Authority Chair, Sir Robert Chote, recently gave a speech at an event to launch the next five years of the Economic Statistics Centre of Excellence (ESCoE). Touching on the origins of the Centre, its successes and expectations for the future, he said the following:
Good afternoon everyone.
It is a great pleasure to be here and to have the opportunity to help celebrate the first five years of ESCoE and to launch the second. It is a particular pleasure to do so in such august company:
- I am delighted that Professor Rebecca Riley will continue to direct the Centre, having provided great leadership in its first phase and having with colleagues set out such a compelling vision for its next one.
- It is always a pleasure to share a platform with Charlie Bean, who in addition to providing the inspiration for the Centre in his eponymous review was a treasured colleague of mine at the OBR.
- And Ian is a treasured colleague today at the UK Statistics Authority, providing fantastic leadership for the ONS and for the official statistical system more broadly during a period of remarkable challenges and opportunities.
I have been asked to kick off proceedings by providing some brief background to the creation of the Centre and where it might contribute to some of the ongoing and emerging issues confronting the statistical system.
As I mentioned, the origins of the Centre go back to the review of economic statistics that George Osborne commissioned as Chancellor in 2015 and which Charlie kindly chaired. The purpose of the review was to look at how well the ONS was performing in measuring the rapidly evolving modern economy and to make recommendations for how it could do that better.
Charlie’s recommendations were commendably wide-reaching. They covered specific methodological issues, the need for greater agility, the need for greater focus on user needs, the need for improved governance, the need to exploit existing and new data better, the need to deploy new technology and techniques in doing so and the need simply to up its game in understanding and interrogating the data that it collects and communicates.
Judging from the conversations that I have had with stakeholders since becoming the chair of the Authority – and indeed when I was deciding whether to apply – the ONS has responded impressively to Charlie’s challenges, although there is more still to do – and doubtless always will be.
Responding to the review, the ONS fundamentally reviewed many of its internal and external processes. In addition to looking to move to double deflation for the National Accounts and placing a greater focus on deflators and the role of technology, the ONS invested in new surveys and made greater use of administrative data (such as using VAT data in the construction of the National Accounts). It developed Faster Indicators, including monthly GDP, and new techniques through the Data Science Campus.
In addition, the ONS re-booted its engagement with the academic community. It did so in a number of ways, including the appointment of ONS Fellows and the creation of the Economic Experts Working Group. But the most significant was the establishment of the Economic Statistics Centre of Excellence in 2017, hosted initially by NIESR and directed then as now by Rebecca.
The ambition was not just to bring about a step-change in the quantity and quality of research into economic measurement, which had become a relatively neglected field, but also:
- to help develop the next generation of academics in this area;
- to build wider and deeper links between academics and NSIs; and
- to forge closer collaborative links between academics and ONS staff.
I know that the ONS was delighted with the way in which ESCoE rose to this ambition and rapidly found its feet.
As the Centre moves into its second five years, now hosted at King’s, there are a number of areas in which its work is likely to contribute to the developing work of the statistical system here and abroad. For example:
- Intense work is under way internationally to develop the next vintage of statistical manuals, particularly the System of National Accounts and Balance of Payments Manual for 2025. This activity is well developed, but ESCoE’s work on environmental measures will help integrate these data with traditional economic statistics under those systems. The proposed work on labour accounts also ties directly into this agenda.
- The ‘Beyond GDP’ strand will be hugely informative in a world where population ageing and increased economic inactivity mean that an increasing share of output, in its broadest sense, may occur outside paid employment and the market economy. Along with the work on environmental measures, this will allow better informed debates on trade-offs between economic, environmental and social objectives.
- ESCoE will also contribute to the analysis and improvement of traditional economic measures. Projects on sub-national indicators, trade, productivity, microdata, prices and public sector measurement are all germane here and their inclusion in the first suite of projects demonstrates the value we place on pushing these forward.
Of course, if the last five years have taught us anything it is that unexpected challenges and demands can confront statistical systems out of the blue – as the pandemic, the inflationary consequences of the Ukraine crisis and the recent evolution of the labour market demonstrate. Like the ONS and the GSS more broadly, ESCoE will I am sure be nimble and imaginative in rising to these challenges and opportunities to the benefit both of the official statistical system and academic researchers, to the ultimate benefit of the public good. And I wish you all the best in doing that.