Exclusive-UK to appoint senior official to tackle problems at statistics office - source

By Elizabeth Piper

LONDON (Reuters) -Britain is set to split the top job at the country's statistics office to create a second role focused on overseeing the running of the organisation, which has been criticised for economic data failures, a person familiar with the situation said.

The Office for National Statistics (ONS), Britain's largest independent producer of official statistics, has been criticised by the Bank of England after its labour, inflation, trade and producer price data all suffered from errors or methodology problems.

Its employment data problems, stemming from a slump in responses to its surveys, have caused headaches at the BoE, which needs to know how much inflation pressure is lingering in the jobs market when it sets interest rates.

The person, who spoke on condition of anonymity, said a government-commissioned review would recommend the top ONS role of national statistician be temporarily split, bringing in a senior civil servant responsible for improving the running of the service.

The government was expected to accept the recommendation, giving it greater control. The review is expected to be published imminently, the source said.

Concerns around ONS data first emerged in 2023 when it said it had detected problems with the response rates to its Labour Force Survey (LFS). An improved version of that survey might only be released in 2026 or possibly even 2027.

BoE Governor Andrew Bailey said the shortcomings of the data, used to calculate Britain's unemployment rate, was a "substantial problem" for policymakers.

In May, head statistician Ian Diamond resigned and the UK Statistics Authority, which is responsible for oversight of the ONS, said Emma Rourke, deputy national statistician for health, population and methods, would step in until a longer-term arrangement was put in place.

Economists such as Jonathan Portes at King's College London have attributed the ONS problems to years of tight budgets, low pay for its statisticians compared with private sector peers and a reluctance by households to respond to surveys - an issue that got worse during the COVID-19 pandemic.

The ONS has reduced some operations to focus on core economic and population figures in the face of tight funding. It has also hired a Bank of England official to lead a drive to improve its data.

(Reporting by Elizabeth Piper; writing by Kate Holton)