office for national statistics: annual report 1998-1999

A N N U A L R E P O R T

& A C C O U N T S

1 9 9 8 – 9 9

WO R K I N G

TO I M P R OV E

EVERYONE’S L IVES

WO R K I N G

TO I M P R OV E

EVERYONE’S L IVES

A N N UA L R E P O R T & AC C O U N T S 19 9 8 – 9 9

OUR AIM IS FOR ONS TO BE A PROVIDER OF WORLD CLASS STATISTICAL

AND REGISTRATION SERVICES.

WITH THE AGREEMENT OF THE CHANCELLOR OF THE EXCHEQUER, ONS

SET ITSELF THE FOLLOWING OBJECTIVES FOR 1998–99:

› To provide a trusted and authoritative statistical service, in accordance

with UK, EU and international requirements, to improve decision making,

stimulate research and inform debate within government and the wider

community; and

› To ensure the registration of key life events in order to protect and

help individuals.

Presented to Parliament in pursuance of Section 5 of the Exchequer and Audit

Departments Act 1921

Ordered by the House of Commons to be printed 27 July 1999

THE STATIONERY OFFICE £12.55

OBJECTIVES

731

AIM

The Office for National Statistics (ONS) is working to improve everyone’s lives, from

the very young to the very old. Daniel Harris (front) and Evelyn Whitworth (page

26 and back), like all the people featured in this publication, are real people dealing

with real issues. Directly or indirectly, their lives are affected by the work we do.

FRONT COVER

Daniel Harris is five and has leukaemia. He is a patient on Piam Brown Ward at Southampton

General Hospital. Doctors and hospitals supply details of all cancer registrations to regional

cancer registries which then pass these to ONS to be processed for the Department of

Health.These statistics help to monitor the incidence of cancer and cancer survival trends.

ONS also maintains the NHS Central Register – a key database of all patients registered

with a GP in England and Wales.

ACKNOWLEDGEMENTS

ONS and Celsius would like to thank the following for their help and participation in the

photography used in this report:

Daniel Harris, Dr Jan Kohler, Consultant at Southampton General Hospital, and Daniel’s

mother, Debbie Harris; Deborah Short, Melanie Cook, Mr Brogan and the pupils of Shirley

Junior School; Alex, Simon and George; Richard, Roswitcha,Tristan and Tamsin Gadd and

Barbara Davis; Amanda, Stuart, Isaac and David Thom and Annette Becker; Darra Singh,

Mary Scanlan and Chris Birchall of Hexagon Housing Association and Jon Broome of

Architype architects; Lorraine Streater, Damian Braganza, Bose Akomolafe, Beverley Botting

and Lois Cook of ONS; Ernest Peck; Gill and Evelyn Whitworth and Oliver Rau.

© Crown copyright 1999

ISBN 0-10-276499-9

OFFICE FOR NATIONAL STATISTICS

1 Drummond Gate

London SW1V 2QQ

National Statistics Public Enquiry Service

01633 812973 (From 31 August 1999: 020 7533 5888)

[email protected]

www.ons.gov.uk

celsius|

Alan Hunter

Signal Press, London

In line with ONS’s Green Policy, this report is printed on environmentally friendly paper.

T:

E– MAIL:

WEB:

DESIGN:

PHOTOGRAPHY:

PRINTER:

PAPER:

DIRECTOR’S REVIEW

ABOUT THE OFFICE FOR NATIONAL STATISTICS

ABOUT THIS REPORT

STATISTICAL ACTIVITIES

REGISTRATION ACTIVITIES

OFFICE–WIDE ACTIVITIES

THE FUTURE

ANNEX A – PERFORMANCE AGAINST TARGETS 1998 –99

ANNEX B – RECRUITMENT 1998 –99

ANNEX C – AVERAGE EARNINGS INDEX

ANNEX D – ONS PUBLISHING APRIL 1998 – MARCH 1999

ACCOUNTS 1998 –99

C O N T E N T S

5

7

9

11

16

19

22

24

27

27

28

31

Alex, Simon and George are

all 15 years old; they live

in London and meet up most

afternoons after school

to go skateboarding and

rollerblading. ONS provides

a variety of information on

teenagers and young adults, often through government surveys that cover issues such as the

economic activity and level of earnings of young adults; the development and well-being of

adolescents; their dietary habits and nutritional status; smoking and drinking habits; and

their participation in sport and other physical activities.

Alex, Simon and George are

all 15 years old; they live

in London and meet up most

afternoons after school

to go skateboarding and

rollerblading. ONS provides

a variety of information on

teenagers and young adults, often through government surveys that cover issues such as the

economic activity and level of earnings of young adults; the development and well-being of

adolescents; their dietary habits and nutritional status; smoking and drinking habits; and

their participation in sport and other physical activities.

This report covers the third year of the Office’s existence.

As usual, we began the year with a challenging programme of on-going work and

developments designed to meet high priority demands from our users.We have made

good progress and performed well against our corporate targets.

We have achieved much during the year and this report reflects this. Many of our

statistical outputs form part of regular statistical series and are produced month on

month, year on year. Improving the quality of service is a constant challenge for staff

throughout the office. Even maintaining existing quality is a major task, as systems have to

be adapted to monitor a rapidly changing society.This on-going work should not be

forgotten in the eagerness to celebrate the new. It forms the core of the 300 First and

Press Releases, all of them issued on their pre-announced publication date, and the 421

publications published this year.

There were also successful developments in 1998–99:

› The year began with the launch of a wide-ranging debate on the future

governance arrangements for National Statistics. Discussions have continued

throughout the year.

› The 1998 annual National Accounts were published in September. This was the

most far-reaching revision to the National Accounts since they were set up in

the 1950s. The UK was the first country in the EU to convert to ESA 95 with a

full set of back series.

› The new look Labour Market Trends provided a more user-friendly approach to

the increasingly complex labour market by improving presentation of both

national and regional labour market statistics involving better integration of

data from different sources.

› Proposals for the census, including plans for a number of new questions were

published in a White Paper in March. For the first time, this census will be

processed with the help of private sector expertise to produce and scan over 30

million census forms. In February, along with my fellow Registrars General

from Scotland and Northern Ireland, I signed the contract with a consortium

headed by Lockheed Martin.

› A fundamental review of the civil registration service in England and Wales was

launched in December. The aim is to provide the basis for a service which can

adapt to the ever-changing needs and attitudes of a modern society and which

can adopt modern methods and technology to meet them.

› We have contributed to cross government work, in particular on supporting

families, social exclusion, modernising Government and combating fraud.

Despite these significant achievements we can only consider 1998–99 as a partial success.

The decision in autumn 1998 to suspend the Average Earnings Index (AEI) brought our

methods and processes under close external scrutiny.The report and recommendations of

the Turnbull/King Review were published on 1 March. More details are given in Annex C

on page 27.

We have also come under the spotlight from other sources. As a result of the

Government’s Comprehensive Spending Review a high level review was undertaken by

external consultants to help identify scope for efficiency savings for future reinvestment in

improved outputs.The Economic Secretary accepted the recommendations made by the

review’s Steering Group in February 1999. As part of its regular programme, the Treasury

Select Committee also reported on ONS at the end of 1998.

The combined effect of the recommendations from the AEI Report and these major

reviews means we face radical change for 1999–2000 and beyond.The ONS Policy Board

is committed to delivering on the recommendations.The challenges and our plans for

D I R E C T O R ’ S R E V I E W

5 ONS A n n u a l R e p o r t & A c c o u n t s 19 9 8 – 9 9

Deborah Short is four months pregnant with

her second child. She is Head of Year at

Shirley Junior School in Southampton. When

born, Deborah’s baby will be registered

by the local Registration Service and the

details sent to the General Register Office (part of ONS). This information will then

be used by ONS to calculate birth rates and provide population estimates and projections.

ONS is also active in monitoring women’s fertility; the age of women when they have

their first child; and congenital anomalies detected at and after birth.

Deborah Short is four months pregnant with

her second child. She is Head of Year at

Shirley Junior School in Southampton. When

born, Deborah’s baby will be registered

by the local Registration Service and the

details sent to the General Register Office (part of ONS). This information will then

be used by ONS to calculate birth rates and provide population estimates and projections.

ONS is also active in monitoring women’s fertility; the age of women when they have

their first child; and congenital anomalies detected at and after birth.

dealing with them are described in more detail in our 1999–2002 Business Plan. As we

release efficiency savings, we shall plough them back to improve the quality and range of

our outputs.

We are facing a period of significant change and inevitably this means a period of

uncertainty for staff. However, the commitment to our work from staff at all levels within

ONS is a tribute to them. Even through periods of uncertainty and change, regular

outputs and developments continue to be maintained.

Our priorities for the future are unchanged: we will continue to provide world class

statistics and registration services. Our challenge is to recognise the opportunities

presented to us by the period of change we face.

Tim Holt

Director

THE THREE ROLES OF TIM HOLT

Director, ONS

Directly accountable to the Chancellor of the Exchequer for the operation and

performance of the Office in accordance with the Framework Document and its

approved plans.

Registrar General for England and Wales (RG)

Responsible for the administration of the marriage laws and to secure the

provision of an effective system for the registration of vital events, ie births,

marriages and deaths. This is a statutory office, to which he is appointed by

Letters Patent.

Head of the Government Statistical Service (GSS)

Responsible for promoting the provision across government of co-ordinated,

high-quality, cost effective and easily accessible statistics.

The Office for National Statistics was created on 1 April 1996 as an Executive Agency

and a government department, accountable to the Chancellor of the Exchequer.The

Office has about 3,000 staff operating in London, Newport (South Wales), Runcorn,

Southport and Titchfield (Hampshire), plus around 1,000 interviewers working on social

surveys countrywide.

ONS is an equal opportunity employer and is committed to a policy of non-

discrimination for both its employees and potential recruits. In January 1999 the Director

signed up to the Commission for Racial Equality’s Leadership Challenge, committing him to

give a personal lead in promoting the principle of racial equality and taking practical action.

Systems are in place to ensure that recruitment is carried out on the basis of fair and

open competition. Our report on recruitment is in Annex B on page 27.

Our international reputation has grown rapidly in the first three years of the Office.

During the last year ONS played host to around 50 groups of overseas visitors who came

to learn from our experiences and to share theirs. In addition we hosted an international

seminar on census methodology, the 50th anniversary meeting of the International

Association for Research in Income and Wealth (IARIW) and the Paris Group on Labour

and Compensation.

Preparations were underway for the Heads of the World Health Organisation

Collaborating Centres for the Classification of Diseases which will take place in

October this year.


ABOUT THE OFFICE FOR NATIONAL STATISTICS (ONS)

Richard and Roswitcha Gadd, and their children,

Tristan and Tamsin, are about to move into their new

home, a larger flat with a garden, close to where

they are currently living. ONS processes economic

data to help make decisions on interest rates,

which in turn affect mortgage repayments. In

addition, it conducts surveys which monitor

changes in household composition, and collects

household expenditure data on housing, goods and

services. Every ten years ONS also carries out

the Census in England and Wales, the next of which

will take place in 2001. The Census covers the

entire population and provides information on

family sizes and the type of housing they occupy.

Richard and Roswitcha Gadd, and their children,

Tristan and Tamsin, are about to move into their new

home, a larger flat with a garden, close to where

they are currently living. ONS processes economic

data to help make decisions on interest rates,

which in turn affect mortgage repayments. In

addition, it conducts surveys which monitor

changes in household composition, and collects

household expenditure data on housing, goods and

services. Every ten years ONS also carries out

the Census in England and Wales, the next of which

will take place in 2001. The Census covers the

entire population and provides information on

family sizes and the type of housing they occupy.

Reliable statistics are necessary for good public management and accountability. One role

of our outputs is to provide the information to allow the performance of government to

be monitored. It is also important that we demonstrate that the statistics and registration

services we provide are produced efficiently.This third Annual Report and Accounts allows

Parliament and all users of our services to monitor our performance.

