economic forum; tuesday 19 january 2016

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ONS Economic Forum – January 2016

09.45 Welcome

10.00 FDI and balance of payments

10.40 Update on ONS beta website

11.00 Refreshment break

11.30 What’s new

12.00 What’s next

12.30 Close

Agenda

2

Welcome

Jonathan Athow, Deputy National Statistician for Economic

Statistics

ONS Economic Forum

19 January 2016

3

Bean Interim Report

• Sir Charles Bean’s

interim report published

December 2015

• Final report due in next

couple of months

Five interim strategic recommendations

Refocus the culture of ONS towards better meeting user needs

Make the most of existing and new data

sources and the technologies for dealing

with them

Become better at understanding and interrogating data

Become more agile in the provision of statistics

that properly reflect the changing structure and characteristics of the

economy

Address established statistical limitations

Economics at ONS

• Increasing Openness,

Improving Capability

published December

2015

• Sets out some first steps

to address some of Sir

Charles Bean’s

recommendations

Economics at ONS (2)

Some key steps:

• Economic Forums in Manchester, Cardiff and Edinburgh, with plans

to include Belfast and Leeds in the summer.

• Improving the usability of the Virtual Micro-Date Laboratory (VML)

• Recruiting ONS Fellows – academics or other experts to work

alongside ONS teams to develop solutions.

• Launching a new recruitment exercise for economists

• Commissioned Prof. Nick Oulton to work on double deflation

• Increased use of now-casting – for example forthcoming timely

estimates of public sector productivity

• Improving the timeliness of key statistics, including household

income and associated inequality measures

• Developing Economics Statistics and Analysis Strategy

An analysis of foreign direct investment, the

main driver of the recent deterioration in the

UK’s current account: January 2016

Michael Hardie

Structural and International Statistics

ONS Economic Forum

19 January 2016

8

Outline

• Overview of Foreign Direct Investment (FDI)

& the Current Account deficit

• FDI by geographical region

• FDI by economic activity

9

Foreign Direct Investment

• Foreign Direct Investment (FDI) refers to cross-

border investments, with the aim of a establishing a

lasting interest in the company receiving investment.

• Ownership of at least 10% of the voting power,

representing the influence by the investor, is the

basic criterion used

• This incorporates the most recent FDI data for 2013

and 2014 – released in December 2015.

10

Foreign Direct Investment

Outward FDI Inward FDI

11

FDI and the Current Account

Secondary Income

Primary Income

Trade Current Account

FDI

Earnings

Comp. of Employees

Portfolio Investment Other

• The UK current account measures the economy’s

international transactions with the rest of the world, and

includes trade, primary income and secondary income

• The current account balance (plus capital) indicates

whether a country is a net lender or borrower 12

Overview of Foreign Direct Investment

(FDI) & the current account deficit

An analysis of Foreign Direct Investment, the key

driver of the recent deterioration in the UK’s Current

Account: January 2016

13

Net FDI earnings and impact on the current

account deficit (% of GDP), 2011 to 2014

53.5

34.9

18.8

2.0

53.5

34.9

27.8

13.2

-6%

-4%

-2%

0%

2%

4%

6%

-60

-40

-20

0

20

40

60

2011 2012 2013 2014

Percent of GDP £ billion

Net FDI Earnings - Latest published Balance of Payments estimates (LHS)

Net FDI Earnings - Balance of Payments including the latest FDI annual estimates (LHS)

CA Deficit - Latest published Balance of Payments estimates (RHS)

CA Deficit - Balance of Payments including the latest FDI annual estimates (RHS) 14

Net FDI earnings according to latest published Balance of

Payments and latest FDI annual estimates, 2011 to 2014

105

87

75 73

51 52 57

71

105

87 84

71

51 52 56 58

-80

-60

-40

-20

0

20

40

60

80

100

120

2011 2012 2013 2014 2011 2012 2013 2014

Latest published Balance of Payments estimates Balance of Payments including the latest FDI annual estimates

£ billion

Credits Debits Net Earnings 15

UK indicative current account balance deficit, 2013 to 2014

-6%

-5%

-4%

-3%

-2%

-1%

0%

1984 1989 1994 1999 2004 2009 2014

As P

erc

en

tag

e o

f G

DP

Balance of Payments including the latest FDI annual estimates Latest published Balance of Payments estimates 16

