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Saturday 29 January 2011
Letters: Calculating GDP
How we work out the GDP
Hamish McRae ("Don't believe the merchants of doom", 26 January) casts doubt on the reliability of the estimate by the Office for National Statistics that the UK economy contracted by 0.5 per cent in the final quarter of 2010. He is right to point out there is a significant margin of error in this estimate of Gross Domestic Product growth. But some of his other contentions are misleading, if not wrong.
Let me set out some of the real basis for the GDP estimate, and why it can be trusted.
Because the preliminary GDP estimate is released only about three weeks after the end of the quarter, it is always based on incomplete information, typically less than half of the total required. In particular, there is little news for the third month, in this case December.
We normally estimate the missing information using standard statistical techniques, and also other sources of evidence. Accordingly, there is a reliable basis of our estimate that the economy contracted by 0.5 per cent and that it would have been broadly flat had it not been for the impact of bad weather.
The resulting preliminary estimate has a good track record. The average revision to the preliminary estimate is usually within the range +/- 0.2 percentage points.
As ONS has made clear, the margin of error may be a bit higher this quarter, but nothing which would make the estimate unreliable. ONS put additional resources into checking December, with particular scrutiny of sectors such as hotels and restaurants, and transport where the weather was likely to have a significant impact. We took data on for the third month at a later stage than usual, and investigated individual responses more promptly.
Mr McRae is incorrect to state that the figures "may be leaning too heavily on data from the early part of the month when disruption was most severe". He is right that the estimate for December is based on partial data; as usual, about 30 to 35 per cent of responses were available at that stage. But that data related to the whole of the month of December.
He refers to other estimates of growth, such as the projections from NIESR. These face similar problems in estimating what happened in December. The difference is that we have some partial basis in fact for our figure.
Overall, the initial estimate of GDP is certainly imperfect but that doesn't stop it being a key, reliable piece of evidence.
Chief Economist, Office for National Statistics,
Forests belong to the people
Previous attempts to sell publicly owned forests foundered. Public protest proved that some issues confound even the most rigorous of economic arguments. But this coalition government is proposing to transfer our forests to a broader range of owners under the guise of its small state, big society agenda ("Safeguard the wood and the trees", 28 January).
In reality, it looks like a privatisation policy born of Tory ideology from an earlier era. With only up to 8 per cent of woodland being made available to charities and to community groups it is the private sector that will benefit most from this proposal.
But private companies will want a return on their investment. They will want incentives, grants and tax breaks to encourage them to buy or lease our woodland. And they will want a relaxation of planning regimes to enable them to create holiday parks, caravan sites and theme parks that could be to the detriment of biodiversity and wider environmental interests. If the government's plans go ahead, people who care about Britain's historic woodland heritage will have every right to expect a forestry regulator who will put the environment and the interests of the public first.
Executive Director, Chartered Institution of Water and Environmental Management,
So, the Lib Dems are considering voting against the forest sell-off. For me, this could be their last chance to redeem themselves, especially since we are talking about such a relatively paltry revenue sum.
I am fed up spending hours of my time trying to write logical and reasoned letters to my MP (Conservative.) What I get in return is standard letters urging me to be patient and not to worry but answering none of my questions nor even showing any understanding of the issues.
I've tried to explain to him about the threat to the wildlife in our forest, some of which is only just hanging on even now. I've complained about the on-going sale of several woodlands with no thought whatever for any wildlife they may contain. My MP certainly didn't try to provide any evidence that my assertion was wrong.
We can't even find out who some of these woods have been sold to. How can I believe that if this forest is sold, our wildlife will fare any better. One of the creatures which is not endangered in our forest is Rattus Norvegicus and I smell a very large one at the centre of this whole business.
Royal Forest of Dean, Coleford, Gloucestershire
We wonder how many of your readers realise that the Forestry Commission has already been instructed to sell some 40,000 hectares of woodland in England over the next four years; which amounts to about 15 per cent of the public forest estate. The Treasury hopes to raise about £100m from the sale.
At a time when there is increasing recognition of the valuable economic, social and environmental benefits provided by our sustainably managed forests, it is ludicrous that the Government should be squandering this vital national resource, Britain being among the least-wooded countries in Europe.
Although the Forestry Commission has not escaped occasional criticism over the years, its stewardship has been a force for good since its establishment in 1919. The Government seems to have overlooked the fact that two of the Forestry Commission's key objectives are "to protect Britain's forests and woodlands" and "to expand Britain's forest area".
