December 2009
Issued by
Office for National Statistics,
Government Buildings, Cardiff
Road, Newport NP10 8XG
Media Office 0845 6041858
Business Area 0163 3456492
[email protected]
Summary Quality Report for Index of Production
1 Introduction
This report is part of a rolling programme of quality reports being introduced by the Office for
National Statistics (ONS). The full programme of work being carried out on Statistical Quality1 is
available on the National Statistics website.
The Index of Production (IoP) measures the production of the manufacturing, mining and quarrying,
and energy supply industries, which covers 17.2 per cent of the UK economy in 2005.
2. Summary of Quality
2.1 Relevance
The degree to which the statistical product meets user needs for both coverage and content.
IoP is intended to provide a general measure of monthly changes in the volume of output of
production industries. The IoP shares exactly the same industry coverage as the corresponding
quarterly series within Gross Domestic Product (GDP)2. The UK IoP has existed in more or less its
present form since the late 1940s, publishing three broad production categories of manufacturing,
mining and quarrying and energy. The IoP has three primary uses:
• as a short-term economic indicator in its own right. The Government and the Bank of
England, among others, monitor the IoP as an important indicator of industrial activity
•
as a component of the production or output measure of GDP2, the IoP contributes to the UK
National Accounts3
•
as a requirement for the Statistical Offices of the European Community (Eurostat) information on production and current price sales are provided to Eurostat
On a monthly basis, the individual indices of production are obtained from two main types of source
data:
1. output measured in physical units such as tonnes of coal or cubic metres of gas, which are
provided by other government departments
2. output measured in turnover sales. The source data for turnover sales is the Monthly
Production Inquiry (MPI)4 of the manufacturing industry
2.2 Accuracy
The closeness between an estimated result and the (unknown) true value.
The monthly measure of IoP is equivalent to the production sector of quarterly GDP2, which uses
the same data. The only difference is the periodicity of output. Therefore, the average of the three
months of a quarter in a published IoP series equals the corresponding quarterly value in GDP2.
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One dimension of measuring accuracy is reliability, which can be measured using evidence from
analyses of revisions to assess the closeness of early estimates to subsequently estimated values.
The results of revisions analysis are regularly presented in the background notes of IoP Statistical
Bulletins available on the IoP Homepage5. Spreadsheets giving revisions triangles of estimates for
all months from December 1997 through to the current month are also available from this page.
Being part of the UK National Accounts3, the monthly IoP is constrained by the National Accounts
revisions policy6. Revisions to data occur for a number of reasons:
•
late returned questionnaires
• incorrect estimates or revised back data and
• revisions to seasonal adjustment factors (which are re-estimated every period and subject
to annual review in the spring)
Each month the revisions policy determines the period that may be amended from
previously published values, usually only a short period but occasionally a longer span of
data.
Another standard measure of the accuracy (or precision) of time series is the standard error of the
growth of the index. Further information and data on standard errors within the IoP are available on
the ONS website on the IoP Homepage5.
Turnover data, deflators and inventory data are processed at class level as they have data quality
adjustments applied at this level of processing. There are quality assurance procedures in place to
understand and explain movements in the data, to allow informed quality adjustments and to check
that the computer system is calculating the published indices correctly. Tables of data and revisions
to data, showing index numbers and growth rates, help to identify unusual behaviour. Briefing
information is supplied each month by the MPI team.
2.3 Timeliness and Punctuality
Timeliness refers to the lapse of time between publication and the period to which the data refer.
Punctuality refers to the time lag between the actual and planned dates of publication.
The National Statistics Release Calendar7 is available online and provides twelve months advanced
notice of releases. Publication dates are fixed and have never been delayed or missed. In the
unlikely event of a change to the pre-announced release schedule, public attention should be drawn
to the change and the reasons for the change should be explained fully at the same time, as set out
in the Code of Practice for Official Statistics8.
The IoP is usually published approximately 26 working days after the end of the reference month. It
is the earliest official indicator of the performance of UK industry. The IoP is published on the ONS
website as a Statistical Bulletin on the IoP Homepage5.
As the IoP is a short-term indicator, the main users want the figures to be available as soon as
possible after the end of the period to which they refer. As a result revisions are an inevitable
consequence of the trade off between timeliness and accuracy.
2.4 Accessibility and Clarity
Accessibility is the ease with which users are able to access the data, also reflecting the format(s)
in which the data are available and the availability of supporting information. Clarity refers to the
quality and sufficiency of the metadata, illustrations and accompanying advice.
IoP Statistical Bulletins conform to the standards set out in the Code of Practice for Official
Statistics8.
IoP Statistical Bulletins and Time series datasets9 are available to download free of charge after
9.30am on the day of publication.
For queries on the IoP series, compilation methods, quality information or difficulties in finding the
latest figures, contact the IoP enquiry team by email: [email protected] or by
telephone, 01633 456492.
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2.5 Comparability
The degree to which data can be compared over time and domain.
