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Statistical bulletin: Quarterly National Accounts, Q2 2012 This product is designated as National Statistics

Released: 27 September 2012 Download PDF

Headline figures

  • UK gross domestic product (GDP) in volume terms decreased by 0.4 per cent between the first and second quarter of 2012, revised from a previously estimated decline of 0.5 per cent.
  • Output of the production industries fell by 0.7 per cent, revised up from the previously estimated decline of 0.9 per cent.
  • Manufacturing output fell by 0.8 per cent in the second quarter of 2012, revised up from the previously estimated decline of 0.9 per cent.
  • Output of the service industries fell by 0.1 per cent, unrevised from the previously published estimate.
  • Output of the construction industry fell by 3.0 per cent, revised up from the previously estimated 3.9 per cent fall.
  • Household final consumption expenditure decreased by 0.2 per cent in volume terms in the latest quarter, revised up from a previously estimated decline of 0.4 per cent.
  • In current price terms, compensation of employees rose by 0.2 per cent in the second quarter of 2012, revised down from a previously estimated increase of 1.2 per cent.

Summary

This bulletin contains information on the third estimate of GDP for 2012 quarter two. It includes information along with revisions to and more detail on the output, income and expenditure approaches to GDP. Also included are data on the institutional sector accounts, including the household saving ratio and disposable income.

Key data

Q2 2012

 
  Household saving ratio                           Real household disposable income                        Gross domestic product
Current market prices                      Chained volume measure                         Chained volume measure                         
  per cent 1per cent 2009=100 2009=100 1per cent
Seasonally 
adjusted
           
2010 Q2 5.9 -0.3 104.2 101.8  0.7
2010 Q3 7.2  0.9 105.3 102.4  0.6
2010 Q4 6.2 -0.8 105.9 102.0 -0.4
2011 Q1 5.1 -1.8 107.6 102.5  0.5
2011 Q2 6.3  0.6 108.0 102.5 0.1
2011 Q3 6.6  0.8 108.6 103.1  0.5
2011 Q4 6.0 -1.3 109.2 102.7 -0.4
2012 Q1 6.0 0.3 109.2 102.4 -0.3
2012 Q2 6.7 1.9 110.4 102.0 -0.4

Table source: Office for National Statistics

Table notes:

  1. Percentage change on previous quarter

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Output Indices, CVM SA

Presents output indices CVM SA
Source: Office for National Statistics

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GDP analysed by output categories, chained volume measures, tables B1 and B2

  • Annex A (29 Kb Excel sheet) contains growth rates back to 2011 Q1.

  • Output of the agriculture, forestry & fishing industries decreased by 2.6 per cent in the second quarter of 2012 following a decrease of 2.3 per cent in the first quarter of 2012.

  • Output of the production industries fell by 0.7 per cent in the second quarter of 2012. In the first quarter of 2012 output of the production industries fell by 0.2 per cent.

  • Mining & quarrying output decreased by 3.3 per cent in the second quarter of 2012. This follows a decrease of 3.0 per cent in the previous quarter.

  • Manufacturing output fell by 0.8 per cent in the second quarter of 2012. In 2012 quarter one manufacturing output was unchanged.

Manufacturing Growth, Quarter-on-Quarter, CVM SA

Presents manufacturing growth, CVM SA
Source: Office for National Statistics

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  • Electricity, gas, steam & air conditioning supply increased by 5.1 per cent in 2012 quarter two following an increase of 1.2 per cent in 2012 quarter one.

  • Water supply, sewerage & waste management decreased by 3.2 per cent in the second quarter of 2012 compared with an increase of 1.1 per cent in the first quarter of 2012.

  • Gross value added excluding oil and gas extraction decreased by 0.3 per cent in the second quarter of 2012 following a decrease of 0.2 per cent in the first quarter of 2012.

  • Construction output decreased by 3.0 per cent in 2012 quarter two. This follows a decrease of 5.9 per cent in 2012 quarter one.

  • Services output decreased by 0.1 per cent in the second quarter of 2012 following an increase of 0.2 per cent in the first quarter of 2012.

Services Growth, Quarter-on-Quarter, CVM SA

Presents services, quarter on quarter, CVM SA
Source: Office for National Statistics

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  • Output of the distribution, hotels & restaurants industries was unchanged in 2012 quarter two, following an increase of 0.1 per cent in 2012 quarter one. Increases in food & beverage services and wholesale, retail & repair of motor vehicles were offset by decreases in wholesale trade except of motor vehicles and retail trade except of motor vehicles.

