§ Mr. FlightTo ask the Chancellor of the Exchequer if he will list(a) the Government consumption expenditure deflator and (b) the level of public sector inflation for each year since 1997. [174980]
§ Ruth KellyThe information requested falls within the responsibility of the National Statistician, who has been asked to reply.
1459WLetter from Len Cook to Mr. Howard Flight, dated 24 May 2004.
As National Statistician I have been asked to reply to your recent question concerning (a) the Government consumption expenditure deflator and (b) the level of public sector inflation for each year since 1997. (174980)
The implied annual deflator for general government consumption derived from the national accounts estimates published in March 2004 is presented in the attached table.
Please note that these estimates do not present price measures directly, since with a few exceptions (e g. passport fees), there are no directly observable prices for the services provided by government. The estimates are therefore derived by comparing the spending on producing government services with measures of the output of those services. As derived statistics, they should not be confused with measures of the price of the inputs such as public sector earnings or prices paid for other purchases.
In calculating the deflator, the quality and reliability of the output measures are crucial. However, public service delivery and management mechanisms have developed and become more complex in recent years, and there is an increasing emphasis on the quality of service for the customer. As a result there are greater demands on, and expectations of, measures of government output. In order to ensure that output measures can respond to these demands, in December 2003 I announced an independent review, led by Sir Tony Atkinson, of the future development of government output and productivity measures, and the associated price indices.
General Government consumption—implied deflator1 UK, 1997–2003
Year Index 1997 88.8 1998 91.1 1999 95.4 2000 100.0 2001 105.7 2002 113.3 2003 122.7 1Indexed, with value of 100 in year 2000 Source: UK National Accounts, 26 March 2004