Select Committee on Treasury Written Evidence

Supplementary memorandum from the Office for National Statistics

  In response to evidence given to the committee by the National Statistician on 28 January, additional information was requested on questions 1-5 below (numbers in square brackets provide a link to the transcript of oral evidence). The National Statistician also offered to provide additional evidence on the reliability associated with mid-year population estimates (listed here as question 6). ONS evidence on all these questions is as follows:

Question 1:   How many enumerators experienced verbal or physical abuse, in the course of their work? [Q245]

  A total of 34 incidents were reported in 2007 by ONS field staff collecting social survey information. For comparison, in that year ONS sent interviewers to visit approximately 340,000 addresses. Of these incidents, nine related to verbal or physical abuse, seven to dog or bug bites and 18 to vandalising of interviewer cars and theft from cars.

Question 2:   The proportion of the population who have ex-directory landlines. [Q251]

  In 2006, 90% of households had fixed line telephones[1] and, according to British Telecom, 48% of all landline users, including non-BT customers, are ex-directory.[2]

Question 3:   Further details about the methodology used in scaling [/calibrating the IPS estimates using] the Labour Force Survey (LFS). [Qs 261-267]

  Details of the methods used to calibrate International Passenger Survey (IPS) estimates using three year rolling averages from the LFS were published in advance of the release of the population estimates in 2007. The full details are in the paper "The Use of Calibration in Estimating International In-migration to UK Countries and the Regions of England" on the National Statistics website at:

  An overview of the uses made of LFS and IPS figures in making local estimates was provided at the same time and is at:

Methodological justification

(a)  Reducing bias

  The benefit of using the LFS is to distribute international migrants to English regions and Wales based on where they settled rather than relying on where they said they intended to live, when they responded to the IPS.

  In the IPS, arriving international migrants are asked for an intended destination within the UK. These answers give biased estimates for the distribution of in-migrants between the countries of the UK and the government office regions of England. Analysis of data from the IPS, the 2001 Census and the LFS showed that the country and region in which recent migrants actually lived in 2001 had a different distribution from that based on where migrants sampled in the IPS stated that they intended to live. Comparisons of IPS and LFS in other years also showed systematic differences since the mid-1990s.

  Additionally, since 2005, in-migrants in the IPS have been asked whether they intend to stay in their stated UK destination for the next 12 months or are likely to move on to a different area. The data for 2005 suggested that in-migrants who initially intended to stay in London, in particular, were more likely to settle elsewhere than those indicating they intended to stay elsewhere (18 and 7% moving on within a year, respectively).

(b)  Effect on precision of estimates

  An important consideration, in moving from one method to another, was to assess whether it would adversely affect the standard errors of the estimates at the country and region level. Figures A and B show the relative standard errors for estimates based on using data from the IPS for 2002 and 2004, comparing the old method with the new method of calibrating using the new methodology. These relative errors take account of the variability introduced because the LFS is a sample survey. These show that in ten out of the twelve areas shown, the relative errors were lower in both years using the new methodology. For London and the South East, the small relative increases in one or both years reflected a smaller estimate of migration (but no change in the absolute level of error).

Figure A


Figure B


  For reference, the numbers of contacts made with recent international in-migrants each year in the LFS (from the much larger number of people who are actually interviewed) are shown in Table A. Migrant numbers in the sample are dependent not only on the LFS sample size but also on the actual number of recent migrants in any area, which will fluctuate between areas and over time. The relatively low numbers in some areas in individual years reflects the relatively low number of migrants in those areas.

Table A

19992000 20012002 200320042005 2006
North East1118 1886 241924
North West4138 433361 376148
Yorkshire and the Humber75 505460 49579654
East Midlands2619 244541 424965
West Midlands4041 415337 463243
East6588 487272 466091
London190226 147219165 172167162
South East139121 106108112 9389108
South West5445 435367 457655
Wales715 191711 132013

  As indicated above, the method of calibration introduced in 2007 makes use of rolling three-year averages. The use of the three year averages is particularly important in providing a more robust indication of recent levels of settlers in the regions than figures for any single year or use of the IPS alone.

Estimation of migrants settling in local areas

  In distributing migrant numbers to local areas, no further LFS calibration of IPS figures is undertaken beyond that described above. The method of distribution varies by region and type of migrant (see Table B), and in one instance (non-student migrants to London) further use is made of the LFS three-year rolling averages. This is purely for distributing the calibrated London totals to intermediate geographies within London. In this instance, the further distribution of these numbers, from intermediate geographies down to individual London Boroughs is achieved using 2001 Census distributions.