UK indicative current account balance and

components between 2006 and 2014

2.8% 2.7%

1.7% 1.6%

3.1% 3.3%

2.1% 1.6%

0.7%

-8%

-6%

-4%

-2%

0%

2%

4%

2006 2007 2008 2009 2010 2011 2012 2013 2014

As p

erc

en

tag

e o

f G

DP

Primary Income (Excl. Direct Investment) Direct Investment

Trade Secondary

Current Account Balance 17

UK FDI positions and rates of return, 2011 to 2014

8.1%

6.5%

6.1%

5.4% 5.2%

4.2% 4.5%

4.3%

0%

2%

4%

6%

8%

10%

-

200

400

600

800

1,000

1,200

1,400

1,600

2011 2012 2013 2014 2011 2012 2013 2014

Assets Liabilities

Rate of return £ billion

FDI Positions (LHS) Rate of Return (RHS) 18

FDI by economic region

An analysis of Foreign Direct Investment, the key

driver of the recent deterioration in the UK’s Current

Account: January 2016

19

UK FDI credits and debits by geographical region, 2011 to

2014

-5

0

5

10

15

20

25

30

35

40

45

EU Non-EU Europe

N America

CS America

Asia Aus & Oceania

Africa EU Non-EU Europe

N America

CS America

Asia Aus & Oceania

Africa

FDI Credits FDI Debits

£ billion

2011 2012 2013 2014

20

Movements in UK FDI assets and rates of return

between 2011 and 2014

0%

2%

4%

6%

8%

10%

12%

14%

0 100 200 300 400 500 600 700

Rate of return, %

£ billion

EU28 Europe (Non-EU) N Americas SC Americas Asia 21

Movement in UK FDI liabilities and rates of return

between 2011 and 2014

0%

1%

2%

3%

4%

5%

6%

7%

8%

0 100 200 300 400 500 600 700

Rate of return, %

£ billion

EU28 Europe (Non-EU) N Americas SC Americas Asia 22

UK FDI credits, debits and balances with the EU,

2007 to 2014

-40

-30

-20

-10

0

10

20

30

40

50

2007 2008 2009 2010 2011 2012 2013 2014

£ billion

FDI Credits FDI Debits FDI Income Balance 23

UK FDI earnings, actual and counterfactual totals,

2011 to 2014

-80

-60

-40

-20

0

20

40

60

80

100

120

2011 2012 2013 2014 2011 2012 2013 2014

Actual Counterfactual

£ billion

Credits Debits Balance 24

UK FDI credits, actual and counterfactual by

geographical region, 2011 to 2014

50

60

70

80

90

100

110

120

2011 2012 2013 2014

£ billion

EU

N America

CS America

Europe

Africa

Asia

Aus, Oce & Pol.

Composition Effect

Counterfactual

Actual

25

UK FDI debits actual and counterfactual by

geographical region, 2011 to 2014

40

45

50

55

60

65

70

75

2011 2012 2013 2014

£ billion

N America

Europe

CS America

Africa

Aus, Oce & Pol.

Composition Effect

Asia

EU

Counterfactual

Actual

26

FDI by economic activity

An analysis of Foreign Direct Investment, the key

driver of the recent deterioration in the UK’s Current

Account: January 2016

27

Figure 14: Changes in FDI credits, debits and net

between 2011 and 2014

Production

Transport, Storage & Communications

Distribution, Hotels & Restaurants

Business Services & Finance

Other

Construction

Government, Health & Support and Other Services

-25 -20 -15 -10 -5 0 5

£ billion

Due to FDI credits Due to FDI debits FDI Income Balance 28

Figure 14: Changes in FDI credits, debits and net

between 2011 and 2014

Manufacturing

Mining & Quarrying

Water collection

Electricity, gas, steam & air

-15 -12 -9 -6 -3 0 3

£ billion

Due to FDI credits Due to FDI debits FDI Income Balance 29

Summary

• Revised Foreign Direct Investment (FDI) estimates for 2013 and

2014 show that the amount the UK generated from its overseas

foreign direct investment (credits) fell from £104.6 billion to

£71.1 billion between 2011 and 2014.

• In contrast, the amount overseas investors generated on UK

direct investment (debits) increased from £51.1 billion to £57.9

billion between 2011 and 2014.

• A decrease in the value of credits and rise in debits resulted in

the UK’s net foreign direct investment earnings falling from

£53.5 billion to £13.2 billion over the period.

