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UK statistics agency proposes scrapping earliest GDP estimate

Published 13/07/2017, 15:40
© Reuters.  UK statistics agency proposes scrapping earliest GDP estimate

LONDON (Reuters) - Britain's statistics agency has proposed scrapping its earliest estimate of how the economy fares each calendar quarter, saying it instead wants to publish monthly figures and a broader quarterly measure released two weeks later than currently.

Britain is usually the fastest major advanced economy to announce gross domestic product data. Its preliminary releases appear around four weeks after the end of each calendar quarter, followed by more detailed estimates eight and 13 weeks later.

After the financial crisis some analysts criticised the preliminary GDP estimate for missing ups and downs in the economy, though more recent revisions have been smaller.

On Thursday the Office for National Statistics said it would consult the public over merging its first two estimates of calendar-quarter GDP into a single release, which would be released six weeks after the end of each quarter.

The change would come into effect next year.

"It's important for (the) ONS to strike a balance between the timeliness of GDP estimates to aid policymakers and the reliability of the available data - and therefore reduce the potential for significant revisions," the ONS's director of economic statistics, Nick Vaughan, said.

The current preliminary GDP estimates contain less than half the data on economic output that goes into the final estimate, and none of the data on spending such as business investment, or income like household earnings.

The new estimate would include 80 percent of output data, 60 percent of expenditure data and 40 percent of income data.

In addition the ONS said it wanted to bring forward the monthly publication of data on output in Britain's huge services sector which would be released alongside figures on industrial output, overseas trade and construction.

The change would allow the ONS to produce GDP estimates for individual months and rolling three-month periods for the first time, though it would mean initial estimates of growth in complete calendar quarters appearing later than at present.

A consultation on the proposals will run until Sept. 14, and if approved will take effect from July 2018.

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