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5.40 pm
Sir Peter Lloyd (Fareham): I am grateful to the right hon. Member for North Durham (Mr. Radice) for his kind words about the Sub-Committee report, and for selecting some of the most significant points.
Although, alas, I am no longer a member of the Select Committee on the Treasury--which the right hon. Gentleman chairs with tolerance and skill--I was lucky enough to be the Chairman of the Sub-Committee which produced the report on the Office for National Statistics. I am sure that I speak for my erstwhile colleagues in expressing gratitude for the help that we received from the expert individuals and organisations that gave us written and oral evidence, and in saying a word in appreciation of our astute and immensely energetic Clerk, Jennifer Long. [Hon. Members: "Hear, hear."] I thought that members of the Committee would want to cheer that.
I welcome the Economic Secretary to the Treasury to her post, and I wish her well. Although I shall be critical of the Government, I realise that she arrived well after the die had been cast, and that the Government's shortcomings are not hers. I hope that she will be able to remedy some of them in the months ahead.
It was no accident that the Sub-Committee, which was set up last year to look in turn at all the Departments and agencies for which the Treasury is responsible, made the ONS the subject of its first inquiry. It was plain to us that sound, comprehensive statistical data which everyone could understand and rely on were increasingly essential for good government, and that the services provided by the ONS and the Government's statistical service were central to effective policy formation by Ministers, and to the ability of the public at large--as well as Ministers themselves--to judge their success.
It seems that the Green Paper, "Statistics: A Matter of Trust" reflected the same view, and that the Government were determined to make a fundamental change in the structure of statistical services. We hastened our inquiry in the summer of 1998 with the intention not of pre-empting the Government's Green Paper consultation but--having listened to our expert witnesses--of providing a set of criteria which we felt the new arrangements that were to be produced by the Government last autumn should satisfy.
We need not have hurried. The White Paper was finally published only yesterday--a year later, on the last day of the recess and one day before this debate, making it certain that most Members will not have had a chance to read it and that none will have had the opportunity to study it. It is deplorable that the Government should have contrived to ensure that Members had the minimum of opportunity to reflect on the White Paper before the one day of debate on the subject. The timing of the publication, and of the debate, is effectively in the
Government's hands. It is as if the Government are ashamed of their White Paper and do not want it talked about.
Having read the White Paper, I am not clear why it should have taken so long to produce. It sticks more closely to the status quo than the Green Paper appeared to presage. Perhaps the delay and the disappointing content are both explained by the difficulty of finding agreement within Government for the more thoroughgoing change that is required. At this point--time to study it apart--it is difficult to know, as the right hon. Member for North Durham said, what to make of the contents, as much waits to be spelt out in another paper, "The Framework for National Statistics".
A number of major points need to be made now in the light of the Sub-Committee's recommendations and the existing White Paper. The proposal for an independent statistics commission is certainly welcome, as far as it goes. It makes sense that such a commission should be comparatively small and coherent but--apart from the important task of monitoring the methodology and standards of ONS outputs--its role appears to be solely advisory. It may be more wieldy, but it seems to be little different from the advisory committee which the Government have recently disbanded. Perhaps the Minister will tell the House why the Government disbanded the advisory committee when they did. Would it not have been valuable to have the informed comment of that committee on the White Paper? At a time when the Government needed the committee's advice, they got rid of it.
The Sub-Committee set much store by the recommendation that the commission, rather than Minsters, should decide what statistics should be included in the scope of national statistics if the desired level of integrity--real and perceived--for important statistical series is to be achieved. Hospital waiting lists and school league tables are obvious candidates, as so much store is set by them in terms of policy formation and the public's judgment of the Government. The White Paper makes it plain that Ministers will continue to have the last word.
Mr. Oliver Heald (North-East Hertfordshire):
Does my right hon. Friend agree that what he says is relevant to issues such as police numbers? The integrity of the statistics is vital and there is a huge cloud over the Home Secretary's recent speech.
Sir Peter Lloyd:
I agree with my hon. Friend that all Government statistics should be absolutely reliable, although however reliable they are--even if they are produced entirely honestly and clearly and launched in that way by the ONS--politicians on both sides will cherry-pick them to bolster their argument. One sees that at party conferences sometimes, and my hon. Friend has picked a good example.
We recommended in particular that, because it is of such central significance, the retail prices index should cease to be the sole responsibility of the Chancellor and should be a candidate for ONS management. However, the Government made it clear in an earlier response that the RPI was too important and too widely used for the Chancellor to let it go. That reply makes nonsense of pious rhetoric to the effect that key national statistics should be seen to be expertly and independently produced. The RPI is apparently too key. If it needs the Chancellor's
protection, why is not the earnings index, which is so significant for the Bank of England when it sets interest rates? The Chancellor was rightly bold when he passed responsibility for interest rates to the Bank of England. He should show the same qualities by passing responsibility for the RPI to the ONS in due course.