• Incorporating these data show that the current account balance

in 2014 widened to 4.5% of nominal GDP. This would soften the

latest published estimates of the current account, which

currently report a deficit of 5.1% of nominal GDP.

30

New ONS website

Matt Jukes, Digital Publishing

ONS Economic Forum

19 January 2016

31

What’s new

Peter Patterson, Deputy Chief Economic Adviser

ONS Economic Forum

19 January 2016

32

Manufacturing and services output

33

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

2014 JAN

2014 APR

2014 JUL

2014 OCT

2015 JAN

2015 APR

2015 JUL

2015 OCT

Manufacturing

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

2014 JAN

2014 APR

2014 JUL

2014 OCT

2015 JAN

2015 APR

2015 JUL

2015 OCT

Services

Distn, hotels & restaurants

Government & other

Business sers & finance

Transport, storage & comms

Total services

% changes on same month of previous year

Household consumption – slower growth

in cash spend while volumes grow

34

-6

-4

-2

0

2

4

6

8

2005 Q1 2006 Q1 2007 Q1 2008 Q1 2009 Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Price deflator

Volume

Current prices

% changes on same quarter of previous year

Household consumption

35

% changes on same period of previous year

-2

-1

0

1

2

3

4

5

6

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Goods

Price deflator

Volume

Current prices

-2

-1

0

1

2

3

4

5

6

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Services

Household consumption

36

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Transport

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Food and drink

Volume Price deflator Current prices

-4

-2

0

2

4

6

8

10

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Recreation and culture

-2

0

2

4

6

8

10

12

2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Restaurants and hotels

% changes on same period of previous year

Households’ financial liabilities

37

0

20

40

60

80

100

120

140

160

1987 Q1

1989 Q1

1991 Q1

1993 Q1

1995 Q1

1997 Q1

1999 Q1

2001 Q1

2003 Q1

2005 Q1

2007 Q1

2009 Q1

2011 Q1

2013 Q1

2015 Q1

Total financial liabilities Total loans Loans secured on dwellings

Stock of financial liabilities as % of households’ total annual available resources

Export and import volumes

38

80

85

90

95

100

105

110

115

120

2007 Q1 2008 Q1 2009 Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Exports

Imports

Trade volumes excluding oil and erratics, index nos, 2012=100

EU and non-EU trade volumes

39

50

60

70

80

90

100

110

120

130

1998 Q1 2000 Q1 2002 Q1 2004 Q1 2006 Q1 2008 Q1 2010 Q1 2012 Q1 2014 Q1

Total

EU

Non-EU

Volume of trade in goods excluding oil and erratics:

ratio of exports to imports, index nos 2001=100

Consumer price inflation

40

-1

0

1

2

3

4

5

6

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

% changes on a year earlier

CPI All items Core CPI

Core CPI = excluding energy, food, alcohol & tobacco

Average weekly hours worked

41

15.0

15.5

16.0

16.5

17.0

17.5

36.0

36.5

37.0

37.5

38.0

38.5

Full time Part time

Full time Part-time

Falling hours affect productivity growth

42

-2.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1

Output per worker

Output per hour

% changes on same quarter of previous year

…and average weekly earnings

43

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15

Average earnings growth

Private sector

Public sector excl financial services

Real wage growth

Three month averages, % changes on same period a year earlier

The earnings distribution - ASHE

0

1

2

3

4

5

6

7

8

9

£2.50 £5.00 £7.50 £10.00 £12.50 £15.00 £17.50 £20.00 £22.50 £25.00 £27.50 £30.00

Density, %

Gross hourly earnings, £

1997 2015

Source: Annual Survey of Hours and Earnings, ONS calculations

Distribution of hourly nominal earnings, 1997 and 2015

44

Proportion of hours paying close to NMW

3.9

3.4 3.1

0

1

2

3

4

5

6

1999 2001 2003 2005 2007 2009 2011 2013 2015

%

Within 2%

Within 1%

Within 0.5%

Proportion of hours worked paying close to the adult NMW

Adults are defined in accordance with the NMW adult rate, i.e. Between 1999 and 2008, adults

are 22 and over. From 2009 onwards, adults are 21 and over. No account made for

apprenticeships.

