Retailers cry foul as economists question official data
Renewed doubts about the quality of official data surfaced yesterday as the Government postponed publication of figures on the housing market, and the latest data on retail sales met with incredulity from the industry and some economists.
A spokesman for HM Revenue & Customs (HMRC), responsible for the property market data, explained that statisticians and economists at HMRC thought that "something didn't sit right" in the data when they compared them with previous months' results, hence the decision to withhold the information.
It comes a fortnight after publication of Ministry of Justice data on repossessions was postponed for a week "due to a temporary problem with the computer system". The Liberal Democrats' Treasury spokesman, Vince Cable, said: "It seems strange that when figures are bad, they are also often late. If we are to have any confidence in government figures, we must know that they are fully independent. Late or inaccurate statistics only go to further undermine this Government's credibility."
Separately, the Office for National Statistics (ONS) reported that retail sales in the three months to July rose by 0.7 per cent and that "underlying growth in retail sales volumes remain positive". The ONS said that, between June and July, the volume of sales jumped by 0.8 per cent, "reflecting rises in all sectors". Such strong evidence would weaken the case for a cut in interest rates later this year, but monthly data is volatile, and the ONS series has become more so recently, with a sharp rise in May's sales data wiped out by a dramatic fall in June.
However, some cast more serious doubts on the figures. Stephen Robertson, director general of the British Retail Consortium (BRC), said: "Few retailers will recognise this positive picture. These ONS figures suggest July's total sales values were up 3.8 per cent on a year ago, well above the miserly 1.7 per cent shown by the BRC's figures ... It's hard to see what could produce the sales-growth boost ONS is reporting, or its finding that smaller retailers are outperforming larger ones. We respect the ONS's process, but this report doesn't seem to reflect the current retail reality."
The ONS maintains that the BRC's estimate "does not effectively reflect sales by small and medium businesses" and "does not include businesses in sectors which have shown relatively strong growth in recent periods. For example, the internet-only retailers of home entertainment and major food discount stores". Chains such as Aldi and Lidl have performed strongly during the downturn.
"Several data series are becoming unforecastable," said Ross Walker, an economist at RBS. "I don't think there is a great risk of a major policy error but it probably does mean that it increases the chances of an error. The bigger risk is it delays policy from becoming pre-emptive."
Decisions on interest rates, unusually finely balanced now, crucially depend on economic data. In a speech last month, the deputy governor of the Bank of England, Charlie Bean, pointed out the difficulties the Monetary Policy Committee (MPC) has in interpreting them when setting rates. Mr Bean said: "We don't even have a precise picture of the current state of the economy. As a result, controlling the economy has been likened to driving along a winding road looking only in the rear-view mirror. Indeed it's worse than that as we don't even have that good a view of where it has been in the past either. It is as if the rear window is also a bit misted up."
Mr Bean added that, while official numbers remained the "primary signposts", the MPC would also refer to the BRC, CBI Distributive Trades and Bank of England Regional Agents' survey evidence too. "The conformity of the picture given by the Distributive Trades survey with other potential indicators of spending, such as consumer confidence and the Agents' reports, have led us to place less weight on the official data on retail spending for the present," he said.
The ONS relocated from London to Newport in south Wales this year, leading to a large number of staff changes. The PCS union warned then that the move would "undermine the quality of the statistics".
- 1 Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
- 2 Prince held a Facebook Q&A and this is the only question he answered
- 3 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 4 35,000 walrus gather ashore on north-west Alaska beach 'for a rest'
- 5 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
Prince held a Facebook Q&A and this is the only question he answered
Brad Pitt, on the moment he completely lost his temper with Clint Eastwood's son
Cheryl Cole officially the 'most dangerous celebrity' on the internet
Ebola virus in the US: What are the symptoms, what is it and is there a cure?
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Should gay sex be illegal? 16% of Britons think so
Mark Reckless becomes second Tory MP to defect to Ukip in a month
Benefits 'smart cards' plan revealed by Iain Duncan Smith to stop claimants spending welfare money on alcohol
- < Previous
- Next >
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...
£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...
Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...