§ Mr. Ralph Howellasked the Prime Minister what improvements were made to the national accounts estimates of the various components of the hidden economy prior to the publication of the 1980 National Income and Expenditure Blue Book; and what resources are at present devoted by the Central Statistical Office and the Inland Revenue to making further improvements.
§ The Prime MinisterThe assessment of the minimum size of the hidden economy, described in the February 1980 issue ofEconomic Trends, was based on differences between totals of reported income and reported expenditure. In compiling the 1980 National Income and Expenditure Blue Book, the assessment was revised in the light of later information on income and expenditure. The allowance currently made for the hidden economy in the income measure of gross domestic product is of the order of 2½ per cent.
9WIt is part of the continuing work of the Central Statistical Office to monitor and improve the quality and coverage of national income and expenditure statistics; but no further resources have been allocated specifically to measuring the hidden economy. Nor does the Inland Revenue deploy resources specifically to this end, although to the extent that additional information about the hidden economy becomes available from their enforcement and investigation work it will be reflected in the incomes data supplied to the CSO.