  • Output of the transport, storage & communication industries fell by 1.3 per cent in 2012 quarter two following an increase of 0.9 per cent in 2012 quarter one. The decrease was mainly due to computer programming and water transport.

  • Output of the business services & finance industries was unchanged in both 2012 quarters two and one. In 2012 quarter two decreases were mainly due to activities of head offices and management consultancy activities. These were offset by increases in rental & leasing activities and accountancy, book-keeping & auditing activites.

  • Output of government & other services increased by 0.3 per cent in 2012 quarter two following an increase of 0.3 per cent in 2012 quarter one. The 0.3 per cent increase in 2012 quarter two was due to human health activities.

GDP analysed by expenditure categories, chained volume measures, tables C2 and E3

  • Annex B (23.5 Kb Excel sheet) contains growth rates back to 2011 Q1.

  • Gross domestic expenditure (the sum of all expenditure by UK residents on goods and services which are not used up or transformed in a productive process) increased by 0.4 per cent in the second quarter of 2012 following an increase of 0.2 per cent in 2012 quarter one.

  • Household final consumption expenditure decreased by 0.2 per cent in 2012 quarter two, following an increase of 0.3 per cent in 2012 quarter one. The level of household expenditure is now 0.2 per cent higher than in 2011 quarter two. The largest decreases in household spending in the latest quarter were in restaurants & hotels, alcohol & tobacco and food & non alcohol drink. The largest increase was in transport.

Household Final Consumption Expenditure Growth, Quarter-on-Quarter, CVM SA

Presents household consumption expenditure
Source: Office for National Statistics

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  • Government final consumption expenditure decreased by 1.6 per cent in 2012 quarter two, following an increase of 3.1 per cent in 2012 quarter one.

  • Gross fixed capital formation decreased by 2.7 per cent in the latest quarter, following an increase of 3.2 per cent in the previous quarter.

Gross Fixed Capital Formation Growth, Quarter-on-Quarter, CVM SA

Presents gross fixed capital formation growth, quarter on quarter, CVM SA
Source: Office for National Statistics

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  • Including the alignment adjustment, the level of inventories increased by £0.9 billion in the latest quarter.

  • The deficit in net trade was £6.9 billion in 2012 quarter two, compared with a deficit in net trade of £4.1 billion in 2012 quarter one.

  • Exports of goods fell by 2.4 per cent in 2012 quarter two mainly due to a decrease in manufactured goods exports; specifically chemicals. Exports of services rose by 1.0 per cent in 2012 quarter two due mainly to increases in insurance services. Imports of goods rose by 1.1 per cent in 2012 quarter two due mainly to increases in mechanical machinery and material manufactures. Imports of services rose by 2.3 per cent in 2012 quarter two due to increases in other business services and travel services.

Net Trade, £ billion, CVM SA

Presents net trade
Source: Office for National Statistics

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GDP implied deflator

  • Annex D (27.5 Kb Excel sheet) contains growth rates back to 2011 Q1.

  • The gross domestic product implied deflator at market prices for 2012 quarter two is 2.7 per cent above the same quarter of 2011. The GDP implied deflator is calculated by dividing current price GDP by chained volume GDP and multiplying by one hundred to convert to an index. Is is not used in the calculation of GDP rather it is generated after the calculation of GDP.

GDP at Market Prices Implied Deflator, Quarter-on-same-Quarter of Previous Year

Presents market prices implied deflator, quarter on same quarter of previous year
Source: Office for National Statistics

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GDP analysed by income categories at current prices, table D

  • Annex C (28 Kb Excel sheet) contains growth rates back to 2011 Q1.

  • GDP at current market prices rose by 1.0 per cent in 2012 quarter two. In 2012 quarter one GDP at current market prices was unchanged.

  • Compensation of employees increased by 0.2 per cent in 2012 quarter two. This follows an increase of 1.3 per cent in 2012 quarter one when there was an exceptionally high level of employers' pension contributions.

Compensation of Employees growth, Quarter-on-Quarter, CP SA

Presents compensation of employees growth, quarter on quarter, CP SA
Source: Office for National Statistics

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  • The gross operating surplus of corporations, including the alignment adjustment, increased by 5.1 per cent in 2012 quarter two, following a decrease of 4.4 per cent in 2012 quarter one.

  • Private non-financial corporations' operating surplus, including the alignment adjustment, rose by 5.6 per cent in 2012 quarter two. Financial corporations' operating surplus rose by 7.3 per cent in 2012 quarter two.