The following goals, established when ONS was set up, form a core of the ONS

Vision and Values and remain relevant to our business strategy :

TO IMPROVE THE QUALITY, RELEVANCE AND ACCESSIBILITY OF OUR SERVICES

TO ALL CUSTOMERS;

TO IMPROVE PUBLIC CONFIDENCE IN THE INTEGRITY OF OUR OUTPUTS;

TO MINIMISE THE BURDEN ON THOSE SUPPLYING INFORMATION, SUBJECT TO

THE NEEDS OF GOVERNMENT AND SOCIETY FOR HIGH QUALITY INFORMATION;

TO IMPROVE VALUE FOR MONEY AND OPERATE EFFICIENTLY AND

EFFECTIVELY; AND

TO MAINTAIN AND DEVELOP A WELL-MOTIVATED WORKFORCE.

Our annual targets, agreed with the Chancellor of the Exchequer, are designed around

these goals.

1998–99 was overshadowed by the problems with the AEI and this is reflected in our

major government customers’ assessment of our performance. However overall they were

satisfied that our performance had generally met the target. Our performance against the

other targets was good and in the case of the compliance plan and efficiency savings both

targets were exceeded. In a few cases we missed the target marginally. Performance

against all the targets is reported in Annex A on page 24.

1998–99 was a busy year on both the statistical and registration fronts. Despite a

considerable agenda of change and development, the staff at ONS ensured that the

regular outputs, on which our customers rely, were produced on time.

Our performance towards achieving our objectives is considered in the next section.

Goals A–C are considered separately for our statistical and registration services. Improving

value for money and maintaining a well-motivated workforce (goals D and E) are

reported across the office.

A B O U T T H I S R E P O R T


A:

B:

C:

D:

E:

Amanda Thom and three of her six children

(Stuart, Isaac and David) unpack their weekly

shop. ONS undertakes the Family Expenditure

Survey and maintains the Retail Prices

Index (RPI) – an important barometer of the

UK economy which measures the impact of

inflation on family budgets. Another ONS

service is the Retail Sales Index (RSI),

which monitors the spending patterns of

the population.

Amanda Thom and three of her six children

(Stuart, Isaac and David) unpack their weekly

shop. ONS undertakes the Family Expenditure

Survey and maintains the Retail Prices

Index (RPI) – an important barometer of the

UK economy which measures the impact of

inflation on family budgets. Another ONS

service is the Retail Sales Index (RSI),

which monitors the spending patterns of

the population.


TO ALL CUSTOMERS (A)

Improving the quality of service is a constant challenge for staff throughout the office. Even

maintaining existing quality is a major task, as systems have to be adapted to monitor a

rapidly changing society.The introduction of the euro and the growth in Internet trading

are just two examples of how the economy is changing.

Much of our work involves the regular collection, analysis and production of statistical

information at monthly, quarterly and annual intervals.The majority of the 300 First

Releases and Press Releases and 421 publications issued during the year relate to our

statistical outputs. A lot of effort goes into producing what may, on the face of it, seem

routine outputs. However, we are constantly looking for ways to improve the thousands of

series that underlie the headline figures – for example the Retail Prices Index (RPI) and

the Gross Domestic Product (GDP) – and many of these improvements are not

immediately obvious to our customers.The migration of national accounts systems, from

spreadsheets onto the new Windows based version of the Central Shared Database

(CSDB) is one such example. It brings the benefits of improved efficiency, consistent

approaches, improved quality and reduced training costs, nearly all of which will be invisible

to our customers.

New products and services

Each year ONS publishes approximately 400 titles. In 1998–99 the large majority

of ONS publications were published according to the pre-announced timetable

(see Annex A for detailed performance). New additions to the ONS publications

portfolio this year included: Stockbuilding, UK Trade in Services, Health Statistics

Quarterly, Sub-national Population Projections – England, Social Focus on

Women and Men and Tracking People: A Guide to Longitudinal Social Sources.

The full range of ONS publications is shown in Annex D on page 28.

Despite much improvement 1998 is likely to be remembered for the decision to suspend

the AEI.This occurred after major shortcomings were found in a revised series introduced

in 1998. More details on the AEI suspension and subsequent review are given in Annex C

on page 27.

On the positive side a number of improvements were made in the year.The major

projects are outlined below in the main statistical themes.

COMMERCE, ENERGY AND BUSINESS

ONS has worked closely with users to understand their requirements and considerable

planning has gone into the development of a package of improvements to enhance a

range of business and economic statistics.

A new single whole economy Annual Business Inquiry replaces eight previous annual

structural inquiries improving coherence between data from the different sectors of the

economy. A new Trade in Services publication was introduced meeting the needs of the

Department of Trade and Industry (DTI) and the Treasury but has also proved a valuable

source to a much wider range of users. A prototype corporate services price index was

published in 1998, placing ONS among the leading group of nations in the development of

service sector price indices.

All business and macro-economic indicators were rebased in 1998 so that they now

more closely reflect the changed industrial structure.

S TAT I S T I C A L AC T I V I T I E S


GOAL

THE ECONOMY

The publication of the Blue and Pink Books in September 1998 saw the culmination of

several years of planning for the introduction of the National Accounts on the European

System of Accounts (ESA 95).This was the most far-reaching revision to the National

Accounts since they were set up in the 1950s. It involved the Blue Book, Pink Book, Input-

Output tables, Concepts Sources and Methods, Introducing ESA and Sector Classification

Guide, all of which were produced to deadline, together with the First Releases,

background briefing and an electronic dataset. Nearly 2,000 copies of the Blue Book were

sold.The UK was the first EU Member State to publish accounts on the ESA 95 basis with

a complete back series.

In addition to taking on the ESA 95 changes, the estimates published in the 1998 Blue

Book were rebased onto 1995 and included the full effects of the new business register.

The new standards are designed to give the accounts a clearer and more up-to-date

framework to allow international comparisons. A series of explanatory publications and

seminars explaining the changes for major users of these economic data preceded the

publication.This educative programme resulted in a positive response from users.

Improvements continue to be made despite the changes to the Blue Book being the

most comprehensive since the National Accounts were started. During work on BB98 it

became clear that other substantive revisions would be needed to the accounts soon; in

part to take account of feedback from users (especially Eurostat) on the methodologies

and presentation used.

In February 1999 we published the RPI Technical Manual, a complete explanation of

methodology used in compiling the widely used but not always fully understood Retail

Prices Index. Subjects covered in the manual include price collection, validation and

sampling procedures, and special indices.

HEALTH AND CARE

Customer involvement is an important element of ensuring we provide the best possible

service. A new user group, the Public Health Statistics Advisory Committee, met for the

first time in May 1998. It includes members from other government departments, the

NHS and academic institutions and will advise ONS on the direction of our statistical

work in public health.This new committee joins the network of such groups covering our

activities in business statistics, national accounts, financial statistics, gender statistics and

registration services.

Extending the use of existing data is an important aspect of our work. In February 1999

we published an easy to use guide on longitudinal data aimed at encouraging better use of

existing data sources, and directing potential users to sources that are available for analysis.

In May 1998 we published the results of a study, Health of the Elderly: a General

Household Survey (GHS) follow-up for the Department of Health, primarily designed to

investigate the feasibility of collecting longitudinal data from which healthy active life

expectancy (the expected number of years of disability-free life) could be estimated.

LABOUR MARKET

Following extensive consultation the presentation of monthly labour market statistics was

extensively enhanced in the April 1998 First Release.This was mirrored in a new format

for Labour Market Trends in the May 1998 edition. After six months the release was

reviewed, again through customer consultation, and some further improvements agreed.

To coincide with the launch of Labour Market Trends Quarterly Supplement the

publication of the full Labour Force Survey quarterly databases was brought forward by

two months.

To provide a more rounded and informative picture of the labour market we have also

produced a range of pilot small area estimates which we are currently validating and

assessing with customers.


POPULATION AND MIGRATION

Mid-year population estimates by age and sex for England and Wales at the national and

sub-national level were produced for the reorganised local authority boundaries.

We can now better meet the needs of customers for our international migration

estimates through the introduction of a new computer system.The new system allows

greater flexibility for delivering customer specified outputs.

SOCIAL AND WELFARE

In partnership with the Equal Opportunities Commission (EOC) we published Social

Focus on Women and Men in October 1998. Social Focus on Women and Men is the

second collaboration with the EOC.The partnership with EOC gives the opportunity to

improve coverage, quality and accessibility of gender disaggregated statistics by pooling our

experience and expertise.

In another collaborative venture, ONS and the Economic and Social Research Council

(ESRC) published the new government social classification. It is designed to replace the

two current classifications based on social class and socio-economic groups in 2001. All

official government statistics are expected to use the new classification once it is fully

implemented and it is likely that others outside government will also choose to use it as it

becomes established.The new classification is based on employment conditions and

relationships, which are now considered to be central to describing the socio-economic

structure of modern societies.The use of a single occupation-based social classification will

contribute to the government’s determination to use joined-up government to tackle

social issues by helping to explain variations in health and social behaviour and attitudes in

society in a coherent way.

Through the year our work has also been integral to a number of cross-departmental

initiatives. One way in which we help is through the analyses and reports based on the

over 30-year-old Longitudinal Study (LS).With a sample size of 600,000 drawn from the

total population, its coverage and scope provides a unique dataset. In the past year the

findings from the LS have fed into major reviews of adult health and health inequalities,

and into the formation and development of policy in areas such as social exclusion, the

elderly and the family.The decision of the LS Review to update it with data from the

2001 Census, is expected to increase greatly its value for developing policies in the

next millennium.

HOUSEHOLD SURVEYS

ONS is also a foremost supplier of quality survey research and advice on survey methods

to government and the public sector. In 1998–99 we carried out nine large continuous

surveys and over 25 ad hoc surveys.The General Field Force interviewers dealt with a

greater volume of units for interview during 1998–99: over 150,000 – an increase of 28

per cent on the previous year.These included elements of: survey design; sampling; data

collection; processing; analysis; and interpretative commentary.The main outputs of our

social survey work are survey datasets and published interpretative reports. In addition, we

carried out methodological research and provided expert advice and guidance across the

ONS and other government departments, and to the wider research community.

ACCESSIBILITY TO ALL CUSTOMERS

Accessibility is a cornerstone of ONS’s business strategy and more of our customers are

seeking information from non-paper sources. Many of our publications are also available in

CD-ROM format and electronic dissemination is becoming an important medium for our

outputs.The new ONS website design went live on 27 April 1998. It provides background

material and briefing papers that will interest professional statisticians as well as more

general information.The ONS website links to the Government Statistical Service (GSS)


Lorraine Streater, Damian Braganza,

Bose Akomolafe and Beverley Botting

between them have worked for ONS

for a total of 69 years. ONS

holds a vast amount of employment

information. Nearly all the

information comes from sample

surveys like the Labour Force

Survey and other sources such

as monthly records of the

number of unemployed benefit

claimants. The Labour Force

Survey tracks topics such as employment, unemployment, job-related training and

jobsearch methods, and patterns in equal opportunities in the workplace. The Annual

Employment Survey and the New Earnings Survey collect details of jobs and earnings

from employers each year.

Lorraine Streater, Damian Braganza,

Bose Akomolafe and Beverley Botting

between them have worked for ONS

for a total of 69 years. ONS

holds a vast amount of employment

information. Nearly all the

information comes from sample

surveys like the Labour Force

Survey and other sources such

as monthly records of the

number of unemployed benefit

claimants. The Labour Force

Survey tracks topics such as employment, unemployment, job-related training and

jobsearch methods, and patterns in equal opportunities in the workplace. The Annual

Employment Survey and the New Earnings Survey collect details of jobs and earnings

from employers each year.

website, which is a focal point for access to official UK statistics.The launch of StatBase, the

home for the statistical data, on the Internet on 1 October 1998 drew the headline

‘A must for any researcher or actuary’ in the Mail on Sunday. Since its launch

approximately 3,500 users have been visiting the StatBase site each week.

