Trade facts turn into guesswork
Publication of official monthly statistics monitoring the balance of trade between Britain and its EC partners will be suspended from January. The Central Statistical Office (CSO) expects a delay of five or six months before it is satisfied that the new method of collecting data is accurate.
From 1 January, larger trading companies will submit import and export data to the Customs as part of a detailed monthly VAT return required by EC regulations. Firms need to make substantial changes to their information and computer systems, and technology troubles could postpone publication of the figures beyond next summer.
The delay will leave a gaping hole in the monthly statistics, since more than half Britain's trade is with EC states. Treasury and other ministers will have access to the new, unpublished statistics from February, but they will need to be treated with caution until their reliability is known.
Euro-sceptic Austin Mitchell, Labour MP for Great Grimsby, said last night that lack of adequate information about the balance of trade could be disastrous. 'I can understand why the Government might want to cover up the horrendous trade mess we are in for six months, but it is going to create tremendous uncertainty and possibly panic. How can you expect the markets to behave responsibly without accurate information?'
Robin Lind, an economist at the stockbrokers UBS Phillips & Drew, said that the absence of complete figures would coincide with a forecast increase in the monthly deficit from pounds 1bn to pounds 2bn or more. 'I don't think it has been taken on board in the City that the absence of these statistics will happen at quite a sensitive time.'
The raw data on which trade figures are currently based is supplied on documentation which accompanies international shipments and is noted at ports by Customs. Removal of Customs barriers within the EC means the information has to be collected direct from importers and exporters. Around 30,000 companies, whose imports and exports account for 97 per cent of trade with the EC, will be required to make detailed monthly returns to Customs, including information which determines whether they or their client pays VAT.
They are expected to submit returns within 10 days of a month's end, using an electronic data link. Failure to provide the information could result in prosecution.
Customs officials have expressed concern that only one in 10 of firms has so far approached their offices for advice. A spokesman said all the companies affected should be fully aware of the change.
Ian Campbell, director-general of the Institute of Export, said: 'Not having any European trade figures for six months or more is going to make it extremely difficult to know whether we are achieving the extra sales within Europe under the single market which are vital to the future of our economy.'
The Treasury said yesterday that ministers regretted the need to suspend publication but did not expect economic policy to be impaired.
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