Gross Operating Surplus of Corporations Growth, Quarter-on-Quarter, CP SA

Presents gross operating surplus of corporations growth, quarter on quarter, CP SA
Source: Office for National Statistics

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  • Taxes on products and production less subsidies decreased by 0.7 per cent in 2012 quarter two following a decrease of 0.6 per cent in 2012 quarter one.

Sector accounts, tables I, J1, J2, J3, K1 and K2

Summary

The household saving ratio was 6.7 per cent in 2012 quarter two following 6.0 per cent in the previous quarter. For the year 2011 the saving ratio was 6.0 per cent down from 6.6 per cent in 2010.

Net lending by sector, table I

In 2012 quarter two the central government, local government, public corporations and the financial corporations' sectors were net borrowers. Private non-financial corporations, households and the rest of the world sectors were net lenders.

Annually for 2011, the central government and local government sectors were net borrowers. Public corporations, financial corporations, private non-financial corporations, households and the rest of the world sectors were net lenders.

Central government

Net borrowing was £6.2 billion in 2012 quarter two following net borrowing of £25.6 billion in the previous quarter. This fall in borrowing reflects the £28 billion received by government of the Royal Mail pension plan assets in April, as previously published in the August 2012 Public Sector Finances Statistical Bulletin. For the year 2011 central government net borrowing was £122.4 billion following net borrowing of £146.0 billion in 2010.

Local government

Net borrowing was £2.0 billion in 2012 quarter two following net borrowing of £8.3 billion in the previous quarter. For the year 2011, local government net borrowing was £2.6 billion following net borrowing of £1.0 billion in 2010.

Public corporations

Net borrowing was £0.1 billion in 2012 quarter two, following net borrowing of £0.4 billion in the previous quarter. For the year 2011, public corporations' net lending was £0.2 billion following net lending of £1.0 billion in 2010.

Financial corporations

Net borrowing was £23.0 billion in 2012 quarter two following net lending of £6.2 billion in the previous quarter. For the year 2011, financial corporations' net lending was £29.9 billion following net lending of £31.0 billion in 2010.

Private non-financial corporations

Net lending was £9.0 billion in 2012 quarter two, following net lending of £12.5 billion in the previous quarter. For the year 2011, private non-financial corporations' net lending was £65.0 billion following net lending of £64.0 billion in 2010.

The household and non-profit institutions serving households

Net lending was £4.0 billion in 2012 quarter two following net lending of £2.6 billion in the previous quarter. For the year 2011, household and non-profit institutions serving households' net lending was £8.6 billion following net lending of £17.4 billion in 2010.

Rest of the world

Net lending was £19.9 billion in 2012 quarter two, following net lending of £14.5 billion in the previous quarter. For the year 2011, net lending was £25.6 billion following £33.6 billion in 2010. This implies a UK current account deficit for 2011.

Net Lending by Sector £billion, CP SA

Presents net lending by sector CP SA
Source: Office for National Statistics

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The household and non-profit institutions serving households (NPISH) sector, tables J1, J2 and J3

The saving ratio in 2012 quarter two was 6.7 per cent following 6.0 per cent in 2012 quarter one. This increase was driven by an increase in wages and salaries and net social benefits other than transfers in kind, partially offset by increased consumption expenditure.

Household Saving Ratio, CP SA

Presents household saving ratio, CP SA,

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The level of real household disposable income increased by 1.9 per cent in the latest quarter following an increase of 0.3 per cent in 2012 quarter one. The increase in the latest quarter is due to a 3.0 per cent increase in nominal gross disposable income offset by a rise of 1.0 per cent in the household and NPISH final consumption expenditure deflator.

Real Household Disposable Income, Quarter-on-Quarter, CVM SA

Presents Real household disposable income, quarter on quarter, CVM SA,
Source: Office for National Statistics

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For the year 2011, real household disposable income decreased by 1.5 per cent following a 0.5 per cent increase in 2010. This reflects a rise of 4.7 per cent in the household and NPISH final consumption deflator partially offset by a 3.1 per cent increase in nominal gross disposable income. The rise in nominal gross disposable income was driven by increased compensation of employees and gross operating surplus and mixed income partially offset by increased taxes on income and wealth.

Private non-financial corporations sector, tables K1 and K2

Net lending of private non-financial corporations was £9.0 billion in the latest quarter, following net lending of £12.5 billion in the previous quarter. This decrease in net lending in the latest quarter was driven by a rise in inventories.

For the year 2011 net lending was £65.0 billion following net lending of £64.0 billion in 2010. 

Economic background

GDP fell by 0.4 per cent according to the third estimate for the second quarter of 2012. Since the preliminary estimate, GDP for the second quarter has been revised up by 0.3 percentage points from a fall of 0.7 per cent. This is due to survey data and administrative sources which became available later in the quarterly round. Despite this upward revision, the broad economic picture remains unchanged.