National Statistics Information and Library Services (NSILS) provides access to the full

range of statistics for visitors to our Newport and London sites. Members of the public

are welcome to use the library facilities for their research.We also make datasets available

to the Data Archive at the University of Essex for further analysis as well as providing

access electronically to our data through private providers such as NOMIS.

TO IMPROVE PUBLIC CONFIDENCE IN THE INTEGRITY OF OUR OUTPUTS (B)

THE FUTURE OF OFFICIAL STATISTICS

The consultation on the Green Paper, Statistics – A Matter of Trust, ended in May 1998.

The public consultation opened up a wide-ranging debate on how best to set the

framework to deliver official statistics which are trustworthy and seen to be so.

A Government response to the Green Paper has been delayed awaiting the outcomes

of the ONS Efficiency Review and the reports on the AEI and the Treasury Select

Committee’s First Report, Session 1998–99, Office for National Statistics. A White Paper is

expected shortly.

Previous criticism of the labour market statistics had an adverse effect on official

statistics generally.The revised booklets, How exactly is Unemployment Measured?, and a

new one, How exactly is Employment Measured?, were produced this year, together with a

new User Guide to Labour Market Statistics Releases, to help users better understand

how the figures are compiled.

Although the AEI suspension has understandably knocked public confidence it is

reassuring that the bulk of our statistical outputs are accepted as authoritative.


THE NEEDS OF GOVERNMENT AND SOCIETY FOR HIGH QUALITY

INFORMATION (C)

ONS has a responsibility to ensure that the burdens we place on business respondents to

all government surveys are kept to a minimum, subject to the needs of government and

society for high quality information. Compliance planning is an integral part of ONS’s

business planning process. In 1998–99 compliance costs were estimated at £20.5 million

against a target of £20.7 million.Through improved sampling methods we have been able

to reduce the number of companies required to participate in statutory surveys. In the

second year of the introduction of the Osmotherley guarantee for small businesses (firms

employing less than 10 people included in surveys only once every four years), the

guarantee was breached in only 119 cases, where it was vital for statistical purposes.

Data supply to the population estimates has also been made easier for suppliers.

Flexible input methods have been developed for a number of systems which allow data

take on in a form that is the most convenient for the supplier.Through closer contact with

suppliers we have helped to eliminate problems before they arise in live data transfer.We

are also increasing our take on and exchange of data in electronic format.

As a result of a sample optimisation project carried out for us by Southampton

University we have been able to implement a more efficient International Passenger

Survey (IPS) design.We have also improved the survey design on the Vehicle Occupancy

Survey which has made it more cost effective.


GOAL

GOAL


The General Register Office’s main outputs are:

› advice and guidance to the public, registrars, local authorities, ministers, MPs

and government officials;

› an archive of all births, marriages and deaths in England and Wales since 1837

and certain births, marriages and deaths abroad;

› certified copies (certificates) of birth, stillbirth, adoption, marriage and death

register entries (vital events);

› the Adopted Children’s register and Adoptions Contact Registers; and

› the Family Records Centre (providing a public search facility for indexes of

vital events).

The National Health Service Central Register’s main outputs are :

› the database of all patients registered with a GP in England and Wales;

› the provision of information from the database for use in primary health care;

› the preservation of historic indexes and registers; and

› the provision of services to meet customers’ needs.


TO ALL CUSTOMERS (A)

The General Register Office (GRO) has been involved in a number of joined-up policy

initiatives across government including family policy, identity and fraud. Casework has

increased significantly in the past few years and this year was no exception.

The Home Office consultation paper, Supporting Families, recommended a review of civil

registration. A Review was announced in December 1998 and a Project Board has been

set up to oversee the process of preparing a consultation paper.Work has begun with a

series of discussions with key stakeholders, such as registrars, genealogists, local authorities

and other government departments, in advance of the wider public consultation.

In April 1998 we employed Qualtech to act as a mystery shopper to evaluate the

services provided by the GRO. Overall the results were positive and the exercise is to be

repeated again this year. Qualtech also supplied more detailed information that has been

used as part of our training programme.

The number of visitors to the Family Records Centre (FRC) has continued to increase.

On average in excess of 8,000 people visit every week with Saturday becoming one of

the busiest days.The number of applications made in person have decreased whilst those

by phone, e-mail and post have increased.This is in line with our strategy aimed at

relieving congestion at the FRC and supplying a service to the public which is not driven

by the need to apply in person.

Preparations for the introduction of the new registration service software (RSS2000)

have been underway.This will replace software used in register offices which is not Year

2000 compliant. Roll-out of RSS2000 to the 600 register offices in England and Wales is

due to begin shortly.

TO IMPROVE PUBLIC CONFIDENCE IN THE INTEGRITY OF OUR OUTPUTS (B)

The GRO’s involvement in anti-fraud initiatives continued to increase in 1998–99. A

system for regular liaison and exchange of information with the UK Passport Agency and

the Department of Social Security was set up and has proved to be successful in the

discovery and investigation of a number of frauds.Work commissioned by the Ministerial

group set up as a result of the Green Paper, Beating Fraud is Everyone’s Business, required

a significant amount of input on civil registration.

R E G I S T R AT I O N AC T I V I T I E S

GOAL

GOAL

Alongside the roll-out of the RSS2000 the GRO has begun to phase in a new

background design for birth, stillbirth and death certificates.The new design is a result

of a review of certificate security and will provide better protection against forgery

and counterfeit.


THE NEEDS OF GOVERNMENT AND SOCIETY FOR HIGH QUALITY

INFORMATION (C)

The legislation covering civil registration is very prescriptive and prevents the registration

service operating at premium efficiency.The Review of Civil Registration’s aim is to provide

a service that is responsive to the needs of modern society, capable of adapting and

evolving with technological advances.This could contribute to the joined-up Government

initiative of citizens providing information only once to government. Fundamental change

will depend on legislative reform. In the meantime the rationalisation of registration

districts has helped local authorities to amalgamate registration districts, thereby increasing

efficiencies for local authorities and the public.

Following a public consultation on its draft the Welsh Language Board approved

the ONS Welsh Language Scheme. Prepared under the Welsh Language Act 1993

it sets out how we will put into practice the principle of treating the Welsh

language on an equal basis.

Mae’r Swyddfa Ystadegau Gwladol (SYG) yn croesawu pob gohebiaeth yng

Gmraeg. Ein bwriad yw cynnig gwasanaeth dwyieithog ar draws y cyfan o

weithgareddauir SYG. Dyma’r rhifau ar gyfer ymholiadau Cymraeg:

Ymholiadau am gofrestu sifil: 0151 471 4575

Ymholiadau ystadegol a rhai cyffredinol: 01633 813381

Dylai ymholiadau ysgrifenedig ar gofestru gael eu cyfeirio i’n swyddfa yn

Southport a phob ymholiad arall i swyddfa Casnewydd. Mae’r cyfeiriadau ar y

tu mewn i’r clawr. Mae copiau o’r cynlln ar gael drwy gysylltu ein llyfgell yng

Nghasnewydd.


GOAL

Darra Singh is Chief Executive of Hexagon

Housing Association. He is pictured with

his Senior Administration Officer, Mary

Scanlan, and Finance Director, Chris

Birchall, on the site of their new offices

in South London. ONS’s statistics on

industry and commerce provide a wide range of information on the structure of the UK

economy covering employment, wages, sales and factory gate prices. Data can be used in

assessing an area for relocation in terms of potential competitors, business customer

bases, supply businesses, available workforce, and remaining market potential.

Darra Singh is Chief Executive of Hexagon

Housing Association. He is pictured with

his Senior Administration Officer, Mary

Scanlan, and Finance Director, Chris

Birchall, on the site of their new offices

in South London. ONS’s statistics on

industry and commerce provide a wide range of information on the structure of the UK

economy covering employment, wages, sales and factory gate prices. Data can be used in

assessing an area for relocation in terms of potential competitors, business customer

bases, supply businesses, available workforce, and remaining market potential.

TO IMPROVE VALUE FOR MONEY AND OPERATE EFFICIENTLY AND

EFFECTIVELY (D)

Efficiency savings achieved by ONS in 1998–99 amounted to £9.26 million.These were

gained by consistent efforts across all Groups to improve on their target figures, together

with the savings now starting to accrue from rationalisation of our London accommodation.

Over the past three years, since the creation of ONS, we have achieved efficiency savings

of £22.5 million.

ONS EFFICIENCY REVIEW

To identify future efficiency savings for reinvestment into improved outputs a review was

undertaken by KPMG in September 1998 with the following terms of reference:

To review the scope for improving the efficiency with which ONS delivers its

planned outputs; and to identify quantified proposals for savings. The review will

examine the scope for radical changes for both direct service delivery and support

services, for example through innovative use of technology, increased public-

private partnerships, business process re-engineering and rationalisation.

KPMG presented their findings to an independent Steering Group, chaired by Peter Ellwood of

Lloyds-TSB, who reported their recommendations to the Economic Secretary to the Treasury

(EST) on 5 February 1999.The EST approved the recommendations on 24 February 1999.An

Efficiency Review Programme Steering Group has been set up to implement a programme of

action to deliver the savings identified of around £20 million per year after four years.

2001 CENSUS

Our public service agreement commits us to achieving a good value for money Census in

2001.The preparation for Census day 2001 has been progressing steadily.The results of

the Census Test, carried out in June 1997, were completed this year and had a large input

into the decision-making process in relation to areas such as form design and data

collection. In the drive to improve the cost-effectiveness of the operation we are

harnessing outside experience.The results from the Census Test helped us to design the

specification for the contracts. Five major contracts, valued at a total cost of around £50

million, were awarded to handle a number of key activities including the printing,

distribution, collection and processing of the forms and the field staff payroll.

The Census Test was also used to test the acceptability of questions related to sensitive

issues.This work informed the 2001 Census White Paper which was laid before Parliament

on 4 March.The year ended with the culmination of the planning for the Census Dress

Rehearsal which is to be conducted in April 1999.

OFFICE AUTOMATION

In September 1998 the ONS Policy Board agreed a three-year vision for ONS office

automation (OA) that:

ONS staff will be skilled and knowledgeable and make cost-effective use of the

OA environment. Lotus Notes will underpin their day-to-day activities, providing

access to all the information, systems and communications resources they need

and supporting process control and work-flow management. It will support these

activities regardless of whether staff are working at their desk, at another ONS

location or away from the office. In-house paper usage will be reduced to 25 per

cent of 1998 levels and ONS will reduce its expenditure on software licenses for

the OA environment by 50 per cent.

O F F I C E - W I D E AC T I V I T I E S


GOAL

Ernest Peck is 79 and

sells newspapers from a

stand outside the Bank of

England, where some of the

key national macroeconomic

decisions are made. ONS

economic statistics play

an important role in the management and monitoring of the economy. They are used for

analyses within government, the City, business and academia and, directly or indirectly,

have a bearing on citizens like Ernest whose lives are affected by changing economic

conditions. Data on money supply and credit, banks and building societies, interest and

exchange rates are published in the monthly Financial Statistics.

Ernest Peck is 79 and

sells newspapers from a

stand outside the Bank of

England, where some of the

key national macroeconomic

decisions are made. ONS

economic statistics play

an important role in the management and monitoring of the economy. They are used for

analyses within government, the City, business and academia and, directly or indirectly,

have a bearing on citizens like Ernest whose lives are affected by changing economic

conditions. Data on money supply and credit, banks and building societies, interest and

exchange rates are published in the monthly Financial Statistics.

This vision represents a significant change in the way ONS operates and offers substantial

opportunities for improving our efficiency, effectiveness and quality.

Planning for the Year 2000 continued. During the year the central Year 2000 team

resources were increased by 50 per cent.

