§ Lord KENNET
asked Her Majesty's Government:
What is the estimated margin of error in the calculations used to arrive at the gross domestic product, particularly in the light of (a) the exclusion from records of (i) some 7½ per cent. of earnings (according to the chairman of the Board of Inland Revenue), and (ii) unmarketed (but marketable) activities performed in the domestic and other context, and (b) of the use of their wages and salaries to represent the " Product " of certain categories of workers.
§ The MINISTER of STATE, TREASURY (Lord Cockfield)
The assessment of the Central Statistical Office, as published inNational accounts statistics: sources and methods in 1968, is that estimates of gross domestic product are subject to a margin of error of less than £3 per cent. There is no evidence for supposing that the margins of error have changed substantially since 1968. The statement by the chairman of the Board of Inland Revenue to the Expenditure Committee (General Sub-Committee) on 26th March about incomes unrecorded by the Inland Revenue has no direct relevance to the national accounts estimates which incorporate some allowance for tax evasion in the income-based estimates of gross domestic product.
The United Kingdom, in common with other industrialised countries, excludes non-marketed household production from the boundaries of production as defined for national accounts purposes. Since wages and salaries form an integral part of the value-added or net output of each industry they are properly included in the income-based estimates of gross domestic product at current prices.