On the output approach, since the preliminary estimate, output of the construction industry has been revised up by 2.2 percentage points to a fall of 3.0 per cent on the previous quarter. Whilst mining & quarrying including oil & gas extraction saw a similar upward revision from a preliminary estimate of a 5.9 per cent fall to a 3.3 per cent fall. Despite these areas of improvement; the construction, production and service industries all contracted during the second quarter.

These data indicate that corporations are still suffering from subdued demand domestically due to the fragile position of households and subdued consumer confidence and internationally due to the continuing turmoil in the Euro Area, our main trading partner.

Household final consumption expenditure remained weak, still recording a fall of 0.2 per cent despite a small upward revision from the previous estimate. These figures match external confidence surveys, some of which indicate a prolonged period of economic pessimism from households.

In summary, the picture is broadly the same as in the previous estimate; low demand due to the fragile position of households, low wages growth and subdued consumer confidence. However, there was a late surge in retail spending, with the retail sales index for June being revised up by 1.1 percentage points in July’s release. Subsequent quarters will be able to confirm whether this is the start of an improvement in the position of households.

ONS publishes a monthly Economic Review discussing the economic background giving economic commentary on the latest GDP estimate and other ONS economic releases.

Changes to Bank Holidays in May and June 2012

As part of the celebrations for the Queen's Diamond Jubilee there were changes to bank holidays in May and June 2012. The Spring Bank Holiday moved into June, and there was an additional day's holiday.

The change to the holidays has been classified as a statistical special event in line with ONS policy on Special Events. The event was not regular, so no adjustment has been made to account for it as part of the seasonal adjustment process. It is not possible to quantify the impact of the changes to the bank holidays at this stage; retrospective analysis will be carried out, in line with the ONS special events policy, when data for later periods are available. The bad weather in the quarter may have also had an impact in some components although it has not been formally designated as a special event.

The change in the bank holidays in May and June due to the Diamond Jubilee and the poor weather between April and June 2012 added additional uncertainty to the estimate for June 2012 used within the compilation of the quarter two 2012 preliminary estimate of gross domestic product (GDP) published on 25 July 2012. An article produced at that time showed users how the quarter two 2012 preliminary estimate of GDP was compiled.

International comparisons for Q2 2012

In 2012 quarter two, GDP fell by 0.2 per cent in the Euro Area and fell by 0.1 per cent in the European Union as a whole (EU 27). In the first quarter of 2012 GDP was unchanged in both areas.  These are based upon second estimates of GDP for the second quarter of 2012 published by Eurostat, the statistical office of the European Union. These second estimates contain later data than those available for publication of the flash estimate of GDP for 2012 quarter two.

  • Seasonally adjusted GDP in the Euro area is now 0.5 per cent lower than in 2011 quarter two. In the European Union as a whole, GDP is now 0.3 per cent lower than in 2011 quarter two.

  • United States of America GDP rose by 0.4 per cent in the second quarter of 2012 following an increase of 0.5 per cent in the previous quarter. Japanese GDP increased by 0.3 per cent in 2012 quarter two. This follows an increase of 1.3 per cent in 2012 quarter one.

  • When compared with the same quarter a year ago, GDP for the United States of America rose by 2.3 per cent and GDP for Japan increased by 3.6 per cent.

More detailed information on these estimates can be found on the Eurostat website.

 

International GDP Growth Rates, Quarter-on-Quarter, CVM SA

International GDP growth rates, quarter on quarter, CVM SA
Source: Eurostat

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Revisions, GDP and components previously published on 24 August 2012

GDP growth for 2012 quarter two has been revised upward by 0.1 percentage points from the fall of 0.5 per cent published on 24 August 2012. There has been an upward revision of 0.2 percentage points to 2011 quarter two and a downward revision of 0.1 percentage points to 2011 quarter three.

Gross Domestic Product, Quarter-on-Quarter Growth, CVM SA

Presents gross domestic product, quarter on quarter growth, CVM SA
Source: Office for National Statistics

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Output components

Growth in the volume of output in the production industries for 2012 quarter two has been revised upward by 0.2 percentage points. For 2012 quarter one there has been an upward revision of 0.3 percentage points. For 2011 quarter two there has been an upward revision of 0.1 percentage points. For 2011 quarter three there has been a downward revision of 0.2 percentage points.