To ensure that staff are aware of the potential problems of the Millennium Bug we held

a series of workshops covering: testing strategy; risk assessment and contingency planning;

and millennium business planning.

We have an extensive programme to ensure all ONS systems are Year 2000 compliant.

At the end of March 1999 we had completed 70 per cent of IT systems and 75 per cent

of embedded systems.We have also prepared draft Millennium Business Plans.

Work on compliance continues into 1999–2000. Our target date for completion of

business critical systems is September 1999.

TO MAINTAIN AND DEVELOP A WELL-MOTIVATED WORKFORCE (E)

ONS invited all staff to participate in the annual Staff Perception Survey in late 1998.

73.6 per cent of staff completed the questionnaire; an increased response rate from 1997

(72.9 per cent). Overall responses to the full range of questions showed an improvement

in ratings of 5 to 6 per cent.

The specific survey question ‘my job makes good use of my relevant skills and abilities’ is

used as a measure of this goal.The rating improved but did not meet the target. See

Annex A on page 24 for details.

Investors in People

The ONS office in Southport and the Family Records Centre in London received

Investors in People accreditation in July 1998. At the same time the remainder of

the Office was undergoing its pre-assessment. Following on from the results of

that pre-assessment, action plans were completed to achieve our goal of full

accreditation. Taking forward the recommendations of the ONS Efficiency Review

will provide us with an additional challenge but we are committed to developing

and carrying forward work resulting from the review in a way that is consistent

with achievement of IiP.


GOAL


The next few years will see considerable change for ONS.The ONS Efficiency Review

recommendations focused on reducing costs through a combination of further

streamlining of our activities and working more closely with appropriate private sector

organisations.This was expected to lead to the transfer of around 680 jobs to the private

sector under TUPE arrangements and to 350 posts which would no longer be required.

This does not take account of the new posts that will be created as a result of recycling

the savings into new outputs.The programme of action designed to deliver these savings

is underway.

The management team at the top of the office has also been changed as a result of the

Efficiency and Average Earnings Reviews.Two new statistical Directorates, economic and

social, have been created to improve coherence, and the post of Director of Methodology

and Quality has been created to strengthen quality control. Registration will report direct

to the Registrar General,Tim Holt. A new post of Director of Finance and Corporate

Services has been created to lead the change programme.These posts will be advertised

and filled in the coming year.The four new directors will form, with Tim Holt, the new

ONS Executive Committee.

CROSS-CUTTING COMMITTEES

› Human Resources Committee

› Information Systems Committee

› Methodology and Quality Committee

SENIOR MANAGEMENT PAY COMMITTEE

AUDIT COMMITTEE

The ONS Audit Committee provides the assurance to the Director on its internal

audit programme.

Throughout these organisational changes the regular work of producing the current and

future new statistical and registration services on which our many customers depend will

continue.The ONS Business Plan 1999–2002 outlines our plans for the next three years

detailing how we will continue to develop our services to meet the changing needs of our

customers.These include:

› developing the Public Sector accounts, balance sheets and fiscal indicators;

› implementing the ESA requirements for regional accounts;

› developing a monthly index of service sector output;

› enhancing trend and longitudinal analyses;

› improving migration statistics, population estimates and projections;

› developing the Social Focus series;

› introducing new analyses covering variations in demography and health;

› enhancing analysis on cross-cutting issues;

› providing support on the Bill dealing with Welsh Language Registration issues and

changes to marriage law in the Immigration and Asylum Bill;

› developing the ‘Traceline’ service; and

› reviewing the future of the NHS Central Register in the context of the NHS wider

information needs.

1999–2000 includes the challenge of beating the Millennium Bug.We are working to

ensure that all of our computer systems are Year 2000 compliant and that we have

contingency plans to deal with any problems that may emerge. Our Millennium Business

Plans are aimed at minimising disruption.

T H E F U T U R E

ONS GOVERNANCE

Executive Committee

plus 2 non-Executive Directors

The Census Dress Rehearsal took place in April 1999. It provides the opportunity to test

the procedures for the Census proper in 2001.The results of this exercise will help us fine

tune the arrangements for April 2001.

The registration review is expected to come forward with some radical proposals to

bring the registration service up to date. However, fundamental change will depend on

legislative reform.

The Government response to the Green Paper, Statistics – A matter of trust, is

expected to be published soon.The future of National Statistics will have an impact not

only on ONS but also across the whole of the Government Statistical Service. Devolution

will in addition change the environment in which we operate.

With all the changes expected to take place, within the Office and externally, it is

particularly important that we remain flexible to changing needs.Throughout all these

changes our five goals remain key in driving forward our work programme.


1998-99 TARGET

TO GOVERNMENT:

To receive formal recognition from HMT,

DH, DTI and DfEE that performance has

improved in line with negotiated

concordats and targets.

TO THE CITIZEN:

To respond to all public enquiries about

statistical activities within ten days.

TO BUSINESS:

To increase from the 1997–98 level the

number of businesses using statistics issued

by ONS.

To increase from the 1997–98 level the

percentage who express themselves as

satisfied with the service provided.

TO ALL CUSTOMERS:

To release all publications in accordance

with pre-announced dates.

To meet all detailed targets for the

registration service.

To continue to measure public confidence

in official statistics and public recognition of

ONS and to take forward the proposals

set out in Statistics: A Matter of Trust.

SUCCESS CRITERIA

TO IMPROVE THE QUALITY,

RELEVANCE AND ACCESSIBILITY OF

OUR SERVICES TO ALL CUSTOMERS

TO IMPROVE PUBLIC CONFIDENCE IN

OUR OUTPUTS

PERFORMANCE

See opposite for comments from HMT,

DH, DTI and DfEE.

Over 130,000 substantive enquiries

answered within the target response date.

Number of businesses using ONS statistics

rose to 30.7 per cent.Those describing

themselves as very or completely satisfied,

fell to 22.2 per cent, however the mean

satisfaction score rose from 5.0 to 5.1.

None of these changes are statistically

significant.

All high profile First Releases were

published to schedule. Of the 421

publications published by ONS, 91 per

cent were released in accordance with

the pre-announced dates.The reasons for

delays to 31 reports were:

a: delays in data processing – 17 reports

b: problems during the printing stage –

three reports

c: date announced before production

schedules finalised – 11 reports

(the method of reporting release

dates changed for some titles.This led

to some incorrect information being

announced in the early part of the year)

GRO met its targets for service availability.

93 per cent of casework was dealt with

by the target date (five days for urgent

correspondence and 20 days for other).

84 per cent of certificates were provided

within the stated target time.There were

particular difficulties in providing (non-

urgent) postal certificates primarily due

to a 22 per cent rise in demand.

In spite of frequent reference to ONS in

the media in the last year, and extensive

coverage of the problems with the Average

Earnings Index, public awareness of ONS

as the body mainly responsible for

government statistics was, at 5 per cent,

the same in March 1999 as in the two

ANNEX A – PERFORMANCE AGAINST TARGETS 19 9 8 – 9 9


1998-99 TARGET

To limit business compliance costs to no

more than £20.7 million in accordance

with the compliance plan.

To achieve the efficiency improvements

identified in the efficiency plan totalling

£6.2 million.

To conduct a staff perception survey to

measure progress from 1997–98 and to

achieve an improved rating of over 65 per

cent on the question ‘my job makes good

use of my relevant skills and abilities’.

SUCCESS CRITERIA

TO IMPROVE PUBLIC CONFIDENCE IN

OUR OUTPUTS (CONT)

TO MINIMISE THE BURDEN ON THOSE

WHO SUPPLY US WITH DATA,

SUBJECT TO THE NEEDS OF

GOVERNMENT AND SOCIETY FOR

HIGH QUALITY INFORMATION

TO IMPROVE VALUE FOR MONEY AND

OPERATE EFFICIENTLY AND

EFFECTIVELY

TO DEVELOP AND MAINTAIN A WELL

MOTIVATED WORKFORCE

PERFORMANCE

previous years.There was also little change

between 1998 and 1999 in public

perceptions of the accuracy of the RPI or

of the unemployment figures.

The difficulties with the AEI appear to

have had little impact on the general

public: only 41 per cent said that they

thought the AEI was generally or

sometimes misleading, compared with 53

per cent in relation to the RPI and as many

as 66 per cent in relation to the

unemployment figures.

The White Paper on National Statistics

has not yet been published.

Compliance costs were estimated at

£20.5 million.

Efficiency savings of £9.26 million were

identified.

Overall responses showed an improvement

in ratings of 5 to 6 per cent. A rating of 64

per cent was achieved against the specific

question.This was an increase on last year’s

rating but it failed to meet the target.


Assessment of performance from major departmental customers

HMT recognised that many aspects of the service it received had been satisfactory

or more than satisfactory, but in some respects expectations had not been met.

DH acknowledged that our performance against agreed targets has improved in

five out of 11 Service Level Agreements (SLA), remained the same in five; and

slightly deteriorated in one (largely the result of loss of skilled staff).

DTI reported that in three areas ONS service was excellent, in 19 areas it was

good, in three it was satisfactory and in four it was unsatisfactory. Co-operation

between colleagues in ONS and DTI was good.

DfEE’s performance assessment underlying the concordat emphasises four central

aspects of ONS service: delivery of data; consultation and communication;

technical advice; and data quality; as well as some specific issues for the current

year. DfEE’s assessment is that overall performance is good and ONS has sought

to improve quality on a range of fronts.

Gill Whitworth is 59; she had polio

when she was 17 and requires

personal assistance 24 hours a day.

Her disability doesn’t stop her

from being a member of a number of

committees, publishing the local

church paper and singing in a

choir. She lives with her mother, Evelyn, who is 92. In the UN International Year of the Older

Person, ONS’s Social Focus on Older People reports on experiences, lifestyles and attitudes

of older people in the UK today.

Gill Whitworth is 59; she had polio

when she was 17 and requires

personal assistance 24 hours a day.

Her disability doesn’t stop her

from being a member of a number of

committees, publishing the local

church paper and singing in a

choir. She lives with her mother, Evelyn, who is 92. In the UN International Year of the Older

Person, ONS’s Social Focus on Older People reports on experiences, lifestyles and attitudes

of older people in the UK today.

Number of staff recruited on either a permanent or fixed-term basis not including

casual appointments.

PAY NUMBER PERCENTAGE OF PERCENTAGE PERCENTAGE WITH

BAND RECRUITED ETHNIC MINORITIES OF WOMEN DISABILITIES

SCS 1 0 100 0

C4 5 20 60 20

C3 8 0 50 0

C2 2 0 50 0

C1 3 0 66 0

B2 9 0 44 0

B1 33 0 50 0

A2 199 1 65 2

A1 73 1 67 0

Exceptions permitted by the Civil Service Commissioners’ Recruitment Code during

1998–99 were:

› Nine cases where casual staff appointments were extended beyond 12 months up to 23

months. All these extensions were to enable the staff concerned to complete projects.

› Three TSOs had their contracts converted from casual to fixed term.

› One secondee joined the department.

› Three members of staff joined ONS on re-employment terms.

In 1998 ONS introduced major revisions to the Average Earnings Index (AEI).These were

planned to correct for various shortcomings of the Index including the need to keep pace

with the changing structure of the economy. Improvements to the coverage of companies

in expanding parts of the economy started in April 1998 with first results published in

August 1998. In October 1998 further changes were introduced.

Whilst preparing the second set of changes it emerged that the changes to the

coverage of companies had not been applied correctly and revised figures were issued in

early October.The second set of changes in mid-October also generated concerns

amongst economic commentators about the new methodology. As a result the Chancellor

of the Exchequer commissioned a review of the changes and the Director of ONS took

the decision to suspend publication of the Index.

This programme of intensive scrutiny identified a number of shortcomings in the Index.

Some were significant in the original Index; others were accentuated in the Index of 14

October. Amongst other things, the revised methodology increased the chance that the

index could be sharply affected by wage movements in some individual firms.This scrutiny

highlighted important lessons which ONS is determined to learn.

