RESTRICTED – CSR07

2007 Comprehensive Spending Review

ONS long-term strategy

1.Since ONS was formed in 1996 it has been the main provider of official statistics in the UK.ONS designs and carries out the majority of statistical surveys of the UK government, maintains the trust of survey respondents in official statistical surveys, publishes statistics on one of the UK government's most active web services (over 500,000 users a months), and produces some 600 reports annually on economic progress, demographic, health and social conditions of the UK.

2.A significant factor in ONS’s future strategy is the impact of the new independent Governing Board.

3.ONS’s goal is to ensure availability of and accessibility tosound, relevant statistics to enable timely and effective decision-making by government, communities and business. This gives the UK a competitive advantage in economic performance, political and social stability and cultural development. To support this, ONS’s policy is to charge users only where they have a specific need for an output which is not required by other users.

4.ONS statistics provide the evidence to underpin policy decisions and to measure the efficacy of those policies. The document Long-term opportunities and challenges for the UK: analysis for the 2007 Comprehensive Spending Review uses the wide range of ONS data to measure progress since the 1997 Comprehensive Spending Review and to analyse the context for the CSR07 period.

5.ONS’s strategy has three main objectives:

  • to identify and provide the official statistics that meet the UK needs
  • to meet the UK’s international (mainly European) statistical commitments
  • to modernise and keep refreshed the infrastructure that supports the provision of those statistics.

6.ONS statistics have a wide range of users, which presents the department will an incredible level of demands and a significant management challenge. To meet this ONS has established a comprehensive user liaison strategy, which uses existing and bespoke communication channels, formal and informal.

7.ONS has formal relationships with the majornational users of its statistics: the Bank of England, HM Treasury,the Department for Trade and Industry, the National Assembly for Wales, the Scottish Executive, the Northern Ireland Statistical Research Agency (NISRA) and the Department for Work and Pensions – its “key accounts”. There are plans to extend these to include the Department of Health (a replacement agreement following the reorganisation of DH), the Economic Statistics and Research Council, the Department for Communities and Local Governmentand the Home Office.

8.ONS also works closely with Eurostat (the Statistical Office of the European Commission), and other international agencies such as the OECD. The relationship with Eurostat is particularly important because EU Regulations have the potential to increase ONS’ costs, as well as costs on survey respondents.

9.All relationships are managed consistently and according to the National Statistics Framework Document, Code of Practice and its supporting protocols. ONS meet with senior representatives of each key account at least every six months to discuss not only ONS’s performance in delivering the current statistical outputs but also new or impending requirements.

10.There are also semi-formal relationships with a wide range of bodies, including local government, other national statistical institutes and academics, and ONS consults widely on a variety of topics and issues, for example, the Census of Population. Together with strategic reviews, such as that of regional and economic statistics (the Allsopp Review) and that of measurement of the public sector (the Atkinson Review), and other mechanisms for engaging users, these inform the agenda for ONS’s statistical programme.

11.ONS is also at the heart of the Government Statistical Service (GSS) and plays an active co-ordinating role in relation to standards and guidance, recruitment and training, and the provision of specialist advice. This role will tend to assume greater importance post-Independence.

12.The economic statistics programme is based on the development of measures of the real economy, price indexes, of industrial sectors, including services, and of the UK's interaction with the increasingly globalised world economy. The programme supports the policy goals of price stability, longer term fiscal sustainability and international competitiveness. It also supports labour and employment integration and productivity, the enlargement of the EU and monetary union.

13.On the social and demographic front, ONS presents a regularly updated picture of the social and economic characteristics of the UK population and the households and families it comprises. It produces population estimates and projections and detailed statistics of births and deaths. Neighbourhood Statistics uses much of this together with statistics from across the GSS to provide community based statistics on the web.

14.A zero based approach to the portfolio of surveys built up over 50+ years has led to a programme of integrating surveys. This will bring major statistical benefits and some savings. Greater use of administrative statistics and data sharing will lead to further improvements.

15.There is an on-going and pressing demand for ONS to produce more. The regional, structural and population agendas are good examples. In addition, the department is under pressure to take over statistical work from other departments such as the Cabinet Office, GAD and DTI. Some of the transfers have already taken place. As such the growth is welcome and a good strategic fit. As the UK's National Statistical Institute (NSI), there is a clear imperative for ONS to be the lead producer meeting the key statistical requirements of Government. While ONS currently produces all major statistics to support National Accounts and many major household survey outputs, there is a compelling case that ONS should be the producer of all major benchmark surveys in the UK. Not just those on the labour market and the economy, but also, for example, those on housing and health.

16.The foundations for ONS’s long-term modernisation programme were set out in the ONS business strategy of 2000. ONS's infrastructure was outmoded and fragmented and it iscommitted to delivering large-scale modernisation within in a shorter time than it took to develop the original systems.

