Select Committee on Treasury Minutes of Evidence

Examination of Witnesses (Questions 140 - 169)



  140. You told us this morning that you saw no evidence compelling enough, your words, to mount on inquiry but you told me in a written answer that you saw no evidence at all.
  (Miss Johnson) We have not seen any evidence that would lead us to think there has been a leak.

  141. So there is no evidence?
  (Miss Johnson) There is no evidence that would lead us to think there had been a leak because if we thought there had been a leak obviously we would have looked at the possibility of the Cabinet Office, as they do, instituting in the usual way a leak inquiry.

  142. If the entire City gets the rumour it is 5.5 and an hour later it is 5.5, what more evidence do you want?
  (Miss Johnson) Do you want to comment further?
  (Mr Goldsmith) I am no expert at what goes on in the smoke of markets but this sort of conversation does go on. We know that and I am sure you know that. What we did do, as I said earlier, was having heard of this rumour through the wires we then looked at the markets and movements in the markets at around the time that the rumour was purported to have started which was about 8.30 which was just an hour before the figures were actually published, and again markets oscillate and vacillate all the time, and the conclusions we were able to draw with the help of other people who had competences beyond those in our own office (but our own economists were involved as well) were that we could not conclude any movement in the market around that time was attributable to an improper leak of an official figure. As I then said, nonetheless although we could not see the need for, as the Minister said, the full scale inquiry to which she just referred, we have started having a look at our own procedures and processes in a belt and braces way but not on the basis that we had evidence there had been a leak, not at all. That has got to be made clear.
  (Miss Johnson) It is to make sure that the internal arrangements at the ONS are absolutely up to scratch. We believe they are but we are keen to make sure that they are.

  143. When a dealer is quoted in the Telegraph as saying: "It was carnage. I received an e-mail saying the earnings figure was 5.5 per cent. The market got the hell kicked out of it." Is that not evidence?
  (Mr Goldsmith) I think it is anecdote rather than evidence. We talked to people in the Treasury, we talked to our own economists, we talked to people at LIFFE, and all the conclusions that those conversations led us to were that the market had not moved as a result of improper leakage.

Mr Davey

  144. Can I return for a moment to the scope of National Statistics. You said in the framework that you will publish your initial decisions on what should be in there but that will be up for review and there will be an evolutionary process. You have said with respect to the RPI that that will not be compiled by National Statistics. You have said on the floor of the House I believe that is because it is of special importance to the UK economy. Surely the argument is it is of special importance to the United Kingdom economy and therefore should be compiled by an independent body like National Statistics, not by the Chancellor?
  (Miss Johnson) Of course ONS are responsible for the compilation and indeed the presentation and publication of the index and all its sub-components as well. I would not want you in the last part of your question to go away with the impression that ONS do not actually compile and present and publish this particular vital economic indicator; they do. They of course take the lead as well in advising on methodological issues but the attraction—and I have to say I think this is a considerable attraction—is it has been a long-standing arrangement that it has been ultimately the responsibility of the Chancellor and remained under his ultimate authority. It is not a new arrangement. Quite the contrary, it is the carrying on of a long-standing existing arrangement but of course the Chancellor of the Exchequer is directly accountable to Parliament, also a point I made when we discussed this in the debate in October, and therefore to the public and to Parliament accountable for any decisions that are taken on the scope or the definition of RPI.

  145. If it is compiled by ONS and compiled by National Statistics and you are celebrating your new framework as the best way to establish and confirm people's faith in the key statistics, surely the logic of your move is to make sure that the RPI is guaranteed not by the Chancellor but by the Statistics Commission?
  (Miss Johnson) This provides, in fact, a more direct link with accountability and the ability to raise questions directly to the Chancellor through the House of Commons than any other accountability mechanism and it is just because of its importance that this seems to be the right accountability mechanism. That is why it has been a long-standing arrangement that this is the way in which RPI has been provided for. Indeed, as I say, ONS basically compile the statistic and indeed advise on the methodological aspects of it too, so that it is ultimately a creature produced by ONS.