The review was published in March 1999. At the same time, the Index was reinstated,

incorporating the revised methodology recommended in the review. In all, there were 37

recommendations spanning a range from detailed technical methodological issues to

internal management practice within ONS. A change programme has been agreed, a

programme manager at Board level has been appointed and projects have been

established to carry forward each recommendation.This will be a major task for ONS

during 1999–2000.

A N N E X B – R E C R U I T M E N T 19 9 8 – 9 9

A N N E X C – AV E R AG E E A R N I N G S I N D E X


HIGH PROFILE REGULAR OUTPUTS

– FIRST RELEASES

› Engineering Turnover and Orders

› Index of Production

› Machine Tools

› Motor Vehicle production

› Producer Prices

› Retail Sales

› Acquisitions and Mergers involving

UK Companies

› Distributive and Services Trade

› GB Cinema Exhibitors

› Institutional Investment

› Stocks (provisional; final)

› Business Enterprise Research and

Development

› Gross Domestic Expenditure on R&D

› Overseas Direct Investment

› UK Trade

› Public Sector Finances

› Retail Price Index

› Harmonised Index of Consumer Prices

› Balance of Trade in Goods

› Public Sector Borrowing Requirement

› Business Investments

› GDP Preliminary Estimate

› Government Deficit and Debt under the

Maastricht Treaty

› Institutional Investment

› Public Sector Accounts

› United Kingdom Balance of Payments

› United Kingdom National Accounts

› UK Output, Income and Expenditure

› Capital Expenditure (provisional)

› Capital Expenditure (final)

› Profitability of UK Companies

SUBJECT AND FREQUENCY

COMMERCE, ENERGY AND INDUSTRY

monthly

quarterly

annual

THE ECONOMY

monthly

quarterly

annual

OTHER REGULAR AND OUTPUTS

– REPORTS

› Aerospace and Electronic Cost Indices

(MM19)

› Motor Vehicle Production and New

Registrations (PM34.10)

› Producer Prices Indices (MM22)

› Retail Sales (SDM28)

› Price Index Numbers for Current Cost

Accounting (MM17)

› Assets and Liabilities of Finance Houses

and other credit companies (SDQ7)

› Insurance Companies and Trusts

Investment (MQ5)

› Product Sales and Trades reports (35 vols)

› Sector Reviews reports (4 vols)

› Stockbuilding (SQ1)

› Mineral Extraction in Great Britain

(PA1007)

› Production and Construction Inquiries -

summary volume (PA1002)

› Product Sales and Trade reports (1 vol)

› Research and Development in UK

Business (MA14)

› Sector Review reports (5 vols)

› Size Analysis of UK Businesses (PA1003)

› UK Trade in Services (UKA1)

› Economic Trends

› Financial Statistics

› Monthly Review of External Trade

Statistics (MM24)

› Retail Price Index (MM23)

› Consumer Trends

› Overseas Trade analysed in terms of

Industries (MQ10)

› United Kingdom Economic Accounts

› Economic Trends Annual Supplement

› Input-Output Balances for the UK

› Overseas Direct Investment (MA4)

› United Kingdom Balance of Payments

(Pink Book)

› United Kingdom National Accounts

(Blue Book)

ANNEX D – ONS PUBLISHING APRIL 1998 – MARCH 1999


HIGH PROFILE REGULAR OUTPUTS

– FIRST RELEASES

› Integrated Labour Market statistics

–

–

› Weekly deaths in England and Wales

› Legal Abortions

› Legal Abortions

› Cancer Registrations

› Mortality Statistics

› Deaths – all ages: infant; perinatal

› Sudden Infant Deaths

› Population Estimates – UK, mid-year

› Births

› Marriages and Divorces

› International Migration (UK)

› Population Projections

› Family Expenditure Survey

› UK Electoral Statistics – local

government electors

› Welsh Electoral Statistics

› Overseas Travel and Tourism

–

–

–

–

SUBJECT AND FREQUENCY

LABOUR MARKET

monthly

quarterly

annual

HEALTH AND CARE

monthly

quarterly

annual

POPULATION AND MIGRATION

quarterly

annual

SOCIAL AND WELFARE

annual

TRANSPORT, TRAVEL AND TOURISM

monthly

quarterly

annual

REFERENCE AND COMPENDIA

monthly

annual

OTHER REGULAR AND OUTPUTS

– REPORTS

› Labour Market Trends

› Labour Force Survey quarterly supplement

› Annual Employment Survey

› New Earnings Survey

–

› Health Statistics Quarterly

› Legal Abortions (Monitor)

› Abortions Statistics

› Legal Abortions (Monitor)

› Cancer Registrations

› Cancer Registrations (Monitor)

› Congenital Anomalies

› Deaths by Certain Causes (Monitor)

› Key Health Statistics from General Practice

› Mortality – causes (DH2)

› Mortality – childhood (DH3)

› Mortality – general/area (DH1)

› Mortality – injury and poisoning (DH4)

› Infant and Perinatal Mortality (Monitor)

› Sudden Infant Deaths (Monitor)

› Population Trends

› Births (FM1)

› Births (Monitor)

› International Migration (UK) (MN)

› Key Population and Vital Statistics (PP1/VS)

› Marriages and Divorces (FM2)

› Divorce (Monitor)

› Marriage (Monitor)

› Electoral Statistics (UK) (Monitor)

› Family Spending

–

› Overseas Travel and Tourism (MQ6)

› Travel Trends

› Monthly Digest of Statistics

› Annual Abstract of Statistics

› Britain Handbook

› Regional Trends

› Social Trends



AD-HOC PUBLICATIONS APRIL 1998–MARCH 1999

COMPENDIA AND REFERENCE

› Focus on London

› Focus on the South West

› Gazetteer of the old and new geographies of the UK

› ESRC Review of Government Social Classifications

› Tracking People: A guide to longitudinal social sources

› Report of the 1998 Review of the Longitudinal Study

THE ECONOMY

› UK Environmental Accounts

› Economic Trends Digest of Articles

› European System of Accounts – Concepts, Sources and Methods (2 volumes)

› Introducing the European System of Accounts 1995 in the United Kingdom

› Sector Classification for the National Accounts

› Share Ownership 1997

HEALTH AND CARE

› Informal Carers

› Health in England

› Prisoners' Psychiatric Survey

› Teenage Smoking Attitudes Survey 1997

› Omnibus Survey – Smoking-related behaviour and attitudes 1997

› Omnibus Survey – Drinking; adults behaviour and knowledge in 1998

› Omnibus Survey – Contraception and Sexual Health in 1997

GOVERNMENT AND PUBLIC SECTOR

› GSS Methodology Series – (9 reports)

TRANSPORT, TRAVEL AND TOURISM

› National Travel Survey Technical Report

SOCIAL AND WELFARE

› Family Resources Survey Technical Report

› Social Focus on the Unemployed

› Social Trends Pocketbook

› Social Focus on Women and Men

› Social Trends Quarterly – Pilot Edition


FOREWORD TO THE ACCOUNTS

ACCOUNTS

NOTES TO THE ACCOUNTS

ACCOUNTS DIRECTION

STATEMENT OF AGENCY’S AND DIRECTOR’S RESPONSIBILITIES

STATEMENT OF THE SYSTEM OF INTERNAL FINANCIAL CONTROL

AUDIT CERTIFICATE

AC C O U N T S 1 9 9 8 – 9 9

32

35

40

53

55

56

58

32

INTRODUCTION

The Accounts for the year ended 31 March 1999 have been prepared on an accruals basis

in accordance with a direction given by HM Treasury dated 11 November 1997 in

pursuance of section 5(1) of the Exchequer and Audit Departments Act 1921.The

Accounts are subject to audit by the Comptroller and Auditor General.

FINANCIAL MANAGEMENT DEVELOPMENTS

The Office for National Statistics (ONS) was formed on 1 April 1996 by the merger of the

Central Statistical Office (CSO) and the Office of Population Censuses and Surveys (OPCS).

› ONS has continued to develop its financial management and accounting systems to

meet the developing needs of the organisation and the requirements of Resource

Accounting and Budgeting.

› A new Principal Finance Officer and a new Director of Finance have been appointed

and increased staff resources are now devoted to the Accounts production process

with full management reviews.

› An updated version of our Executive Information System has now been fully installed

giving managers easier access to financial information held on the main accounting system.

› A Year 2000 version of our CHAMELEON accounting software was loaded, tested and

put into operation in December. However, the software supplier subsequently advised us

of a potential Y2K problem. Action is in hand to resolve this by 31 July 1999 at the latest.

› ONS’s banking services requirements were put out to competitive tender.The

Paymaster now operates all facilities, including a EURO account.

› Reviews of account coding and overheads procedures were undertaken with new

arrangements being introduced on 1 April 1999.

› A Year 2000 compliant time recording system was developed and became operational

from 1 April 1999.

› Accounting arrangements were made for the introduction of the Government Purchase

Card on 1 April 1999.

FUTURE DEVELOPMENTS

› ONS will continue to develop its financial management and accounting systems to meet

the developing needs of the organisation, the requirements of Resource Accounting and

Budgeting, and the Green Paper, Statistics: A Matter of Trust.

› As part of the ONS Efficiency Review we will examine the options for improving the

cost effectiveness of our accounts processing work.

› A trial Resource Account will be prepared for 1998–99.

MILLENNIUM BUSINESS PLANNING

The Office for National Statistics has continued its programme of work to ensure

continuity of service to users of its services and products through the end of century date

change marking the new millennium. A member of the ONS Executive as the sponsor for

the ONS Y2K Programme chairs the programme board. Progress is monitored closely,

reporting to the ONS Executive Committee. Regular reports are sent to the Cabinet

Office via CCTA, and to the ONS Minister the Economic Secretary to the Treasury.

To provide an independent check on the state of the programme, ONS commissioned

Impact to carry out a Y2K Readiness Review in January 1999.This was followed by Internal

Audit (KPMG) completing a report in June 1999, which ONS will respond to by the end

of July.

The scope of work remaining includes:

› completion of the remaining compliance programme by the end of September

› completion of ONS Millennium Business Plans by the end of August prior to the

commencement of the Change Moratorium period that starts on 1 September

F O R E WO R D T O T H E AC C O U N T S

ONS A n n u a l R e p o r t & A c c o u n t s 19 9 8 – 9 9


› continuing to review and test contingency plans by the end of October

All of the work is planned and fully resourced from both management and financial perspectives.

The total cost of the work is expected to be £2.9million.

FINANCIAL RESULTS

For the financial year ended 31 March 1999, ONS’s gross costs were £125.7m with

income of £30.5m. Income arises from a variety of sources including sales of registration

certificates, the provision of social surveys, sales of statistical data relating to business, the

economy, population and health and the provision of services, such as the National Health

Service Central Register, to other government departments.

ANALYSIS OF NET COST OF OUTPUT

The net cost of output (see page 35), attributed on a full economic cost basis, is as

follows:£000’S

1998–99

Statistical services 86,485Register services 8,679NET COST OF OUTPUT 95,164

ACCOUNTS DIRECTION REPORTING REQUIREMENTS

The above review of Financial Management Developments and Financial Results

supplements the performance report on key targets shown in Annex A to the Director’s

Annual Report. In addition the other requirements of the schedule accompanying the

ONS Accounts Direction (including information on the background, history and activities

of ONS, details of Board members, and staffing policies) are shown in the Annual Report.

CASH MANAGEMENT

ONS is Vote funded (Class XVI,Vote 11). Provision and outturn for the year ended 31 March

1999, taking account of supplementary estimates and a cash limit adjustment, were as follows:£000’S £000’S

PROVISION OUTTURN

Running costs 126,581 121,935Other current 110 610Capital expenditure 5,817 6,050Receipts (32,368) (32,368)NET 100,140 96,227

FIXED ASSETS

ONS assets include computers and associated equipment, bespoke software developed

in-house, vehicles, office and other equipment.