Table B

Outside London: distributions of in-migrants
Wales/English region level:IPS + LFS in combination—calibration using one year
IPS and three year average LFS
Intermediate level (NMGi):IPS three year average
LA level:Census
London: distributions of non-student in-migrants
Wales/English region level:IPS + LFS in combination using calibration as above
Intermediate level (NMGi):LFS three year average
LA level:Census
London: distributions of student in-migrants
Wales/English region level:IPS + LFS in combination using calibration as above
Intermediate level (NMGi):N/A
LA level:Census
Distributions of out-migrants
Wales/English region level:IPS one year
Intermediate level (NMGo):IPS three year average
LA level:Propensity to migrate model
Source: "Frequently Asked Questions", published by ONS on 24 July at:

Question 4:   Clarification about the method used by CLG to allocate resources, including the predicted margin of error by 2011. [Qs 270-271]

  The Department for Communities and Local Government (CLG) have provided the information included at Annex A.

Question 5:   The outcome of the discussions between ONS and the relevant chief statistician about the methodology used by the NHS to allocate resources to PCTs, 2008-09. [Q 273]

  Advice to Department of Health ministers on the resource allocation formula for the NHS is provided by an independent committee, the Advisory Committee on Resource Allocation (ACRA).

  The Department of Health have provided information on the 2008-09 allocations, included at Annex B.

Question 6:   What is the margin of error in mid year population estimates and how much does it vary? [Q 258]

  Mid year population estimates are produced using the cohort component method which begins with population estimates by age based on the 2001 Census and rolls these forward for each subsequent year by adding births, subtracting deaths, adjusting for migration and ageing the population by a year.

  The Census results incorporated estimates of under-enumeration, based on a sample survey, the Census Coverage Survey (CCS), and for this reason are subject to sampling error. Figures indicating the margins of error as a result of this, at national and local levels, were published at: /census2001/annexa.asp

  These error estimates do not however incorporate the additional uncertainties associated with the adjustments made to the Census results for current population estimation purposes. These adjustments are described in Section 2 of the Local Authority Population Studies: Full report, available from:

  Births and deaths in the UK are registered and are assumed to be complete. So the main source of statistical uncertainty is associated with the international migration component. This uses Total International Migration (TIM), which is compiled from several sources of information. The principal source is information on the intentions of recent migrants sampled in the IPS, but account is also taken of groups not covered by the IPS, such as asylum seekers and those arriving from Ireland, and adjustments made for those who change their intentions. TIM estimates are distributed to local areas using additional sources (eg Labour Force Survey and Census). Survey estimates such as the IPS and LFS have known sampling errors. All sources also have non-sampling errors such as under-coverage. No single error measure is available to summarise this complex process.

  However, the sampling error of the main individual component, the IPS, is available. The effect on these sampling errors of using the LFS to calibrate country and regional distributions was described in the reply to Question 3. This analysis incorporated the effect of sampling variation in the LFS.

  In addition to sampling variation in any particular data source and year, the following needs to be taken into account in considering the overall margin of error in population estimates:

    —  Any residual discrepancies between Census and the rolled forward estimates (for example definitional differences, sampling and other errors in the Census estimates and sampling and other errors in the post-Census corrections). These are considered to be relatively small at national level, but may make a larger relative contribution to the limited number of local authority estimates where there were particular problems at Census.

    —  Accuracy of local migration estimates from the Census, used in distributing migrant estimates as described in Table B (for example due to differential levels of imputation and sampling errors in the imputed values).

    —  Changes since Census in the local authority distribution of migrants within intermediate areas (Table B indicates how these distributions are used).

    —  The cumulative effect of sampling and other errors in annual population estimates as we move further from the base Census year. As is standard practice following a Census, the size of these errors will be assessed using the 2011 Census and revisions made accordingly.

  These are complex issues and ONS have not published comprehensive estimates of the margins of error, as indicated to the Committee by the National Statistician.

International Passenger Survey (IPS)

  For 2005, the relative standard error for the total IPS in-migration estimate of 496,000 migrants was 4%. This gives a range of between 459,000 and 533,600 as the 95% confidence interval[5] for the IPS estimate of the number of migrants entering the UK during 2005.

  The relative standard error was 5% for the 2005 out-migration estimate of 328,000 migrants. This gives a range of 297,000 to 360,000 migrants as the corresponding 95% confidence interval.