  146. You are not suggesting through that logic, are you, that for the statistics that will be compiled by National Statistics and guaranteed by the Statistics Commission, Parliament will have less accountability with respect to those than they will the RPI? Will the RPI have a higher level of accountability than the other statistics?
  (Miss Johnson) Because the Chancellor is so often at the House of Commons and so available to be engaged in debate in the House obviously there is the possibility that at any time RPI could become the subject of debate in a way which I would not really anticipate happening with National Statistics across the piece because individual statistics will not be picked out in quite the same way. There will be a wider arrangement and an annual reporting arrangement rather than the possibility of debates at other times and questions at other times of the Chancellor and it is because this is such an important economic indicator that it has always been treated in this way.

Mrs Blackman

  147. Just going back a minute, Minister, to Jim Cousins' line of questioning in relation to the survey done by the Manchester Low Pay Unit. I know you have promised to provide him with a note but there is a discrepancy between the actual vacancies on display and the official vacancy statistics. The paper submitted by the Low Pay Unit to this Committee raises a number of different issues relating to that discrepancy. I wonder if you would be prepared in addition to responding to Jim Cousins' specific issue, to respond to the general and specific issues raised in this paper if we provide you with a copy.
  (Miss Johnson) I have not seen that paper. I take issue with your word "discrepancies".

  148. Apparent discrepancies.
  (Miss Johnson) Exactly. There are different sets of figures produced unquestionably on a different basis.

  149. I accept that.
  (Miss Johnson) And we will supply some more information about that. We are, I am sure, happy to take that away and endeavour to provide any elucidation we can to this Committee in relation to the questions raised within them, but without seeing them I cannot guarantee we can deal with each and every one.

  Mrs Blackman: That is why I am suggesting that we provide you with a paper and I do mean "apparent" discrepancies because there may well be explanations for different arguments used and different submissions used in this particular paper that you would wish to respond to anyway.

Mr Ruffley

  150. Minister, what possible reasons have you got for ever opposing the idea that we put these new arrangements on a statutory footing? What possible objections to putting it on a statutory footing have you got?
  (Miss Johnson) I think two-fold really. First of all, I am seeking to achieve something that actually works and brings about a practical change and delivers something and I think these arrangements will do that but we have said that we will look in a couple of years and review how successful this has been and if we had any concerns at that time we could, of course, decide to make a response to those, whether that be legislation or some other response. Also I think I would say after a very long night in the House of Commons one can only reflect on the pressures on Parliamentary time for legislation and whether, in fact, we can achieve the results we believe we can achieve well without going to primary legislation and whether in fact it is a good idea to go down that path of primary legislation where, as we all know, there is a bit of a waiting list to get on to primary legislation likely to cause delay in setting up the arrangements because there is already a queue of legislation passing through the House of Commons.

  151. You probably did not realise, Economic Secretary, in some of your answers today you have made a powerful case for the need for these new arrangements to be put on a statutory footing because more questions were raised by some of your answers than the questions actually put. Let me just ask you this: if in the existing ONS statistics, the existing set of time series we have got for everything, a Minister wants to remove one of those series, the Commission can raise an eyebrow or it may object, but the Minister decides if he or she wishes to remove something from that series. Is that correct?
  (Miss Johnson) I hoped I had made it completely plain, Sir Michael, in response to Michael Fallon's question, that I think it is inconceivable that a Minister would be able to delete something from National Statistics. The only situation in which I could envisage something been removed from National Statistics would be the concern about the quality of the data set which might lead to temporary suspension or possibly permanent removal.

  152. Who would define that quality?
  (Miss Johnson) That is a matter for the National Statistician because it will be a question of the statistical quality of the data.

  153. You are saying that a Minister could not make a decision to delete something without the agreement of the National Statistician?
  (Miss Johnson) I am sorry, I missed the word?