17.The agreed programme for 2006-07 and 2007-08 concentrates on largely tactical projects that reduce risk and maintain business continuity. ONS will deliver the benefits, which comprise both cash-releasing and quality improving, as rapidly as possible, while continuing to produce, and limit the risks associated with, its key outputs. The next key phase of the modernisation programme also goes beyond the integration of processes and systems to cover the integration of data. It also expands the approach behind the Integrated Household Survey to business surveys.

18.In summary, the significant investment provided by the 2002 Spending Review,along with a continuing line of investment since the 2004 Spending Review is being used to provide new and better quality statistical outputs and to transform policies, processes, methods and practices. Achievements to date include:

  • the establishment of the UK Centre for the Measurement of Government Activity and the ONS Centre for Demography
  • greater web-based delivery of statistics and registration services
  • the development of Neighbourhood Statistics (NeSS) and census-based delivery of area statistics
  • the establishment of regular outputs on pensions and public sector employment
  • the development of analysis and reporting plans based around a strategic view of key topics of interest to the public and policy makers
  • the development, publication and implementation of the National Statistics Code of Practice and accompanying protocols
  • the development and implementation of the Enterprise Resource Planning System (AtlasHR and Atlas Financials)
  • the development of strategic IT platforms such as Oracle, Java and Tridion content management, and installation of operating systems, a storage area network and servers
  • the implementation of new systems to process and publish new statistics on civil partnerships and for processing birth notifications directly from the Registration system.
  • the installation of new technology to improve the efficiency of data collection for businesses

19.To support these deliverables ONS has:

  • reorganised the statistical directorates to enable it to exploit the synergies or economies of scale across data collection; efficiencies here will result in savings totalling £7m (or 17%) by 2007-08
  • strengthened and focussed statistical methodology, bringing methodology professionals together in a Methodology Directorate
  • invested in and developed the skills of staff
  • worked with key strategic partnersfor development services, for servers, for website hosting and for server space at an off-site data centre.

20.Internationally statistical offices are facing up to rapidly developing information and communication technologies, population changes, and globalisation. Some of the long-held assumptions about statistical measurement and official statistics are being challenged by the changing nature of society and economy. This is especially true for the UK where the scale, diversity and dynamism of the economic base, demography and culture are considerable.

21.The high-level priorities for ONS over the next five years are:

  • delivering key, current and new statistics to the published schedule
  • managing statistical risk and recovery
  • delivering the benefits of the modernisation programmeto enable more focus on the integration of systems, releasing resources to be invested in improved statistical reporting, analysis and dissemination
  • delivering the benefits of a quality management programme to provide users with accessible information about the quality and usability of outputs
  • through access to administrative records, adding to the portfolio of statistical activities, where this supports the overall strategy
  • continuing to work with other NSIs (and across Government) in encouraging the European Commission to simplify legislation and re-balance priorities, in order to reduce the compliance burden imposed on business
  • revitalising the GSS, in response to the challenge set by HMT in the consultation document ‘Independence for Statistics’.

22.The challenges and opportunities analysed in Long-term opportunities and challenges for the UK: analysis for the 2007 Comprehensive Spending Review are key drivers for ONS’s long-term strategy. ONS data contribute significantly to meeting the challenges set out in that publication, for example:

  • population and life events statistics, diversity statistics, survey data on families and household composition, intentions, preferences, attitudes, etc to measure Demographic and socio-economic change
  • responding to the policy agenda on Globalisation, by improving both underlying statistical sources and the analysis based on them in order to understand, e.g. the changing patterns of trade and investment, the impact of international specialisation on labour force, inputs to innovation and outputs, and the contribution of skills to productivity growth
  • measuringthe impact on society, UK businesses response/use of technology, household use, impact on health to track the impact of Technological change
  • measures of poverty, population growth, debt relief (remittances)are important to the assessments of Global uncertainty
  • trends in public health are an indicator of the impact of Pressure on natural resources and global climate

Annex – Zero-based reviews

1.The original scope of the review of the IM function, which was carried out against a background of increasing demand constrained by the need to reduce headcount and costs. It focussed on the potential benefits of a number of options for outsourcing differing proportions of the function. In all cases the costs following these reforms were greater than the counterfactual baseline. ONS has adjusted the scope of the review for the CSR period to develop options built around industry-standard techniques for cost containment. In the longer term, in particular as Project Isaac progresses, the benefits of outsourcing the function, or parts of it, may emerge.

2.ONS’s position on the shared service agenda is:

  • to continue to establish viability of outsourcing elements of IT via progression of project ISAAC
  • that the outsourcing of HR & Finance would not be taken forward at this time but reviewed in 2009 for HR and 2010 Finance. At that time ONS would look towards buying internally, i.e. from another government department
  • that for the outsourcing of data collection the immediate focus would be on cost efficiency and investigating potential outsourcing of support services such as recruitment of interviewers. However, ONS does not intend to pursue outsourcing small/non-core business surveys over the CSR07 period.

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ONS March 2007