Source: Annual Survey of Hours and Earnings, ONS calculations 45

Real earnings growth more prevalent in 2015…

Source: Annual Survey of Hours and Earnings, ONS calculations

Notes: Real earnings calculated using the Consumer Prices Index (CPI)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Above 10%

5% to 10%

2.5% to 5%

0.5% to 2%

-0.5% to 0.5%

-2.5% to -0.5%

-5% to -2%

-10% to -5%

Below -10%

% of employees employed full-time in both years

Percentages of FT employees by their annual rate of real weekly earnings growth

46

• Capital stocks (1 Dec)

• Family Spending (8 Dec)

• Regional GVA (9 Dec)

• Public sector productivity (10 Dec)

• Wealth and Assets (18 Dec)

• Historic estimates of financial accounts and

balance sheets (12 Jan)

• GDP revisions performance (19 Jan)

What’s new –recent ONS publications

47

Shares of UK economic output by

region/country

Share of UK Economic Output (GVA)

1997 2014

North East 3.2% 3.0%

North West 10.0% 9.4%

Yorkshire and The Humber 7.2% 6.7%

East Midlands 6.4% 6.0%

West Midlands 8.1% 7.2%

East of England 9.0% 8.7%

London 19.2% 22.9%

South East 14.9% 15.1%

South West 7.7% 7.6%

Wales 3.7% 3.4%

Scotland 8.3% 7.8%

Northern Ireland 2.4% 2.2%

In 2014:

The Greater South

East (London + SE +

EE) produced 47% of

UK output.

North of England 19%,

Midlands 13%,

Devolved nations 13%.

48

London has outperformed since 2008

The 2008-2014 data

shows how the

regions fared through

the downturn and

subsequent recovery.

The 2002-2008 data

shows how the

regions fared in a

similar period prior to

the downturn.

Note: due to the

economic downturn,

annual output in most

regions reached a

temporary peak in

2008 before declining

in 2009.

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Northern Ireland

Yorkshire and The Humber

North East

North West

Scotland

East of England

West Midlands

Wales

South West

East Midlands

South East

London

Increase in nominal GVA

Regional GVA growth before and since 2008

2008-2014 2002-2008 49

Chained volume measure GDP at market prices

1991 to 2015, by Blue Book vintage, £ billion

50

220

240

260

280

300

320

340

360

380

400

420

Q1 1991

Q1 1993

Q1 1995

Q1 1997

Q1 1999

Q1 2001

Q1 2003

Q1 2005

Q1 2007

Q1 2009

Q1 2011

Q1 2013

Q1 2015

BB2003

BB2004

BB2005

BB2006

BB2007

BB2008

BB2009

BB2010

BB2011

BB2012

BB2013

BB2014

BB2015

£ billion

Revisions to GDP growth between first and third

estimates, Q1 2007 to Q3 2015

M1 M3 Revision

Absolute

Revision

Q1 2007 0.7% 0.7% 0.0% 0.0%

Revision Count

Q3 2013 0.8% 0.8% 0.0% 0.0% -0.5% 1

Q4 2013 0.7% 0.7% 0.0% 0.0% -0.4% 0

Q1 2014 0.8% 0.8% 0.0% 0.0% -0.3% 0

Q2 2014 0.8% 0.9% 0.1% 0.1% -0.2% 1

Q3 2014 0.7% 0.7% 0.0% 0.0% -0.1% 10

Q4 2014 0.5% 0.6% 0.1% 0.1% 0.0% 12

Q1 2015 0.3% 0.4% 0.1% 0.1% +0.1% 7

Q2 2015 0.7% 0.7% 0.0% 0.0% +0.2% 2

Q3 2015 0.5% 0.4% -0.1% 0.1% +0.3% 2

Average revision 0.00% 0.11%51

Mean revisions, quarter on quarter growth, chained

volume measure GDP, T to T + 24 months

52

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

Q2 1961 to Q4 1971

Q1 1972 to Q4 1983

Q1 1984 to Q4 1994

Q1 1995 to Q4 2004

Q1 2005 to Q3 2013

Mean absolute revisions % growth

-0.04%

-0.02%

0.00%

0.02%

0.04%

0.06%

0.08%

0.10%

0.12%

0.14%

0.16%

Q2 1961 to Q4 1971

Q1 1972 to Q4 1983

Q1 1984 to Q4 1994

Q1 1995 to Q4 2004

Q1 2005 to Q3 2013

Mean revisions % growth

GDP at market prices, CVM percentage growth, Q1

1960 to Q4 2012, quarter on quarter

53

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Q1 1960

Q1 1964

Q1 1968

Q1 1972

Q1 1976

Q1 1980

Q1 1984

Q1 1988

Q1 1992

Q1 1996

Q1 2000

Q1 2004

Q1 2008

Q1 2012

T

T +3

T +6

T +12

T +24

T + 36

T + 48

T + 60

GDP at market prices (CVM) growth, Q1 1960 to Q4

2012, quarter on quarter (T and T +60 months)