  154. Delete.
  (Miss Johnson) I am saying I do not see any scope—

  155. Can I ask the question. It is very important we get this right, with respect. If a Minister wishes to delete something from the statistics, you are saying the Minister cannot do that without the agreement of the National Statistician?
  (Miss Johnson) I am saying I do not see the role for the Minister doing it, full stop. There is no scope for political interference in terms of deleting statistics.

  156. You are saying it can never happen. So you are now saying a Minister could not delete an item or a series?
  (Miss Johnson) Yes.

  157. Could not ever?
  (Miss Johnson) Insofar as it is possible to describe "ever", yes but I do not foresee it ever happening.

  158. You do not foresee it ever happening. But if it were to happen I take it from your earlier responses that could not happen without the agreement of the National Statistician where there was a disagreement about quality and the deletion was for reasons of concern about quality?
  (Miss Johnson) I cannot envisage how that would happen.

  159. I could.
  (Miss Johnson) I admit to not being a particularly statistically literate Minister but there are few Ministers in a position to argue with the professional quality as defined by a professional statistician be it their own departmental one or in this case the National Statistician. I do not see there could be a debate of equals there about quality. I would always expect the initiative to come from a professional because that is what we hire them for to say what the quality of that particular data set was and if they had concerns about it to come forward at the earliest possible time and say they believed it should be suspended or removed. I cannot envisage the situation you spoke about ever arising.

  160. So a Minister could not make a deletion?
  (Miss Johnson) That is what I think.

  161. That is helpful. The second question, following on from Mr Davey's and Mr Fallon's questions, if the Commission strongly recommended that class size and hospital waiting list figures should be included in the statistics, and the relevant Minister said, " No, I do not want them", just for clarification, you are saying that the recommendation of the Commission would be made public, the reasons the Minister had for not wishing those series to be included would be given but that is all that would happen?
  (Miss Johnson) I am saying that any role that the Commission had in advising in some way would presumably be their decision, but it would normally be made public and that any response that a Minister was making to any advice that had been offered by the Commission would be made public in response.

  162. But if this new statistical service is to be truly independent, all you are saying to us is that if it makes a recommendation on the inclusion of class sizes or hospital waiting lists and the Minister does not like it very much he could say No and that is it. Would it not be more sensible to put all this onto a statutory footing, particularly in relation to your earlier question about deletion of statistics by Ministers. Would we not all feel much more comfortable if we could have this in black and white in the statute so we all know where we stand and have a truly independent statistical service?
  (Miss Johnson) I cannot comment for you, Mr Ruffley, about what you would feel more comfortable with. What I can say is what I believe to be the case and what I think is best in the situation we are in which is that we have a statistical service which has had no major overhaul for 30 years. We have undertaken that overhaul and we have the possibility, and indeed we are now making good progress towards developing something which has an integrity and a credibility which I believe a National Statistics service must have if it is to enjoy the public confidence which our service (only in some areas) to a degree has not enjoyed to the degree it should have enjoyed in recent times partly, or largely, because of the result of the way in which politicians and politicians from the previous Government engaged in meddling in some of those figures and the abuse of some of those figures. I think that we have made very good progress and we are making very good progress. I am afraid I am a very practical person and I believe that the outcomes we should be trying to seek as politicians on behalf of the public are very practical outcomes. I think the arrangements we are making here, the consultation and discussion, the massive support we have had for that, the very large change we are making, the appointment of the National Statistician and the Commission and the arrangements we are making we have been discussing this morning all point to the fact that we are making a major change very successfully and it is doing that successfully which is the proof of the pudding and I believe the proof of the pudding is well demonstrated by the progress that we have made to date and I do not believe that some alternative method would have been a better one. Indeed, I think the results show this is the best possible route we could have gone down.