  Further details of the effects of sampling error on the migration estimates by various characteristics are given in Table 4.2 at pages 31-32 of the Annual Reference Volume MN Series no. 32, International migration: Migrants entering or leaving the United Kingdom and England and Wales, 2005. This is available from:

  Entries in this table show that estimates based on the sampling of passengers on certain routes have much larger errors associated with them. For other tables in this publication, as a guide, the standard error for an estimated 1,000 migrants will be in the region of 40%. This reduces to about 10% for an estimate of 40,000 migrants. Thus, generally speaking, the larger the sample supporting a particular estimate, the smaller its sampling error.

4 March 2008

Annex A


  Formula Grant is a fixed amount set by the Spending Review that is then distributed to local authorities by Communities and Local Government. Allocations are no longer made on an annual basis, but are multi-year settlement allocations made at the beginning of the Spending Review period. For example, provisional allocations for 2008-09, 2009-10 and 2010-11 were announced in December 2007. Multi-year settlements have been welcomed by Local Government as they provide predictability and stability in the funding that is provided by Central Government.

  In order to provide these multi-year settlements, projections of population and the taxbase (number of Band D equivalent properties) are used as the main drivers. For all other indicators, the data remains the same in all years. Therefore, rather than using the mid-2006 estimates of population as the main measure of population in 2008-09, 2009-10 and 2010-11, the 2004-based sub-national population projections for 2008, 2009 and 2010 have been used.

  For each authority, the distribution takes into account the relative needs and potential to raise resources locally relative to all other authorities providing the same services. There is also a central allocation and a floor damping mechanism. There is no guaranteed amount of grant per head.

  The calculation of relative needs is based on mathematical formulae for each of the main services provided. For each formula, except for Highways Maintenance, Local Authority Education Functions and Capital Finance, the client group for the service is measured by the ONS sub-national population projections. Additional socio-economic, demographic and geographic factors are used to reflect the variations in need and costs.

  In addition, to be able to determine the relative needs amount from the relative needs formulae, the relative resources amount and the central allocation, the population projections are also used as part of the calculations.

  The final allocation of grant incorporates a floor damping mechanism. This sets a lower limit (floor) to all authorities change in grant from year to year. This means that authorities whose grant, after the relative needs amount, relative resource amount and central allocation has been calculated (referred to as grant before damping), is below this floor, receive an additional amount to ensure that they receive the floor. As this mechanism is self-financing, authorities whose grant before damping is above the lower limit have their grant scaled back. The decision on what floor levels are set is taken by Ministers.

  The revised 2004-based sub-national population projections published on the 27 September 2007 have been used as they were the most up-to-date data available when the calculations of the 2008-09, 2009-10 and 2010-11 settlement were undertaken in late 2007.

  It is not possible to quantify what difference there would be for individual authorities, had different population data been used in the distribution of formula grant. This is because different decisions may have been taken by Ministers on the methodology used and the level of floor damping; and no alternative population estimates are available for years later than 2006.

  However, at the overall England level, there would be no difference, as the amount of grant to be allocated would not change.

Annex B


  ACRA is reviewing the resource allocation formula for the NHS. They requested an extension to its work programme, which Ministers agreed to, meaning that it was not possible to implement the new formula for 2008-09 and still give the NHS sufficient time to plan for the year ahead. Therefore, it was decided that it was better to announce a one-year allocation to PCTs and allocate the following two years as soon as possible after ACRA had finished their work. The resource allocation formula for the NHS was frozen for 2008-09, no part of the formula was updated included populations, and every Primary Care Trust (PCT) received the same uplift to their budget of 5.5%. The formula was frozen to avoid changes in 2008-09 that may then have to be reversed in 2009-10 when the new formula is implemented.

  It is right to give ACRA additional time to finalise their work to ensure that they will produce a formula which is as robust as possible. An additional benefit of the delay in allocations for 2009-10 and 2010-11 is that we will be able to use the latest population projections which will be available in 2008. Allocations for 2009-10 and 2010-11 will be made to the NHS by summer 2008 and will use the most up-to-date population projections data available from the ONS.

1   ONS Omnibus Survey Back

2   Source: BBC News 24, Joining the ex-files, 11 July 2006, Back

3   The relative standard error is the ratio obtained by dividing the standard error of an estimate by the estimate itself. Back

4   The relative standard error is the ratio obtained by dividing the standard error of an estimate by the estimate itself. Back

5   If the survey were repeated many times under the same conditions, then 95% of intervals constructed in this way would contain the true value. Back

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