A concentrated effort is required by all with an interest in Britain's forests to secure their future for generations.
Executive Director, United Kingdom Forest Products Association,
Checking care with great care
In Johann Hari's thought-provoking article "The plan to solve our care crisis" (26 January), there are, nevertheless, some errors and inaccuracies.
My main concern is that he is wrong about the way we at the Care Quality Commission react to concerns from the public. He says "if you try to contact the CQC ... they tell you to go away". This is not true. Our website makes clear that we want to hear people's views and concerns about care. This information is passed to our inspectors, helps them build a picture of care homes and can act as triggers for inspections.
He says that homes that were shut down one day reopened the next day. This a very rare occurrence and, had he asked us, we would have told him the reasons this can happen, one of which is that it can be a means by which we can take action to secure improvements.
He refers disparagingly to "light-touch regulation"; again, as we would have explained we take a risk-based approach that involves much more than homes simply ticking boxes. He quotes Judy Downey as saying "inspections of care homes are basically being abolished"; that is not true, because inspections remain a fundamental part of our regulatory activity.
We are as concerned as Johann about standards of care. Our purpose is to prevent harm and ensure that people who experience care services are safe and treated with dignity.
Dame Jo Williams
Chair, Care Quality Commission,
Johann Hari suggests that the ideal is for every elderly person to stay in their own home with help from outside agencies. That is indeed good if the person really wants that. But it means that they will be spending a lot of time waiting for someone to come and get them up, help them to shower and provide meals.
The amount of conversation they get will depend on how many other people the carer has to visit. For the remaining waking hours, unless they are lucky, they will be alone. What sort of independence is that?
My mother was in an excellent care home in Kirk Hammerton. She could get up, or be got up, whenever she liked. She could eat meals with the other residents, or on her own. In fact, she could choose how she wanted her day to be and she had company whenever it suited her. She said that going there was the best thing that she did. Perhaps the important word here is "excellent".
I can understand Johann Hari's disgust at the way in which his grandmother was treated, but I would not like readers to get the impression that every care home or staff is uncaring.
Stammering genes found
I was delighted to read that Dr Stephen, headmaster of St Paul's, overcame his stammer and glad that he has pointed out how difficult life can be when you stammer (Education, 27 January). But he is wrong to say, "The truth is that a stammer is psychological, not physiological". By saying stammering is psychological, he helps perpetuate the false myth that it is somehow our own fault.
He, you, and your readers should know that stammering is a symptom of a condition in which the brain's neural circuits for speech have not wired normally. In addition, last year researchers said three genes have been identified as a source of stammering.
Why was the young woman illustrating your spread-betting article (26 January) wearing so little? Had she just lost her shirt?
Perspectives on global food supply
No connection with GM crops
In Dominic Lawson's polemic against food faddism (25 January), he states, inter alia, "They believe that so-called "non-organic food" – in reality there is no such thing – gives people cancer; yet since 1950, as pesticides and industrial farming have taken an increasing role in food production, stomach cancer rates have actually declined by 60 per cent in Western countries".
Both statements in the latter part of this sentence are true but they are almost certainly not connected. The most plausible candidates for the (global) decline in stomach cancer rates are a reduction in the frequency of infection with the bacterium (Helicobacter pylori), which has been shown to play a causal role in the most common form of stomach cancer, and an improved diet with higher intake of fruit and vegetables.
There is persuasive evidence that high-salt diets and high levels of nitrate in food both increase the risk of developing stomach cancer. However distasteful it may be to Mr Lawson, the decline in stomach cancer rates probably owes a significant amount to healthier eating habits.
Although I share Mr Lawson's scepticism about the claims made for "organic" foods, it seems he has gone beyond the evidence in invoking a specific cancer to back his arguments.
Help countries help themselves
"The era of cheap food is over", is not where the emphasis should lie on a debate about global food provision ("Food inflation is only going to get worse in the future, warn scientists", 25 January). There is already enough food to feed the world. Yet developed countries remain wasteful, and the world's poor remain vulnerable as a result of policies that focus on export-led agriculture to feed us.
There is an urgent need to focus on policies that help poor communities feed themselves, protect their own natural resources and create businesses that last.
We were appalled that the report rejected "the idea that nations must become self-sufficient in food". This should be shocking to anyone who wants to reduce poverty. It shocked us.
Dr Philip Goodwin
Chief Executive, Tree Aid, Bristol
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