Every effort is made to ensure that the series is comparable over time, and a comparable time
series is available back to 1948 for annual figures (1968 for quarterly and 1968 for monthly).
Where possible, changes to methodology are applied to the whole series to ensure this
comparability is maintained. However, National Accounts revisions policy6 may mean that these
methodology changes may take time before they become published for the complete series.
Since international standards such as the System of National Accounts 1993 (SNA 93)10 and the
European System of Accounts 1995 (ESA 95)11 are used in the production of the IoP, the figures
should be directly comparable with the accounts of other countries. However, the revisions policy of
these countries should be examined before comparing data for back periods.
2.6 Coherence
The degree to which data that are derived from different sources or methods, but which refer to the
same phenomenon, are similar.
The majority of source data are derived from MPI4. There is no comparable monthly source, but
after two years when annual turnover becomes available from the Annual Business Inquiry (ABI)12,
checks can be undertaken to ensure consistency between the 12 monthly returns and the data
returns from large businesses.
Data from the IoP are a direct input to the quarterly GDP2 dataset. This indicates that the datasets
are entirely consistent with no quality adjustments made to the production data within GDP2.
3. Summary of Methods Used to Compile the Output
The monthly IoP provides a timely indicator of growth in the output of production industries. The IoP
has the same conceptual basis as the output measure of GDP2, it is designed to measure the
change in the Gross Value Added (GVA)13 of the production industries.
IoP uses a wide variety of different data, from several sources. Each industry in the IoP is
expressed as an index series and therefore to be able to compile higher level aggregates the
industries are weighted together. This is done according to their relative contribution to total GDP2
based on their GVA13 at a set point in time. In general the larger the GVA13 for a particular industry
the larger will be its relative contribution to total GDP2 and so the higher will be the ‘weight’
associated with that industry.
The index is constructed within ONS’ Central Shared Database (CSDB), a computer system that is
widely used in compiling the UK National Accounts3. This computer system incorporates the
functions that operate upon the source data in order to produce the output indices. At each stage of
processing a number of mathematical calculations and statistical functions are applied to the data
to produce the published aggregate figures.
The IoP Production team uses a variety of procedures to try to ensure that the estimate is of high
quality. The purpose of these is to understand and explain movements in the data, to allow
informed quality adjustments and to check that the computer system is calculating the published
indices correctly.
Statistical disclosure control methodology is applied to the data. This ensures that information
attributable to an individual or individual organisation is not identifiable in any published outputs.
The Code of Practice for Official Statistics8, and specifically the Principle on Confidentiality set out
practices for how we protect data from being disclosed. The Principle includes the statement that
ONS outputs should “ensure that official statistics do not reveal the identity of an individual or
organisation, or any private information relating to them, taking into account other relevant sources
of information”. More information can be found in National Statistician’s Guidance: Confidentiality of
Official Statistics14 and also on the ONS Statistical Disclosure Control Methodology15 page of the
ONS website.
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4 References
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Title of Reference
Statistical Quality
Gross Domestic Product
(GDP)
UK National Accounts
Monthly Production Inquiry
(MPI)
IoP Homepage
National Accounts Revisions
Policy
National Statistics Release
Calendar
Code of Practice for Official
Statistics
IoP Time Series webpage
System of National Accounts
1995 (SNA 93)
European System of
Accounts 1995 (ESA 95)
Annual Business Inquiry
Gross Value Added
National Statistician’s
Guidance: Confidentiality of
Official Statistics
ONS Statistical Disclosure
Control Methodology
Website Location
http://www.ons.gov.uk/about-statistics/methodology-andquality/quality/index.html
http://www.statistics.gov.uk/CCI/nugget.asp?ID=56&Pos=3&ColRank=
1&Rank=294
http://www.statistics.gov.uk/statbase/Product.asp?vlnk=1143
http://www.ons.gov.uk/about/surveys/a-z-of-surveys/monthly-inquiryinto-the-production-industries/index.html
http://www.statistics.gov.uk/statbase/Product.asp?vlnk=6230
http://www.statistics.gov.uk/CCI/article.asp?ID=1187&Pos=1&ColRank
=2&Rank=224
http://www.statistics.gov.uk/ReleaseCalendar/findreleases.asp?
http://www.statisticsauthority.gov.uk/assessment/code-ofpractice/index.html
http://www.statistics.gov.uk/statbase/tsdtables1.asp?vlnk=diop
http://unstats.un.org/unsd/sna1993/introduction.asp
http://circa.europa.eu/irc/dsis/nfaccount/info/data/ESA95/en/een00000
.htm
http://www.statistics.gov.uk/abi/
http://www.statistics.gov.uk/CCI/nugget.asp?ID=254&Pos=6&ColRank
=1&Rank=224
http://www.statisticsauthority.gov.uk/nationalstatistician/guidance/confidentiality-of-official-statistics.pdf
http://www.statistics.gov.uk/about/data/methodology/general_methodo
logy/sdc.asp
i
Last Updated: December 2009
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