MPs pile on pressure for statistics chief to resign

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The Independent Online
DR TIM HOLT, director of the Office of National Statistics, was under increasing pressure to quit yesterday when MPs criticised management failings at the Government agency.

The Committee claimed the ONS was poorly-structured and under-funded and recommended a wide-ranging shake-up of the agency.

The report stopped short of directly criticising Dr Holt, already under fire over the recent fiasco over official average earnings data. But the report noted: "In view of the many challenges facing the ONS, strong leadership, both from its director and ministers, is vital".

According to the Committee, the ONS has failed to meet the needs of many of its customers and "several aspects of the ONS's performance to date indicate a lack of strategic direction". The Committee also raised concerns about the structure of the ONS, saying that the ONS director had insufficient managerial power, and that the agency ought to be more independent from government.

The critical report will increase the pressure on Dr Holt to stand aside after October's controversial revisions to average earnings numbers, a key indicator used by the Bank of England when setting interest rates.

The Bank and the Treasury were both said to be furious after the ONS revised the numbers twice in the space of a fortnight. The revisions removed the surge in earnings at the beginning of the year that prompted the Bank to raise rates in June.

ONS insiders are now privately sceptical Dr Holt will continue to head up the agency next year.

Sir Peter Lloyd MP, chair of the sub-committee which conducted the investigation into the ONS, said: "None of us under-estimate the difficulties Tim Holt faced in pulling together different organisations into the ONS with the budget he had. I think the time to say whether the ONS has good management or not is when it has been given an effective structure. Either the management, the structure or the money haven't produced the dynamism they ought to".

The Bank of England also came in for sharp criticism in the report. The Governor of the Bank last night took the unusual step of formally complaining to the Committee after his deputy came under fire for his role in the earnings fiasco.

The Treasury Committee, chaired by the Labour MP Giles Radice, expressed two key concerns about the role played by the Bank in the earnings mix- up.

Sir Peter said he was "puzzled" the Bank only raised concerns about the earnings figures the day before publication. According to the Committee, the Bank had been aware of the programme of work which led to controversial revisions to the figures for many months.

The Committee also raised concerns about Mr King's involvement in the subsequent Treasury-initiated review .

According to Sir Peter, the Bank was a "disgruntled customer", and, as such, it was inappropriate for Mr King to oversee the review.

In a letter to Mr Radice released last night, Eddie George, Bank governor, argued that the Committee had misunderstood Mr King's role in the review. "It is not clear to me that there is anything inappropriate about this structure or Mervyn King's position,"he said.

Outlook, page 21

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