54

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Q1 1960

Q1 1964

Q1 1968

Q1 1972

Q1 1976

Q1 1980

Q1 1984

Q1 1988

Q1 1992

Q1 1996

Q1 2000

Q1 2004

Q1 2008

Q1 2012

T

T + 60

Productivity by firm size

55

30

35

40

45

50

55

60

2008 2009 2010 2011 2012 2013 2014

£ thousands

1 to 9 employees

10 to 49 employees

50 to 249 employees

250+ employees

Output per worker

Source: ONS Economic Review, January 2016

What’s next

Darren Morgan, Deputy Director, National Accounts

Coordination

ONS Economic Forum

19 January 2016

56

• Blue Book 2016 plans

• National Accounts work plan

• Use of HMRC VAT administrative data

• Construction output and prices development

• Household satellite account plans

What’s next - outline

57

Scope of Blue Book 2016 (slide 1 of 6)

Key BB16 methodological improvement

• Data sources and methodology used in measuring the

estimates for imputed rental

4

Scope of Blue Book 2016 (slide 2 of 6)

BB16 technical improvements

• The sub-division of non-market output into:

payments for non-market output (fees and charges)

non-market output, other (provided free at point of consumption)

reclassification of income received by Govt and Non-Profit

Institutions Serving Households from market output to payments for

non-market output

59

Scope of Blue Book 2016 (slide 3 of 6)

BB16 technical improvements cont’d

• Classification and recording of social transfers in kind

market production for the first time:

Government purchases of goods and services delivered directly to

households by the market producer

Best example is prescription medicines

60

Scope of Blue Book 2016 (slide 4 of 6)

Other BB16 improvements

• Calculation of explicit adjustments for VAT fraud without complicity

• Minor change to the methodology used in estimating illegal activities

• Incorporation of a methodology improvement made by HM Revenue &

Customs for the import of gas

• Improvements to water transport and post & courier industry (output)

• Base year and reference year changes

61

Scope of Blue Book 2016 (slide 5 of 6)

Other BB16 improvements cont’d

• Reclassifications: keeping NA in line with latest reclassifications:

Transport for London classification changes (to local govt. from public

non-financial corps) taken into Capital Stocks/Capital consumption

London Continental Railway re-classified to the Public Corporations

sub-sector from Central Government

• Inclusion of the London Crossrail Business rates supplement

62

Scope of Blue Book 2016 (slide 6 of 6)

And finally…

• Transition from output at purchaser’s prices to basic prices.

• No data impact but will lift final ESA95 GNI reservation

63

Scope of Blue Book 2016 Communications (1 of 3)

Communications - similar approach to last couple of years

Wave 1: methodological details and impact (annual) on current prices for

earlier years (1997 - 2011): 24 February

• Impact on GDP CP annual estimates

• Methodological article: Imputed Rent

• Methodological article: Market/non-market split and social transfers in kind

• Details of all other improvements (separate article or part of impact one)

64

Scope of Blue Book 2016 Communications (3 of 3)

Wave 2: impact (annual) on chained volume measures for earlier years

(1997 – 2011): 23 March

Wave 3: current prices & chained volume measures: annual and

quarterly: later years: SFA, BoP as well as GDP

• Impact on GDP CP & CVM annual and qtly estimates: 1997 – 2014

• Impact on SFA: 1997 – 2014

• Impact on BoP: 1997 – 2014

• Classification changes to National Accounts for BB16

• GDP: 20 May

• SFA, BoP, Classifications: 7 June

http://www.ons.gov.uk/ons/guide-method/method-quality/specific/economy/national-

accounts/changes-to-national-accounts/index.html

65

NA work plan update

• consulted 13 July - 25 Sep, published response and updated plan 27 Nov.

