Regulator to review ONS GDP estimate process following surprise revision

investmentweek.co.uk:

'We will extend our review to cover similar issues relating to a wider set of national accounts measures as appropriate,' the OSR said.

Last week, the ONS found that UK GDP grew by 8.7% through 2021, much higher than the previous reported estimate of 7.6%, while 2020 GDP losses were revised from 11% to 10.4%.

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The new revisions place the UK at the top end for recovery among the G7 over the pandemic, as the economy grew 0.6% between 2019 and 2021 rather than shrinking 1.2%, moving it from last to third, behind only the US and Canada.

Mike Keoghan, director-general of economic statistics at the ONS, wrote to the Office for Statistics Regulation yesterday (6 September), requesting that it review the process behind how the ONS conducts its estimates.

In the letter, Keoghan asked the OSF to consider «best practices when dealing with sharp discontinuities in economic performance and how they are communicated».

«We also wish to explore potential means by which key data might be made available to the ONS earlier in the production cycle,» he added.

The review from the OSR will consider three areas: Quality assurance, potential improvements through enhanced access to data and communication around uncertainty and revisions to GDP estimates.

«We will extend our review to cover similar issues relating to a wider set of national accounts measures as appropriate,» the OSR said.

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Speaking to MPs yesterday, Bank of England governor Andrew Bailey said that while they were «big revisions», there was always «great uncertainty» over GDP data and the upwards shift reflected the economy's economic resilience.

Ed Humpherson,