. It is the next stage in what has been a radical programme of reform of the institutions of British economic policy since 1997: the independence of the Bank of England, the new, statutory Financial Services Authority, the Debt Management Office, the code of fiscal stability and the independence of the competition authorities.
For each of those reforms, we put in legislation a requirement for clear and unambiguous objectives and a proper division of responsibilities, with case-by-case decisions being taken at arm’s length from Ministers, but having proper ministerial and parliamentary accountability and maximum transparency and scrutiny. The reforms of the statistical system that we put forward today are firmly in that tradition. In 2000 we introduced the framework for national statistics, the most far-reaching reform of the statistical system in over 30 years. The Bill builds on those reforms and on the strengths of the United Kingdom statistical system by retaining our decentralising approach to the collection and provision of statistics, while at the same time enshrining independence in statute. The quality and coherence of statistics throughout the United Kingdom will be further secured with the full participation of all devolved Administrations, which is a very welcome aspect of the Bill.
I shall say more about the role of Parliament later. Some have argued, as I believe the hon. Member for Fareham did a moment ago, that rather than adopting our evolutionary approach to independence we should have used the model of the National Audit Office. As my hon. Friend the Financial Secretary made clear, we consider the production of statistics to be an executive function most appropriately located in Government, rather than in Parliament. As we have also made clear, with the exception of Mongolia no country has created a precedent by placing the control of statistics in the hands of Parliament rather than those of the Executive. However, we make it plain in the Bill that—through scrutiny of legislation and secondary legislation, but also through the way in which both the Executive and the independent statistical service are held to account—the role of Parliament will be not just important, but substantially enhanced. I shall return to that issue shortly.
We will have ample time in which to debate the details of the Bill, but I think we are introducing a system that will meet our ideals and objectives. The Government believe that these reforms will accord with our principles in delivering high-quality, high-integrity statistics involving clearly defined roles and responsibilities, transparency, flexibility and value for money, as well as independence for the decision makers.
I am glad to say that the broad objectives of the Bill and the principle of independence for statistics have been strongly welcomed by the House today. I can also say that the Government’s decision to legislate for independence has been widely welcomed outside the House. We have consulted in depth on our detailed proposals, and we have received a very thorough report from the Treasury Committee.
I think it fair to say, on the basis of the consultation and today’s debate, that there is no single framework for independent statistics, and no clear consensus on the details of the model that we should adopt. Today we have observed some differences over how we should make a reality of independence, particularly in the context of the separation of the board’s executive and scrutiny roles—an issue raised by the hon. Members for Chipping Barnet (Mrs. Villiers), for Sevenoaks, for Braintree (Mr. Newmark) and for Worthing, West. Another issue was the scope of the board’s responsibility for official statistics and ministerial nomination of statistics for assessment, which was raised by the hon. Members for Chipping Barnet, for Sevenoaks and for South-West Hertfordshire (Mr. Gauke). A third was the role of Ministers in pre-release access to data, raised by the hon. Members for Sevenoaks, for Chipping Barnet, for Twickenham (Dr. Cable), for Ludlow (Mr. Dunne) and for South-West Hertfordshire. I shall deal with all three issues very briefly.
First let me deal with governance. Some have called for the establishment of two separate boards, one responsible for delivery and the other for scrutiny. That would have meant putting the Statistics Commission on a statutory footing, separate from statistical production. We considered the option carefully, but in our view a single institutional structure provides the most effective way of delivering greater independence for the ONS, independent scrutiny, and oversight of the statistical system as a whole, while avoiding the creation of competing centres of expertise.
We have introduced a number of measures to ensure a proper separation of production from assessment. That applies not least to the head of assessment, who will be appointed by the non-executive board members while being distinct and separate from the executive members, and will lead the staff work on assessment issues. Decisions on whether to approve something as a national statistic cannot be delegated, but must be made by the full board.
We do not believe that the structure replicates the problems cited by the hon. Member for Chipping Barnet. I think that the analogy with the BBC is a false one, although I am sure that the Committee will examine the issue in detail.
The hon. Member for Braintree feared that the role of the national statistician might be downgraded.
I will give way to the hon. Gentleman in a second. It is good to see him.
The national statistician will carry out the day-to-day delivery of the executive statistical production functions. Moreover, as well as being the board’s chief professional adviser, he will be a Crown appointment and the board’s chief executive. The board will be obliged to take account of his advice on all statistical matters. If the board overrules the national statistician, it will need to publish a statement and lay it before Parliament, explaining why it had chosen to do so. At the same time, the national statistician will be a full member of the board and will therefore share responsibility with other board members. In our view, that will enhance and strengthen the role of the national statistician, but within a framework in which there can be proper and unified focus on the executive functions of the service, and where there can also be proper scrutiny and accountability.
The Economic Secretary has announced two important safeguards for governance, and I have a couple of questions. Is he set on the balance that he has announced between the numbers of non-executive members and executive members, or might Ministers be open to debate on that? As for the Crown appointment, I would like an answer to the question I have posed twice today: will that appointment be made by Her Majesty on the advice of the Chancellor, or on the advice of the Prime Minister?