ONS occupies rented accommodation in London at Drummond Gate, and Myddelton

Place. Rented accommodation is also occupied at Lancaster Court in Titchfield and at Runcorn.

Former Common User Estate property occupied in Newport,Titchfield, Christchurch,

and Southport valued at £12.826m was brought onto the Balance Sheet at 1 April 1998.

Capital Interest charge and Depreciation are charged to the Net Expenditure Account

and Revaluation to the Revaluation Reserve.

ASSETS UNDER CONSTRUCTION

Assets under construction consist of in-house bespoke software and major works undertaken to

refurbish accommodation occupied.All significant expenditure will be capitalised on completion.

CREDITOR PAYMENT POLICY

ONS is committed to the CBI prompt payment code and aims to pay all invoices within 30

days of receipt of goods or presentation of a valid invoice, whichever is later. During the period

1 April 1998 to 31 March 1999, 95.6% of all relevant invoices were paid within 30 days.

34

POLICY ON DISABLED STAFF

ONS is committed to equal opportunities for disabled staff, including full implementation

of the 1995 Disability Discrimination Act. ONS has received Employment Service approval

for the use of the ‘Two Ticks’ symbol on stationery and advertisements to denote our

positive approach to disability.We publish an Equal opportunities program for action which

includes action for staff with disabilities.

STAFF INVOLVEMENT IN THE BUSINESS

ONS recognises the CPSA, PTC, IPMS and the FDA to represent staff. Formal and

informal discussions regularly take place on a number of matters of mutual interest. Staff

are also represented on the Health & Safety Committee, working with managers to

ensure a safe working environment.

Our published Visions and Values statement recognises the need to maintain a well-

motivated workforce by development of skills, teamwork and good management. ONS

has developed a new human resources policy and is currently working towards ‘Investors

in People’ accreditation.

Monthly briefing sessions are held for all staff.These are based on a cascaded message

from the Board (the Core Brief).They provide staff with an opportunity to respond to

issues raised in the Brief and to give feedback to the Board.

ONS is committed to the continued development of equal opportunities policies. Its

policies and practices on recruitment and promotion are based on the ability of

candidates to perform the job. Full and fair consideration is given to all candidates without

regard to issues of disablement, sex or ethnic origin.

MANAGEMENT BOARD

The Management Board at 31 March 1999 consisted of:

› Dr D Holt Director, Registrar General and Head of the GSS

› Dr M Pepper Business Statistics

› Mr J Kidgell Macro-Economic Statistics and Analysis

› Mr J Pullinger Socio-Economic Statistics and Analysis

› Dr J Fox Census, Population and Surveys

› Mr J Calder Statistical Support Services

› Mr D Roberts Administration Services and Registration

› Mrs G Batchelor Non-Executive Director

› Mr J Beaumont Non-Executive Director

Dr LD Mayhew, formerly Head of Administration Services and Registration, left ONS in

July to be replaced by Mr D Roberts who moved from Socio-Economic Statistics and

Analysis where he was replaced by Mr J Pullinger.

Mrs M Berg ceased to act as a Non-Executive Director in March 1998 and was

replaced by Mrs Batchelor.

Following the Efficiency Review and with effect from 1 April 1999 the Board will

consist of Dr Holt, the Non-Executive Directors and Mr Roberts, Dr Fox, Mr Kidgell and

Mr Calder.

Dr D Holt

Director

21 July 1999



N E T E X P E N D I T U R E AC C O U N T

FOR THE PERIOD ENDED 31 MARCH 1999

1998–99 1997–98

NOTES £’000 £’000 £’000 £’000

3, 4 119,947 122,816

9 3,009 3,532

5 408 (1,175)

6 31 164

7 2,303 1,863

125,698 127,200

8 (30,534) (29,405)

95,164 97,795

The Notes on pages 40 to 52 form part of these Accounts

All activities are classed as continuing

EXPENDITURE

Running costs

Depreciation

Notional superannuation

Other non-cash costs and services

provided from other Votes

Notional interest

Gross cost of output

INCOME

Less income from services supplied in year

NET COST OF OUTPUT

AC C O U N T S

36

B A L A N C E S H E E T


AS AT 31 MARCH 1999

1998–99 1997–98RESTATED

NOTES £’000 £’000 £’000 £’000

9 45,998 26,663

10 996 507

46,994 27,170

11 5,123 4,708

722 1,635

5,845 6,343

12 (4,122) (5,456)

1,723 887

48,717 28,057

14 (60) (161)

13 (2,834) (3,285)

(2,894) (3,446)

45,823 24,611

18 41,009 24,378

19 4,814 233

45,823 24,611


Dr D Holt

Director

21 July 1999

TANGIBLE FIXED ASSETS

Fixed assets

Assets under construction

CURRENT ASSETS

Debtors and prepayments

Cash at bank and in hand

CURRENT LIABILITIES

Creditors (due within one year)

NET CURRENT ASSETS

TOTAL ASSETS LESS

CURRENT LIABILITIES

Creditors (due after more than one year)

Provisions for liabilities and charges

FINANCED BY

General Reserve

Revaluation Reserve


C A S H F L OW S TAT E M E N T

FOR THE YEAR ENDED 31 MARCH 1999

Reconciliation of net expenditure to net cash outflows from operating activities

1998–99 1997–98

NOTES £’000 £’000 £’000 £’000

95,164 97,795

9 (3,009) (3,532)

9, 10 1,390 (180)

14 (67)

9 (202) (172)

14 (3) (9)

7 (2,303) (1,863)

6 (130)

6 (31) (34)

5 (408) 1,175

13 451 (1,475)

14 (161)

11 415 (1,493)

12 1,233 (473)

92,697 89,381

92,697 89,381

4,038 3,823

(10) 4,028 (35) 3,788

96,725 93,169

128,595 123,238

(32,368) (29,795)

96,227 93,443

(415) 321

95,812 93,764

(913) 595

(913) 595

(219) (800)

415 327

(717) 122

1,162 1,040

445 1,162

NET EXPENDITURE (from the Net Expenditure Account)

Adjustment for items not involving the movement of funds:

Depreciation

Reclassifications

Adjustment for finance lease/hire purchase

Losses on sale on fixed assets

Return on investments and servicing of finance

Interest

Insurance

Audit fee

Superannuation

Decrease in provisions

Finance lease obligation

Movement in net current assets:

Increase/(decrease) in debtors

Decrease/(increase) in creditors

NET CASH OUTFLOW FROM OPERATING ACTIVITIES

CASH FLOW STATEMENT

Net cash outflow from operating activities

CAPITAL EXPENDITURE

Payments to acquire tangible fixed assets

Proceeds from the sale of fixed assets

NET CASH OUTFLOW BEFORE FINANCING

FINANCING

Payments on ONS Appropriation Accounts

Receipts on ONS Appropriation Accounts

VOTE EXPENDITURE APPROPRIATED IN YEAR

Capital element of finance lease payments

(DECREASE)/ INCREASE IN CASH

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT

Decrease in cash held in the period

New acquisition of 3 servers

Cash paid in respect of lease

Change in net funds

Net funds at 1 April

NET FUNDS AT 31 MARCH


38

N O T E S T O T H E C A S H F L OW S TAT E M E N T

NOTE 1

ANALYSIS OF CHANGES IN NET DEBT

AT OTHER AT

1 APRIL NON-CASH 31 MARCH

1998 CHANGES CASHFLOW 1999

£’000 £’000 £’000 £’000

Cash 1,635 0 (913) 722

Obligations (473) (219) 415 (277)

Total 1,162 (219) (498) 445

NOTE 2

MAJOR NON-CASH TRANSACTIONS

During the year ONS entered into a hire purchase arrangement for the acquisition of

computer equipment.



FOR THE YEAR ENDED 31 MARCH 1999

1998–99 1997–98

£’000 £’000

Net cost of output 95,164 97,795

Movement on Revaluation Reserve:

net gain on revaluation of assets (4,581) (232)

Total gains and losses recognised since 1 April 1998 90,583 97,563

The prior year adjustment (see Note 2) has no monetary effect on this Statement.

STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES

40

BASIS OF ACCOUNTING

The Accounts for the Office for National Statistics have been prepared in accordance with

the Accounts Direction issued by HM Treasury on 11 November 1997 pursuant to section

5(1) of the Exchequer and Audit Departments Act 1921 (see page 53).

The Accounts follow the accruals concept of accounting and the historical cost

convention, modified to include revaluation of fixed assets as set out below.

Subject only to compliance with the requirements set out in the Accounts Direction,

the Accounts also:

› comply with the accounting disclosure requirements of the Companies Acts insofar as

they are consistent with the status of a Vote-funded Agency;

› comply with the accounting standards issued or adopted by the Accounting Standards

Board unless they are deemed to be inapplicable by the Treasury.

FIXED ASSETS

Tangible fixed assets are capitalised above an agreed threshold at cost on acquisition and

installation, or at their estimated current cost. Bespoke software is valued in accordance

with FRS15. Assets are revalued each year to take account of specific changes on the basis

of appropriate Producer Price Indices for :

› Computers

› Office equipment

› Motor vehicles

› Office machinery

› Building refurbishment

Furniture and PCs below the capitalisation threshold are not capitalised.

DEPRECIATION

Depreciation is calculated so as to write-off the revalued cost or the valuation of assets by

equal instalments over their estimated useful lives down to a residual value, as follows:

› Mainframes 7 years

› Bespoke software 7 years

› Proprietary software 4 years

› PCs 4 years

› Large office equipment 10 years

› Small office equipment 4 years

› Motor vehicles 5 years

› Buildings and refurbishments Remaining life of lease

ASSETS UNDER CONSTRUCTION OR DEVELOPMENT

Capitalised projects in the course of construction or development are not depreciated

until the year in which they become fully operational.

STOCKS

ONS holds a small stock of publications and CD-ROMs for resale.Their value is not

material and is not included on the Balance Sheet. Production costs and sales income are

charged to the Net Expenditure Account.

LEASES

Assets held under finance leases are included under tangible fixed assets at their capital

value and depreciated over their useful economic lives. Leasing payments consist of capital

and interest elements and the interest is charged to the Net Expenditure Account. Rentals

N O T E S T O T H E AC C O U N T S

1. ACCOUNTING POLICIES



due under operating leases are charged over the lease term on a straight-line basis or on

the basis of actual rentals payable where this fairly reflects usage.

HISTORIC DATA

Statistical and registration data have built up over many years and are stored for reference

purposes.The cost of storing and maintaining this data has been charged to the Net

Expenditure Account as incurred.

INTEREST ON CAPITAL

The financing structure of ONS does not include specific interest bearing debt, but to

ensure that the Net Expenditure Account bears an appropriate charge for the use of

capital in the business in the year, a notional interest charge is included. In accordance with

Treasury guidance, the calculation is based on a 6% rate of return on average net assets

employed at current values.

NOTIONAL INSURANCE PROVISION

The previous practice of making a notional insurance charge has been discontinued in line

with HM Treasury instructions.

VAT

ONS is registered for VAT purposes.

VAT is reclaimed on certain bought-in services as agreed with HM Customs and Excise.

Irrecoverable VAT is included either in the expenditure in the Net Expenditure Account or

in the cost of tangible fixed assets in the Balance Sheet.

INCOME

Income comprises the invoiced value of services supplied to the private sector, the wider

public sector and other government departments.

FOREIGN CURRENCY

Foreign currency transactions are translated at the exchange rate in force at the time of

the transaction. Exchange rate gains and losses are charged to the Net Expenditure Account.

RESEARCH & DEVELOPMENT

ONS undertakes certain research into statistical and survey methodology. Costs are

charged to the Net Expenditure Account as they arise.

EARLY RETIREMENT

ONS operates an early retirement scheme which gives retirement benefits conforming

with the Principal Civil Service Pension Scheme. ONS bears the costs of these benefits

until the normal retirement age of the employees.