  163. I would just close by saying, first of all, that I think Conservative Members would refute your utterly absurd suggestion that there was political interference. You have got a very bad case of selective amnesia if you do not think there has been more political interference by this Government in the workings and presentation of statistics than we have ever seen in the 18 years before 1997. Be that as it may, Minister, could I just say we will all be watching.
  (Miss Johnson) I think 30 changes in the unemployment count over 18 years is an impressive record by way of an attempt to discredit the standing of statistics at the time and did very much to contribute to a failure of credibility with the public generally about the information which government then offered. We are certainly tackling that problem and I think we are tackling it very effectively.

Mr Cousins

  164. On a personal note could I say I slightly regret explicit references to party politics. I would like to think an observer coming to these proceedings might find it quite hard to judge what the party loyalties of individual particular members of the Committee might be. That is the proper function and conduct of a parliamentary Select Committee and that would be understood by both the members and by the Ministers, as I am sure you do. Because I am of a mind to take your view that openness is one of the most powerful disciplines that can be asserted in the conduct of public affairs, will it be the case that no final decision will be taken about what the scope of statistics that will be included in this procedure will be until the Statistical Commission is in place and able to exercise its proper patrolling of due process and the new Chief Statistician is also in place and able to contribute to the debates and discussions on that point?
  (Miss Johnson) It may be that that will be case but I do not think I would give a guarantee that that will be the case. However, I would not be concerned about it because the framework will be coupled up with an initial list of statistics that will be included within the scope of National Statistics. For all sorts of reasons because there are many things going on and indeed ONS perpetually look at the range of statistics and how they ought to be developed and modified and which indicators are the ones we ought to be going on. I see for all those and other reasons that list evolving over time. I see it as a start of a fairly organic process, if you will, rather than as a one-off, this is it, and that is the close of the discussion, as it were. I do not think that is the way it will be because I think naturally if we are to get at the best we have to continually see these things evolve and be perfected to reflect changes in our society which statistics have to all the time to reflect if they are to be useful and contemporary in what they are reflecting back to us. I think those things are very important. I am, of course, always delighted to witness the Select Committee operating in the non-party political manner which you have just outlined, but what I would say is I am here as a politician rather than as a member of the Select Committee and I cannot alter that fact because I am here as a Minister in front of you this morning, and in relation to the points about the previous Government I think it is a fact that it is part of the setting in which the changes which we are now making have to be seen and so I make no apology for setting them in that historical context.

Mr Fallon

  165. You spoke of progress here. The Royal Statistical Society called your proposals "deeply flawed". Do you not accept this concern in the wider community when you have promised an independent service when in the end it turns out that you are going to define the statistics that are going to be national, subject to the advice of the Commission that you have appointed on the basis of a framework that is not statutory. To call that an independent service is double speak, is it not?
  (Miss Johnson) No, it is not. We have got a National Statistician. We have got open and transparent arrangements that support integrity and freedom from political inference and which endeavour to guarantee the highest professional standards. I respect the views of the Royal Statistical Society, of course, but I do not think they have got this particular comment right. It is not the only comment they have made, I have to say, it is just one comment you are quoting and they have made other less critical, if you will, comments and I hope that we will persuade them very soon that that comment, if true at the time, is no longer true of the arrangements that we are putting in place.


  166. Could I just finally confirm that you will be writing in response particularly to Jim Cousins' specific points and Liz Blackman's in as far as you are able to do that?
  (Miss Johnson) Indeed.

  167. Minister, you will, I am sure, have picked up the frustration of the Committee which has focused particularly on the delays and continuing uncertainty about the publication of the Framework Document and I am sure you will understand we will therefore need to see you again once that has been published.
  (Miss Johnson) Indeed, I will be delighted to come and see you when it has been published. I have absolutely no problem. Indeed, I could not say no in any event but I will be delighted to come and discuss that with you once it is published.

  168. We will be meeting quite often because on 5 April you are coming to see us.
  (Miss Johnson) Indeed I am, on the gilts inquiry, DMO.

  169. In the meantime I hope you have some sleep!
  (Miss Johnson) Indeed, and can I wish other members of this Committee the same?

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