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The UK’s statistics agency on Friday paused the publication of two price indices used to help calculate GDP figures, the latest admission of flawed data at the beleaguered authority.
The Office for National Statistics said it had found flaws in its producer price indices and services producer price indices, which provide an indication of price pressures within business supply chains.
“During work to improve the systems used to create the producer price index (PPI) and the services producer price indices (SPPI), our quality assurance identified a problem with the chain-linking methods used to calculate these indices,” the agency said.
“As a consequence, we are pausing the publication of PPI and SPPI data, which was next due on 26 March, while we rectify this issue,” it added.
The decision will fuel questions over the reliability of figures produced by the ONS, after the agency postponed the publication of trade data and continues to grapple with long-running problems in a key survey on the state of the labour market.
Rob Wood, chief UK economist at consultancy Pantheon Macroeconomics, said errors in ONS data were “now becoming widespread . . . which must raise the questions of how reliable all the statistics are”.
With flawed figures on the labour market, trade and PPI, “there must be questions about what other errors and problems are lurking that we haven’t found out yet”, he added.
The detailed price data is used within GDP calculations. The ONS said the issues may lead to revisions to estimates for services, production and construction particularly likely in 2022 and 2023, though problems with the data stretch as far back as 2008.
“At an aggregate level for GDP, these revisions should be offsetting to an extent, while taken alongside regular data deliveries,” the agency said.
“Early indications suggest that there will not be a notable change in the recent economic trends seen in these data, but we will update users once more information becomes available,” it added.
This problem also affects some of the deflators used for both trade in goods and trade in services, including the import price indices and export price indices.
“Early analysis suggests that some goods export and import data from 2023 may be impacted, and some goods export data prior to 2014,” the ONS said.
Jonathan Portes, professor of economics and public policy at King’s College London, said the PPI and SPPI errors were “obviously unfortunate” but not “unusual”, since the ONS had introduced a number of methodological changes around the use of deflators over time.
The agency said it did not expect any changes to the publication timetable for monthly, quarterly or annual GDP. It also said the headline consumer prices index and a broader inflation measure that includes housing costs, CPIH, were “completely unaffected”.
Earlier on Friday, the Institute for Fiscal Studies think-tank said a major revision by the ONS to official estimates of private pension household wealth was “fundamentally flawed”, leaving policymakers with no reliable guide as to how wealth is distributed among households.