42

In preparation for Resource Accounting, ONS has taken the opportunity to review its

accounting policy with regard to disclosure of the surplus/deficit grant drawn down from

the Consolidated Fund. In previous years this was included in the General Reserve

balance.We now consider it more appropriate and transparent to include it in the

Creditors balance on the Balance Sheet and as a separate line on Note 12.

The effects of the prior year adjustment on the previously reported figures are shown

below:

1997–98

BALANCE SHEET £’000

Creditors (due within one year) previously reported 3,076

Unused grant drawn down 2,380

Creditors (due within one year) restated 5,456

GENERAL RESERVE

General Reserve balance at 31 March 1998 previously reported 26,758

Unused grant drawn down (2,380)

General Reserve balance at 31 March 1998 restated 24,378

2. PRIOR YEAR ADJUSTMENT



RUNNING COSTS INCLUDE:

1998–99 1997–98

£’000 £’000

Staff related costs 68,280 68,754

Accommodation and related services 13,856 19,570

Computer – current 7,170 5,939

Surveys and data collection costs 20,105 15,386

Other 10,536 13,167

119,947 122,816

1998–99 1997–98

£’000 £’000

› Remunerations (including the Director's), salaries and wages 56,256 54,892

Earnings related National Insurance contributions 4,067 3,946

Other related costs 615 2,803

60,938 61,641

› Superannuation 7,342 7,113

TOTAL STAFF RELATED COSTS 68,280 68,754

1998–99 1997–98

› Director's and Non-Executive Directors’ remunerations: £ £

The Director's total remunerations, excluding pension

contributions 99,881 97,533

The Director is a member of the Principal Civil Service

Pension Scheme

› Non-Executive Board Members (2) 4,732 12,145

3. RUNNING COSTS

4. STAFF DETAILS

A:

B:

44

› Senior employees

OTHER BOARD MEMBERS OTHER STAFF

Remunerations within the following ranges: 1998–99 1997–98 1998–99 1997–98

£30,000–£34,999 - - 91 70

£35,000–£39,999 - - 60 58

£40,000–£44,999 - - 36 31

£45,000–£49,999 - - 13 17

£50,000–£54,999 - - 9 8

£55,000–£59,999 1 - 6 7

£60,000–£64,999 - 2 2 -

£65,000–£69,999 3 1 - -

£70,000–£74,999 2 3 - -

£75,000–£79,999 - - - -

£80,000–£84,999 - - - 1

£85,000–£89,999 - - - -

£90,000–£94,999 - - 1 -

› Number of employees:The average number of full time equivalent employees in the

period 1 April to 31 March 1999 was 3,082.

› The staff related costs do not include the fees and expenses of the 817 fee-paid

interviewers employed on social surveys, which are included in the survey and data

collection costs.

› The employees of ONS are civil servants to whom the conditions of the

Superannuation Acts 1965, 1972 and subsequent amendments apply. For the period

ended 31 March 1999, contributions were paid to the Paymaster General at rates 12%

to 18% (according to grade) of salaries determined by the Government Actuary and

advised by HM Treasury.

C:

D:

E:

F:



The full cost of the early retirement departure decisions taken so far this year is estimated

to be £637,000 and is being met in total by ONS.This has been offset by a reduction of

£78,000, due to an over estimate of 1998–99 expenditure on previous years’ decisions.

FUTURE1998–99 YEARS

£’000 £’000

Cost met by ONS 559 3,622

Net notional charge* 408 0

Net Expenditure Account 967 0

*The notional charge relates to decisions made prior to 1 April 1997.

1998–99 1997–98

£’000 £’000

National Audit Office audit fee note 1 31 34

Notional insurance note 2 0 130

31 164

Notes:

1. The National Audit Office does not charge fees for the audit of On Vote Agencies.The notional audit fee however,

represents the full cost of services provided.

2. On HM Treasury instructions, notional insurance is no longer charged to the Net Expenditure Account.

5. EARLY RETIREMENT COSTS

6. OTHER NOTIONAL COSTS

AND SERVICES

46

1998–99 1997–98

£’000 £’000

Interest on fixed capital (see Note 15) 778 0

Interest on working capital 1,525 1,863

2,303 1,863

The interest on capital employed is calculated at 6%.

For the purposes of company law and accounting standards, ONS has only one class of

business, the vast majority of which arises in the UK.The following information is given to

satisfy the additional disclosure requirements of the HM Treasury Fees and Charges Guide,

in accordance with paragraph 3 of the Agency's Accounts Direction.

The only area of business where fee levels are regulated by statute is the supply of

Registration Certificates.The financial objective is to recover full economic costs taking one

year with another.The expenditure and income relating to Certificates was:

1998–99 1997–98

£’000 £’000

Income 5,191 4,806

Expenditure 4,585 4,786

Surplus in year 606 20

The balance of income, £25,343,000 (£24,599,000 in 1997–98), comes from services

supplied, such as social surveys and the National Health Service Central Register, and from

the sale of publications and data.

7. NOTIONAL INTEREST ON

CAPITAL EMPLOYED

8. INCOME



LAND AND COMPUTERS MOTOR OFFICE

BUILDINGS (1) VEHICLES MACHINERY TOTAL

£’000 £’000 £’000 £’000 £’000

Valuation at 1 April 1998 17,748 17,243 154 3,022 38,167

Additions (note 2) 18 2,565 41 431 3,055

Transfers from assets

under construction 626 280 0 0 906

Reclassifications (note 3) 13,560 626 (3) (169) 14,014

Disposals (note 4) 0 (982) (33) (223) (1,238)

Revaluation (note 5) 4,707 0 2 (21) 4,688

Valuation at 31 March 1999 36,659 19,732 161 3,040 59,592

Depreciation provision

at 1 April 1998 859 8,736 71 1,838 11,504

Charge in year 1,551 4,812 32 358 6,753

Reclassifications 143 (2,759) (8) (1,120) (3,744)

Disposals (note 4) 0 (843) (26) (157) (1,026)

Revaluation 109 0 1 (3) 107

Depreciation provision

at 31 March 1999 2,662 9,946 70 916 13,594

Net book value at current cost:

At 1 April 1998 16,889 8,507 83 1,184 26,663

At 31 March 1999 33,997 9,786 91 2,124 45,998

Notes:

1. Included within Computers are finance leases with a net value of £370,000 for which £146,000 was allocated as

depreciation for the period.

2. ONS entered into a hire purchase arrangement to acquire 3 servers.

3. The main reclassifications represent:

a) the bringing onto the Balance Sheet of land and buildings, and

b) in preparation for Resource Accounting in 1999–2000, the opportunity has been taken to review and rationalise the price

indices used for Modified Historic Cost Accounting, the cumulative backlog depreciation and the lives of certain assets.

4. Assets to the value of £1,238,000 were disposed of during 1998–99.These assets had a carrying value of

£212,000 for which £10,000 was received leaving £202,000 to be charged to the Net Expenditure Account.

5. The downward revaluation (£2,517,000) in computers has been included within the depreciation charge for the year,

as per FRS11.

9. TANGIBLE FIXED ASSETS

48

IN-HOUSE

SOFTWARE BUILDINGS

PROJECTS REFURBISHMENT TOTAL

£’000 £’000 £’000

Opening balance 507 0 507

In year expenditure 391 802 1,193

Reclassification (note) (12) 214 202

Transfers to fixed assets (280) (626) (906)

Closing balance 606 390 996

Note:The reclassification relates to:

a) the net effect of expenditure on a software project being expensed in the 1997–98 Account and the total

expenditure on another software project not reaching the capitalisation limit, and

b) refurbishment work expensed in the 1997–98 Account.

CAPITAL COMMITMENTS

The capital commitments at 31 March 1999 were:

£’000

Contracted for : 504

10. ASSETS UNDER CONSTRUCTION



1998–99 1997–98

£’000 £’000

Trade debtors (less provisions) 2,593 2,397

Staff 416 693

Other 0 260

Prepayments 1,710 1,358

Undrawn grant (note) 404 0

Total 5,123 4,708

Note:The undrawn grant is the surplus Vote held on ONS's behalf by the Consolidated Fund.

AMOUNTS FALLING DUE WITHIN ONE YEAR

1998–99 1997–98RESTATED

£’000 £’000

Trade creditors 202 0

Staff creditors 0 0

Other creditors 233 222

Accruals 1,471 1,466

Net obligations under finance leases/

hire purchase (Note 14) 220 321

Deferred income 27 355

Consolidated fund extra receipts 1,181 0

Unused grant drawn down (Note 2) 0 2,380

3,334 4,744

Provision for early retirement (Note 13) 788 712

Total 4,122 5,456

Note:The movement in creditors, net of capital creditors, is £1,233,000.

BALANCE AT CHARGED TRANSFERRED BALANCE AT

1 APRIL TO NET EXP. TO 31 MARCH

1998 ACCOUNT APPLIED CREDITORS 1999

£’000 £’000 £’000 £’000 £’000

Provision for early retirement 3,285 559 (222) (788) 2,834

3,285 559 (222) (788) 2,834

11. DEBTORS

12. CREDITORS

13. PROVISION FOR LIABILITIES

AND CHARGES

50

LAND AND

BUILDINGS OTHER

£’000 £’000

Operating leases which expire:

within one year 0 102

in the second to fifth years inclusive 0 0

over five years 3,315 0

3,315 102

Note: During 1998–99 ONS's expenditure on operating leases amounted to £6,768,000. Of this £6,666,000 was in

respect of rent on land and buildings, including a one-off severance payment for St Catherine’s House, and £102,000

was on other leases.

Finance lease obligations:

Payments due within:

one year 161

two to five years 0

more than five years 0

161

Hire purchase obligations:

Payments due within:

one year 59

two to five years 60

more than five years 0

119

Note: During 1998–99 ONS acquired 3 servers under a 0% hire purchase agreement.

14. LEASE OBLIGATIONS



Property Repayment Services (PRS) rents were abolished on 31 March 1998. On Treasury

instructions property values have therefore been included on the Balance Sheet, where

ONS is the sole or major occupier (Note 9). Notional interest on capital employed (Note

7) now includes a charge for these assets.

ONS land and buildings were valued at 30 June 1995 on an Open Market Value for

Existing Use basis.Valuations were carried out for Property Holdings by independent firms

of professional valuers, these being King Sturge for the Christchurch and Newport sites,

Jones Lang Wootton for Titchfield and Edmund Kirby for Southport. Revaluation indices,

supplied by HM Treasury, were applied to those valuations in order to calculate the 1 April

1998 values shown in Note 9. A professional Revaluation will take place in 2000.

ONS has two industrial tribunals and one industrial injury case outstanding. Judgement is

still pending so the amount of the liability is not known.

ONS has had various material transactions with other government departments and other

central government bodies. Most of these transactions have been with HM Treasury and the

Departments of Health, Environment,Transport and the Regions,Trade & Industry and

Education & Employment.

During the period reported on, none of the Board Members, members of the key

management staff or other related parties had undertaken any material transactions with ONS.

One senior manager is seconded to EUROSTAT, where he is spearheading their corporate

planning programme. He is not in a position to influence the awarding of contracts to ONS.

During the period 1 April 1998 to 30 June 1998 the Chief Executive, Dr Holt, was on unpaid

leave from Southampton University. Dr Holt resigned from the University on 1 July 1998.