Mr. Oliver Letwin (West Dorset):
Does my right hon. Friend agree that the situation is slightly worse than that? If the Chancellor can manipulate the inflation figures that underlie his target, that target is in his own hands, so he is making nonsense of his policy of delegating monetary control to the Monetary Policy Committee.
Sir Peter Lloyd:
My hon. Friend makes an extraordinarily good point, with which I entirely agree. He will understand that I am trying to be as cross-party as possible and am sticking to supporting the recommendations of the Sub-Committee rather than laying on with a trowel the reasons why they are even better than some of us thought when we made them.
During its inquiries, the Sub-Committee became very aware that the director of the ONS and his senior colleagues had had a difficult task in building an effective organisation following the merger in 1996 of the Central Statistical Office, the Office of Population Censuses and Surveys and a range of responsibilities and statistical outputs from a number of Government Departments. We felt that the ONS had made commendable progress, but I should like to quote recommendation 48, which puts the issue in the proper context:
The Sub-Committee also expressed concern at the lack of strategic vision across the range of official statistics, which we mostly attribute to the organisational structure of the ONS. We feared that the White Paper might not deal with that issue, and our fears appear to be confirmed by yesterday's publication. That issue may be covered in the framework document, but the White Paper gives no grounds for optimism; nor does it encourage us to believe that we are moving beyond the Rayner view that official statistics should be provided primarily to meet the management needs of Government. The needs of local government and business are compelling and should be
far better served, not least by better coverage of the vast and growing service area. We recommended that the ONS should publish a document setting out the criteria that it will use to assess the competing demands of Government, local government and business. The Government may have it in mind to do that, and I hope that the Minister will confirm that point later.
As part of KPMG's efficiency review, it was commissioned to make a report. It recommended that great savings would be made by contracting out much of the collection of raw statistical data, releasing resources to improve the service generally and--importantly--releasing the demands on top management time which could then be devoted to strategic and customer concerns, both of which need more attention than they receive at present. Why did the Government not take KPMG's advice?
The Sub-Committee's most important and difficult recommendation is in paragraph 10. I shall read it in full so that its meaning is clear:
Elected Ministers must of course set policy, but it is in their interests--and certainly in the electorate's interest--that they have the best statistical assessments to help them find the ways to achieve policy goals. Those ways will not necessarily be the obvious ones, those most readily to hand or those to which Ministers committed themselves in opposition.
"We recognise that Dr Holt"--
the director--
"faces many difficulties arising from the newness of the organisation, the problems it has inherited and the limitations of the present governance structure. We believe that the combination of roles and responsibilities which the ONS Director is required to fulfil are, as presently constituted, more of a hindrance than a help in dealing with these problems. We recommend that the Government accord a high priority to ensuring that the 'Head of National Statistics'"--
the national statistician, as he will now be called--
"role is managerially workable and supported by sufficient powers to co-ordinate the production of official statistics as well as ensuring that the Head has the required freedom from political interference."
Alas, there is little sign in the White Paper that the Government have fully comprehended that problem. It looks increasingly as though the national statistician, like the director before him, will sit at the top of the ONS with the commission, to whom he is not directly responsible, looking over his shoulder. The ill-defined responsibility for the standards of statistical work done in Departments will continue, without the national statistician having the authority to act if and when necessary.
"Canadian Statistician Ivan Fellegi has argued that 'A key end objective is to help the public policy process to discern the relevant "policy levers" that are likely to be most effective in moving us toward the achievement of desirable social and economic objectives' and cautioned that 'We cannot assume that the traditional policy levers are necessarily the most important ones.' For example, he suggested that life expectancy might be affected as much by family income as by medical intervention. We asked Dr Holt, the Director of the ONS, about its role in identifying statistics which would improve understanding of a particular policy area. He replied that 'It is a perception that this aspect of Government statistics is not well developed' and that he expected the issue to be raised in the Green Paper consultation. We recommend that in its response to the Green Paper the Government shows how the independent expertise of the GSS and ONS can be better used to translate politically determined objectives into meaningful targets and indicators."
Everybody can think of examples of that. For example, the reliance on waiting list statistics which, even if accurate, may help to distort rather than improve the provision of health care, and the reliance on class sizes, in statistical form, as a key measure when evidence suggests that others are probably more relevant to raising educational standards and ensuring that educational budgets are spent most effectively.
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