2016-2018 plan:

• High quality regular outputs: better understood, underlying data more accessible

• Meet international standards:

• 2017: NPISH/Household Split, Sub-Sectoring of Financial Corp sector, Introduction of

Revaluation of Change in Volume Acct, Pension Supplementary Table/core accounts

consistent

• 2018: Supply-Use in Previous Years Prices

• Flow of Funds, GDP(O) improvements, NA/Public Sector Finances Alignment continue

• Improved data sources:

• new Purchases Survey: start to use in 2017, use fully in 2018

• increased use of admin data

• Will review and produce new plan following Bean Review’s final report

66

HMRC data in National Accounts

• Parallel-runs of HMRC and MBS will be used to test impact of approach in the

Spring for a pilot number of industries.

• Pilot use of turnover data for part of short-term output indicators and GDP(O) in

Summer 2016

• Likely to retain Monthly Business Survey (MBS) ‘fully enumerated’ businesses

(14,000 per month)

• BUT…replace some or all of the sampled MBS businesses (18,000 per month)

with admin data.

• December 2015 article illustrated the potential impact of our long-term aim for

three industries. Revisions to Q on Q growth were not significant.

67

Q-o-Q Growth rates 2011Q2 to 2014Q4: MBS/VAT (red) vs. MBS (blue)

2011Q

2

2011Q

3

2011Q

4

2012Q

1

2012Q

2

2012Q

3

2012Q

4

2013Q

1

2013Q

2

2013Q

3

2013Q

4

2014Q

1

2014Q

2

2014Q

3

2014Q

4 -0.5

-0.4

-0.3

-0.2

-0.1

0.0

0.1

0.2

0.3

0.4

0.5

SIC07 55 – Accommodation services

2011Q

2

2011Q

3

2011Q

4

2012Q

1

2012Q

2

2012Q

3

2012Q

4

2013Q

1

2013Q

2

2013Q

3

2013Q

4

2014Q

1

2014Q

2

2014Q

3

2014Q

4 -0.5

-0.4

-0.3

-0.2

-0.1

0.0

0.1

0.2

0.3

0.4

0.5

SIC07 58 – Publishing activities

2011Q

2

2011Q

3

2011Q

4

2012Q

1

2012Q

2

2012Q

3

2012Q

4

2013Q

1

2013Q

2

2013Q

3

2013Q

4

2014Q

1

2014Q

2

2014Q

3

2014Q

4 -0.5

-0.4

-0.3

-0.2

-0.1

0.0

0.1

0.2

0.3

0.4

0.5 SIC07 75 – Veterinary activities

Points to note:

• All HMRC VAT data is ‘experimental’

and not finalised.

• Work to address issues incomplete:

e.g. cleaning, calendarisation

• Results are for illustrative purposes.

68

Construction: Current position

• construction output and new orders deflated using interim

solution

• due to assumptions not possible to use for prolonged period

• created steering group to guide development

70

Construction: Going forward

• 11 December 2015 published work plan.

• consultation launched shortly to confirm priorities identified by

the steering group.

• comparison of construction output and VAT will be published.

• part of work on nominal data, also reviewing collection

instrument.

• high level view given of options available for construction price

and cost indices

71

Development options: construction price and cost indices

Three options have been identified:

• create Tender Price Index and convert to Output Price Index

• OECD method: use input prices and convert to output prices

• establish survey for construction prices or use external data

• feasibility studies for options begun.

72

Household Satellite Accounts (HSA)

• ONS currently compiling a set of household satellite accounts for 2014.

• Provides a means by which the influence of changing patterns of unpaid work on the economy can be measured.

• HHSA will value unpaid household work, including: Childcare

Adult care

Housing services (e.g. DIY, gardening)

Nutrition

Transport

Volunteering

Laundry

• Aim to publish in late March/Early April.

73

ONS Economic Forum - Measuring owner

occupiers' housing costs in CPIH

Friday 26 February 2016, 09:00-11:30

Conference Centre, Bank of England, Threadneedle

Street, London, EC2R 8AH

Chair - Jonathan Athow (Deputy National Statistician for Economic

Statistics)

09.00 Registration and coffee

09.30 Welcome: Jonathan Athow

09.40 ONS - Development of the owner occupiers' component of CPIH and

research on the private rental sector

10.10 Countrywide - Expert in the private rental sector: Johnny Morris

(Research Director)

10.30 Refreshment break

10.50 Open panel discussion (ONS, Countrywide, Bank of England)

11.30 Close

74