Before the hon. Gentleman arrived in the Chamber, I paid tribute to the thorough and effective report that his Sub-Committee produced, and I know that its work will have a real impact on debates in Committee in coming weeks. On the first of the two points that the hon. Gentleman raised, we have made it clear that although there will be three executive members, there will be at least six non-executive members. Therefore, it is clearly open for there to be more than six, but there will be six or more. As a result, there will be a majority of non-executives on the board. On the second point, it is my understanding that that Crown appointment will be the same as others; for example, the Governor of the Bank of England is appointed by the Queen on advice from the Prime Minister, and on issues as important as who should be the Bank’s Governor, the Prime Minister takes the advice of the Chancellor of the Exchequer. I expect that a similar process will occur in this case; it will be a decision of the Crown, but the Prime Minister and senior Ministers will have input into it, as it is important that we get the right person.
The hon. Member for Twickenham raised the issue of the Treasury versus the Cabinet Office—
I am unclear whether the Minister thinks that he has dealt completely and satisfactorily with the question of why the Government chose not to have a separate body supporting the executive statistical service. He said that they decided not to, and that that would have meant putting the Statistics Commission on a statutory basis. What has been unsatisfactory about the current arrangements, and why could he not have decided to have put the Statistics Commission on a statutory basis?
We had an earlier debate with the hon. Member for Sevenoaks about the potential for differences of view between the independent head of the Office for National Statistics and the independent head of the National Audit Office. In our view, there would be no gain in having two separate independent institutions additionally—one to produce the statistics and another to scrutinise. Given that the production of statistics is an important technical and intellectual matter but that it does not require the same kind of difficult political decisions as would be involved in, for example, decisions by the BBC, and given that the role of the board is to scrutinise quality but it is not a regulator in the sense that the BBC is a regulator, in our view it was possible to combine both functions—ensuring proper professionalism in production and providing proper scrutiny of quality—in one board. Therefore, it was decided that it was right to have a single, unified, independent statistical service, and that is the basis on which the Bill has been produced.
The issue I raise is not to do with why the Government have changed their mind since six years ago. The Statistics Commission was not the same as the ONS. Its role was to support it, and to invigilate—to be a watchdog—but also to be a supporter. The Government still need to explain, if not fully this evening then certainly in Committee—regardless of whether I am a member of it—why they could not just have made the Statistics Commission a statutory body, which would have allowed it to go on doing the technical work that the Minister has talked about. I am presuming that the reason is not to save money, because the Statistics Commission has not cost much money. There must be some other real reason, which I do not think Members yet understand.
There is a danger that we will hold the entire Committee proceedings in this final summing-up speech, and I shall try to avoid that risk. Previously under the current regime, the head of the ONS was not a decision maker on a number of subjects, which were matters for Ministers. The new national statistician will be an independent decision maker on a range of operational matters, as well as on the integrity of statistics. The view was taken that, given that we were strengthening the role of the ONS and moving to a statutory basis, we could build on the Statistics Commission’s experience and turn it into a fully fledged and statutory board. So all the functions presently undertaken by the commission will be taken over, in statute, by the board, which will also take over a number of functions currently carried out by Ministers that relate to the budgeting of the ONS and the national statistician. My hon. Friend the Financial Secretary has explained in detail the way in which those new funding arrangements will work, and that we will move to a five-year budgeting process. I have done the best that I can in a Second Reading debate to explain our thinking, and if it is okay I shall now move on—but there will be plenty of time to scrutinise these issues in Committee.
The hon. Member for Twickenham referred to the issue of the Treasury versus the Cabinet Office, and the hon. Member for South-West Hertfordshire helpfully reminded us—as did the hon. Member for Sevenoaks —that the Treasury Committee recommended that the Treasury retain those residual functions. That is what we have decided to do, having listened intently, where we could, to the advice of the Treasury Committee.
The second issue was scope, about which there was some discussion.
Before the Minister moves on, will he explain how the Government envisage that the very substantial area of non-economic statistics will be covered by the appointments that will be made on the recommendation of the Chancellor, and through parliamentary scrutiny, which should surely go well beyond the Select Committee on the Treasury?
I shall come back to parliamentary scrutiny in a moment.
On the board we will also endeavour to ensure that, as well as expertise from the devolved countries, we have the widest range of expertise. As the Financial Secretary made clear in our earlier discussion on scope, the issues considered under the category of national statistics go much wider than the economic. Indeed, the majority of series categorised as national statistics do not come under current ONS arrangements, so it is clear that the scope is very wide indeed. We will need to ensure that people appointed to the board through the Nolan process cover the widest range of expertise.
It is our view that the scope is wide, and it will be made wider over time—there was some discussion of this issue earlier, and I shall not repeat it here—but the idea that as a matter of principle, every official statistic should be a national statistic, independent of its importance or of the resource implications, is not realistic. For example, the Treasury collects detailed information on the number of parliamentary questions asked by Opposition Members. There is no need for that to be categorised as a national statistic and to be scrutinised through these processes.
But the code of practice is based on impartiality, integrity and objectivity, so whatever statistics the Government are collecting, it is surely worth collecting and using them only if they comply with the principles that will be enacted in the code of practice.