15. PROPERTY

16. CONTINGENT LIABILITIES

17. RELATED PARTY TRANSACTIONS

52

1998–99 1997–98

£’000 £’000

General Reserve at 1 April 24,378 29,864

Downward revaluation of assets

charged to the Net Expenditure Account 1,255

Land and buildings brought on charge 12,826

Finance lease (1,100)

Net Voted expenditure 96,227 93,443

Non-cash items 2,742 1,091

Net expenditure (95,164) (97,795)

Prior year adjustment (Note 2) (2,380)

General Reserve at the end of the period 41,009 24,378

1998–99 1997–98

£’000 £’000

Revaluation Reserve at 1 April 233 1

Surplus on revaluation 4,581 232

Revaluation Reserve at the end of the period 4,814 233

18. GENERAL RESERVE

19. REVALUATION RESERVE



1. The Office for National Statistics (ONS) shall prepare Accounts for the financial year

ended 31 March 1998 and subsequent financial years comprising:

› a Foreword

› a Net Expenditure Account

› a Balance Sheet

› a Cash Flow Statement, and

› a Statement of Total Recognised Gains and Losses

including such Notes as may be necessary for the purposes referred to in the following

paragraphs.

2. The Accounts shall give a true and fair view of the income and expenditure, and cash

flows for the financial year and the state of affairs as at the end of the financial year.

3. Subject to this requirement, the Accounts shall be prepared in accordance with;

› generally accepted accounting practice in the United Kingdom (UK GAAP);

› the disclosure and accounting requirements contained in The Fees and Charges Guide (in

particular those relating to the need for segmental information for services or forms of

services provided) and in any other guidance which the Treasury may issue from time to

time in respect of Accounts which are required to give a true and fair view;

› the accounting and disclosure requirements of Government Accounting (in particular

Chapter 16) and the Treasury’s guidance paper Next Steps Agencies - Annual Reports and

Accounts (February 1993), as amended or augmented from time to time,

insofar as these are appropriate to the ONS and are in force for the financial year for

which the Accounts are to be prepared.

4. Clarification of the application of the accounting and disclosure requirements of the

Companies Act and accounting standards is given in Schedule 1 attached. Additional

disclosure requirements are set out in Schedule 2 attached.

5. The Net Expenditure Account and Balance Sheet shall be prepared under the historical

cost convention modified by the inclusion of:

› fixed assets at their value to the business by reference to current costs; and

› stocks at the lower of net current replacement cost (or historical cost if this is not

materially different) and net realisable value.

6. This Direction shall be reproduced as an appendix to the Accounts. It will not be

necessary to reproduce the Pro Forma Accounts.

J Mortimer

Treasury Officer of Accounts

11 November 1997

AC C O U N T S D I R E C T I O N

ACCOUNTS DIRECTION GIVEN BY

HM TREASURY IN ACCORDANCE

WITH SECTION 5(1) OF THE

EXCHEQUER AND AUDIT

DEPARTMENTS ACT 1921

54

COMPANIES ACT

1. The disclosure exemptions permitted by the Companies Act shall not apply to the ONS

unless specifically approved by the Treasury.

2. The Companies Act requires certain information to be disclosed in the Directors’

Report.To the extent that it is appropriate, the information relating to the ONS shall be

contained in the Foreword.

3. When preparing its Net Expenditure Account the ONS shall have regard to the

appended Pro Forma Account. Minor changes may be introduced subject to Treasury

agreement.

4. When preparing its Balance Sheet, the ONS shall have regard to the Balance Sheet

format 1 prescribed in Schedule 4 to the Companies Act.The Balance Sheet totals shall be

struck at ‘Total assets less current liabilities’.

5. The ONS is not required to provide the historical cost information described in

paragraph 33(3) of Schedule 4 of the Companies Act.

6. The Foreword and Balance Sheet shall be signed by the Accounting Officer and dated.

ACCOUNTING STANDARDS

7. The ONS is not required to include a note showing historical cost profits and losses as

described in FRS3.

S C H E D U L E 2

1. The Foreword shall, inter alia:

› state that the Accounts have been prepared in accordance with a direction given by

the Treasury in accordance with Section 5(1) of the Exchequer and Audit

Departments Act 1921; and

› include a brief history of the ONS and its statutory background.

2. The Notes to the Accounts shall include details of the key corporate financial targets set

by the responsible Minister together with an indication of the performance achieved.

S C H E D U L E 1

APPLICATION OF THE

ACCOUNTING AND DISCLOSURE

REQUIREMENTS OF THE

COMPANIES ACT AND

ACCOUNTING STANDARDS

ADDITIONAL DISCLOSURE

REQUIREMENTS



Under section 5(1) of the Exchequer and Audit Departments Act 1921 the Treasury have

directed the Office for National Statistics to prepare a Statement of Accounts for each

financial year in the form and on the basis set out in the Accounts Direction on page 53.

The Accounts are prepared on an accruals basis and must give a true and fair view of the

Agency’s state of affairs at the year end and its income and expenditure and cash flows for

the financial year.

In preparing Accounts, the Agency is required to:

› observe the Accounts Direction issued by the Treasury, including the relevant accounting

and disclosure requirements and apply suitable accounting policies on a consistent basis;

› make judgments and estimates on a reasonable basis;

› state whether applicable accounting standards have been followed, and disclose and

explain any material departures in the financial statements;

› prepare the financial statements on the going concern basis, unless it is inappropriate to

presume that the Agency will continue in operation.

The Accounting Officer of the Department of the Chancellor of the Exchequer has

designated the Director of the Office for National Statistics as the Accounting Officer for

the Agency. His relevant responsibilities as Accounting Officer, including responsibility for

the propriety and regularity of the public finances and for the keeping of proper records,

are set out in the Accounting Officers’ Memorandum issued by the Treasury and published

in Government Accounting.

S TAT E M E N T

STATEMENT OF THE AGENCY’S

AND DIRECTOR’S

RESPONSIBILITIES

56

1. As Accounting Officer, I acknowledge my responsibility for ensuring that an effective

system of internal financial control is maintained and operated by ONS.

2. The system can provide only reasonable and not absolute assurance that assets are

safeguarded, transactions authorised and properly recorded, and that material errors or

irregularities are either prevented or would be detected within a timely period.

3. It is based on a framework of regular management information, administrative

procedures including the segregation of duties, and a system of delegation and

accountability. In particular, it includes:

a) comprehensive budgeting systems with an annual budget which is reviewed and

agreed by the Management Board;

b) regular reviews by the Board of periodic and annual financial reports which indicate

financial performance against the forecasts;

c) the setting of targets to measure financial and other performance;

d) clearly defined capital investment control guidelines; and

e) as appropriate, formal project management disciplines.

4. ONS has an internal audit unit, which operates to standards defined in the Government

Internal Audit Manual.The work of the internal audit unit is informed by an analysis of

the risk to which the body is exposed, and annual internal audit plans are based on this

analysis.The analysis of risk and the internal audit plans are endorsed by the Audit

Committee and approved by me. At least annually, the Head of Internal Audit (HIA)

provides me with a report on internal audit activity in ONS.The report includes the

HIA's independent opinion on the adequacy and effectiveness of ONS’s system of

internal financial control.

5. During 1998–99 a major audit of budgetary control was carried out.This resulted in:

a) the formation of a Finance Committee to oversee the operation of financial control

arrangements;

b) the finalisation of a financial framework within which managers are to operate;

c) the establishment of a Financial Management Information Systems Development

Project Board, reporting to the Finance Committee.This has reviewed the chart of

accounts, time recording system and overhead methodology with the aim of improving

the quality and transparency of financial management information.The changes arising

from these reviews will be implemented from 1 April 1999;

d) formal delegation letters, supporting the budgetary control system, being issued to

managers as appropriate;

e) the roll out of an improved version of our CHESS executive financial management

information system.This gives managers quicker, clearer and direct access to information

about their budgets, expenditure and income; and

f) an enhanced role for the Audit Committee.

6. Of the other 35 audits carried out only one, relating to Sales Invoicing and Receipts,

resulted in a non-assurance report. Measures will be taken during 1999–2000 to

overcome the procedural shortcomings identified.

7. A further audit report, produced just after the year end, found some weaknesses in the

procurement and management of consultancy projects in various parts of the Office.

Particular criticisms were made in respect of one contract, leading to further audit

investigations in the business area concerned. Proposals have been developed to remedy

the control shortcomings found in that area, and also to strengthen the guidance

available to the Office generally on engaging and managing consultants.

S TAT E M E N T

STATEMENT OF THE SYSTEM OF

INTERNAL FINANCIAL CONTROL



8. My review of the effectiveness of the system of internal financial control is informed by

the work of the internal audit unit, the Audit Committee which oversees the work of

the unit, the executive managers within ONS who have responsibility for the

development and maintenance of the financial control framework, and comments made

by the external auditors in their management letter and other reports.

9. During 1998–99 a programme of action was undertaken to improve the quality and

timeliness of the annual agency account.This included the institution of formal

management reviews and an enhanced role for the Audit Committee.

Accounting Officer


I certify that I have audited the financial statements on pages 35 to 52 under the

Exchequer and Audit Departments Act 1921.These financial statements have been

prepared under the historical cost convention as modified by the revaluation of fixed

assets and the accounting policies set out on pages 40 and 41.

RESPECTIVE RESPONSIBILITIES OF THE AGENCY, DIRECTOR AND AUDITOR

As described on page 55, the Agency and Director are responsible for the preparation of

the financial statements and for ensuring the regularity of financial transactions.The Agency

and Director are also responsible for the preparation of the other contents of the Annual

Report. My responsibilities, as independent auditor, are established by statute and guided

by the Auditing Practices Board and the auditing profession’s ethical guidance.

I report my opinion as to whether the financial statements give a true and fair view and

are properly prepared in accordance with the Exchequer and Audit Departments Act

1921 and Treasury directions made thereunder, and whether in all material respects the

expenditure and income have been applied to the purposes intended by Parliament and

the financial transactions conform to the authorities which govern them. I also report if, in

my opinion, the Foreword is not consistent with the financial statements, if the Agency has

not kept proper accounting records, or if I have not received all the information and

explanations I require for my audit.

I read the other information contained in the Annual Report, and consider whether it is

consistent with the audited financial statements. I consider the implications for my

certificate if I become aware of any apparent misstatements or material inconsistencies

with the financial statements.

I review whether the statement on pages 56 and 57 reflects the Agency’s compliance

with Treasury’s guidance ‘Corporate governance: statement on the system of internal

financial control’. I report if it does not meet the requirements specified by the Treasury, or

if the statement is misleading or inconsistent with other information I am aware of from

my audit of the financial statements.

BASIS OF OPINION

I conducted my audit in accordance with Auditing Standards issued by the Auditing

Practices Board. An audit includes examination, on a test basis, of evidence relevant to the

amounts, disclosures and regularity of financial transactions included in the financial

statements. It also includes an assessment of the significant estimates and judgments made

by the Agency and Director in the preparation of the financial statements, and of whether

the accounting policies are appropriate to the Agency’s circumstances, consistently applied

and adequately disclosed.

I planned and performed my audit so as to obtain all the information and explanations

which I considered necessary in order to provide me with sufficient evidence to give

reasonable assurance that the financial statements are free from material misstatement,

whether caused by error, or by fraud or other irregularity and that, in all material respects,

the expenditure and income have been applied to the purposes intended by Parliament

and the financial transactions conform to the authorities which govern them. In forming

my opinion I have also evaluated the overall adequacy of the presentation of information

in the financial statements.

OPINION

In my opinion:

› the financial statements give a true and fair view of the state of affairs of the Office for

National Statistics at 31 March 1999 and of its net cost of output, total recognised gains

C E RT I F I CAT E A N D R E P O RT O F T H E C O M P T RO L L E RAND AUDITOR GENERAL TO THE HOUSE OF COMMONS


and losses, and its cash flows for the year then ended and have been properly prepared in

accordance with the Exchequer and Audit Departments Act 1921 and the directions

made thereunder by the Treasury: and

› in all material respects the expenditure and income have been applied to the purposes

intended by Parliament and the financial transactions conform to the authorities which

govern them.

I have no observations to make on these financial statements.

John Bourn

Comptroller and Auditor General

National Audit Office

157–197 Buckingham Palace Road

Victoria

London SW1W 9SP

23 July 1999

60

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