The RPI scandal has been a slow motion car crash since 2010. The nation’s most well-used and well-known statistic has been subjected to silly mistakes in production, weak and indecisive management, too much political influence and misuse, an overbearing economist mindset, more dogma than imagination, limited innovation, and mixed messages from those supposedly in control. This sad story with resulting confusion for users reflects a fundamental failure of governance. This blog provides a one-stop shop for anyone looking to understand the governance, or lack of it. The next chapter in this saga will come later this week with the publication of the House of Lords report into the RPI. Continue reading RPI – the background to the scandal
I can see why many individual British businesses with established exports to the EU want the country to stay in the single market. The UK’s departure from it will be a change and, while the future might or might not offer more trading opportunities, change diverts corporate attention and can be disruptive. That said, from a national perspective – UK plc – the statistics show that the single market has increasingly been operating against the economic interests of the UK as a whole. In that macro sense, looking at the data, the single market is bad news as it’s driving the country’s ever-widening trade balance in goods. Continue reading The UK’s “single market trade deficit”
We all have a small number of people who heavily influence us. One of the big influences on my statistical thinking was Ray Thomas. I met him when we volunteered on several RSS committees. Sadly he died earlier this year. Links to some obituaries are below but his PhD thesis from 1999 is worth a read. The language and terms might be dated but “Statistics as facts about society” deals with many of the issues that plague us today. Continue reading Ray Thomas
The monthly release of the inflation figures (due tomorrow Wednesday 16th) is always a reminder of the futile attempts by ONS/UKSA to suppress the RPI. The RPI is the most popular statistic produced by the ONS (as measured by web hits, calls to ONS etc.) yet there’s no commentary on the RPI and the numbers do not appear in the 11 page press release. The breakdown of the RPI is hidden away in the back three pages of the 19 page data pack (just after the table that gives the rates for Lithuania, Slovakia and other EU states that the ONS presumably thinks are more interesting to users). To note the madness of this continuing practice, please find below a fairytale. Continue reading The king and his fish: the RPI fairytale
I spoke at an event about the Retail Prices Index (RPI) last week and made three points – that there is a misunderstanding about the formula effect, ONS is too influenced by economists’ ‘group think’ and weaknesses in governance. These can all be resolved easily, returning RPI to full use, if ONS and UKSA wants to. It was widely agreed that “the mess” had to be sorted out, and as the RPI cannot be killed off some modest changes to it are required. Continue reading The truth about the RPI – some brief comments
This is about a bad trend in some questionable data: the official data says that the UK has a huge balance of trade deficit in goods, it’s getting worse and the driving force behind the trend has been the growing deficit with the EU. True? Probably. This trade deterioration needs to be noted, diagnosed, discussed as part of the Brexit negotiations and reversed. Continue reading The UK’s trade deficit in goods
Can the Retail Prices Index be killed off? Should it be killed off and, if so, for what reason? Or is reform needed? A meeting is coming up (at the RSS in London, on 13 June, book here) to discuss the future of the RPI and the changes needed to all consumer price measures to keep them fit for purpose. Why not come and hear the views of John Pullinger, the UK’s National Statistician, and other experts?
Without wanting to engage in BBC bashing it must be said that this morning’s BBC Radio 4 Today programme had too many examples of sloppy use of data. There were school boy errors: focusing on the latest figure not the trend, comparing annual data to quarterly data, getting the number wrong, ignoring the impact of inflation when comparing figures over time, choosing the wrong denominator and flooding the debate with large but ultimately meaningless numbers. I am not a regular listener to the BBC’s flagship news programs but I hope they are generally better than this! Continue reading BBC and sloppy numbers
The RPI has recently been subjected to a sustained bout of unfair criticism from politicians and commentators. Despite this, the judge in the recent BT pensions case deemed that the RPI had not “become inappropriate” and that BT had no grounds for moving a group of their pensioners to the CPI which gives generally lower upratings. The RPI is, therefore, still fit for purpose. This was a relief to me – I was the expert witness arguing in favour of the RPI – if not a surprise. The full story as to how we got to the situation where so many people (mostly, it must be said, economists and the powerful and self-interested trying to cut their costs) are doing the RPI down is yet to be told. The decision was important for the pensioners as their incomes would not be unjustifiably cut. It was also a good day for common sense, and for the RPI, one of the country’s longest-standing, most trusted and widely-used statistics. The Thales and BT rulings taken together provide food for thought for those who continue to damage the reputation of the RPI without looking beyond the mantras and sloppy headlines. Continue reading RPI: Still fit for purpose
The earnings figures are very important and politically sensitive, yet the trends are highly uncertain and poorly presented by ONS. The poor presentation by the ONS centres on the failure to remove compositional changes and present earnings growth on a like-for-like basis. This has not only led to an overly pessimistic view of what’s happening in the real world but means that political and media attention has been diverted from the real issues in the labour market.