ONS defends growth estimates

The Office of National Statistics was forced to defend its record again yesterday as it left its estimate for economic growth unrevised just days after the Bank of England has said it was wrong.

It stuck with its figure of 0.4 per cent for third quarter GDP growth, the slowest since early last year, despite claims by business groups it had overestimated the fall in manufacturing.

The ONS confirmed its estimate of a 1.0 per cent fall in manufacturing over the three months to September. Groups such as the Confederation of British Industry report factory output as slowing but still growing.

Statisticians at the ONS said their figures were based on a vastly greater number of companies that went into the private sector surveys. Fenella Maitland-Smithsaid: "There is no suggestion that the response rate was any worse than for any other month." She said the breakdown showed the fall was "widely based" with 11 of the 13 sub-sectors within manufacturing suffering a contraction.

Ms Maitland-Smith said the team had undertaken a serious look at whether it should revise up the figure. She said: "We are happy that this is as rigorous as any other national accounts department."

On Monday Rachel Lomax, one of the Bank's two deputy governors, said business surveys suggested that manufacturing output had continued to expand. She said: "The Monetary Policy Committee [which sets interest rates] judges that overall growth was a little higher in the third quarter than the official data currently indicate."

Mervyn King, the Bank's Governor, used his briefing at the launch of the quarterly inflation report this month to say the official figures were "hard to reconcile" with the private surveys.

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