Growth in the volume of output in the service industries for 2012 quarter two is unrevised from the fall of 0.1 per cent published on 24 August 2012. For 2011 quarter one there has been a downward revision of 0.1 percentage points. For 2011 quarter two there has been an upward revision of 0.1 percentage points. For 2011 quarter four there has been an upward revision of 0.1 percentage points.

Growth in construction output for  2012 quarter two has been revised upward by 0.9 percentage points and downward by 1.0 percentage points for 2012 quarter one. Construction output growth has been revised downward by 0.5 percentage points for 2011 quarter one; upward by 0.7 percentage points for  2011 quarter two; downward by 0.6 percentage points for 2011 quarter three and upward by 0.2 percentage points for 2011 quarter four.  

Expenditure components

Growth in household final consumption expenditure has been revised up by 0.2 percentage points for 2012 quarter two and upward by 0.4 percentage points for 2012 quarter one. For 2011 quarter one, household final consumption expenditure has been revised down by 0.4 percentage points. Household final consumption expenditure has been revised up by 0.3 and 0.7 percentage points for 2011 quarters two and three respectively. For 2011 quarter four, household final consumption expenditure has been revised down by 0.3 percentage points.

Growth in general government final consumption expenditure has been revised down by 1.6 percentage points for 2012 quarter two and upward by 1.2 percentage points for 2012 quarter one. For 2011 quarter one general government final consumption expenditure has been revised upward by 0.1 percentage points; down by 0.1 percentage points for 2011 quarter two; up by 0.2 percentage points for 2011 quarter three and down by 0.5 percentage points for 2011 quarter four.

Growth in gross fixed capital formation has been revised up by 0.5 percentage points for 2012 quarter two and revised up by 1.3 percentage points for 2012 quarter one. For 2011 quarter one, gross fixed capital formation growth has been revised down by 1.1 percentage points and up by 0.1 percentage points for 2011 quarter two. For both 2011 quarters three and four growth in gross fixed capital formation has been revised down by 0.1 percentage points.

Growth in exports of goods and services has been revised up by 0.6 percentage points for 2012 quarter two and revised up by 0.1 percentage points for 2012 quarter one. For 2011 quarter one growth in exports of goods and services has been revised down by 0.1 percentage points. For 2011 quarter two exports of goods and services growth has been revised up by 0.7 percentage points and down by 0.7 percentage points for 2011 quarter three. For 2011 quarter four growth in exports of goods and services has been revised down by 0.1 percentage points.

Growth in imports of goods and services is unrevised for 2012 quarter two and revised up by 0.2 percentage points for 2012 quarter one. For 2011 quarter one growth in imports of goods and services has been revised down by 0.3 percentage points. For 2011 quarters two and three imports of goods and services growth has been revised up by 0.3 and 0.1 percentage points respectively.

Income components

Growth in compensation of employees has been revised down by 1.6 percentage points for 2012 quarter two and up by 0.2 percentage points for 2012 quarter one. For 2011 quarter one, compensation of employees growth has been revised up by 0.1 percentage points and revised down by 0.2 percentage points for 2011 quarter two. Growth in compensation of employees has been revised up by 0.2 percentage points for 2011 quarter three and revised down by 0.1 percentage points for 2011 quarter four.

Growth in the gross operating surplus of corporations has been revised up by 8.9 percentage points for 2012 quarter two and revised down by 5.6 percentage points for 2012 quarter one. Gross operating surplus of corporations growth has been revised up by 0.3 percentage points for 2011 quarter one; revised up by 0.9 percentage points for 2011 quarter two; revised up by 0.7 percentage points for 2011 quarter three and revised up by 1.8 percentage points for 2011 quarter four.

Revisions, Sector accounts, previously published on 28 June 2012

Revisions have been taken back to 2011 quarter one in this release.

Net lending by sector: Table I

Central government

Net borrowing in 2012 quarter one was revised from £25.4 billion to £25.6 billion. 

Local government

Net borrowing in 2012 quarter one was revised from £9.5 billion to £8.3 billion.

Public corporations

Net borrowing in 2012 quarter one was revised from £0.2 billion to £0.4 billion.

Financial corporations

Net lending in 2012 quarter one was revised from £4.1 billion to £6.2 billion.

Private non-financial corporations 

Net lending in 2012 quarter one was revised from £18.9 billion to £12.5 billion.

Household and NPISH

Net lending in 2012 quarter one was revised from £2.4 billion to £2.6 billion.

Rest of world

Net lending in 2012 quarter one was revised from £10.2 billion to £14.5 billion.

Household and non-profit institutions serving households (NPISH) sector tables J1, J2 and J3

The household saving ratio was revised down in 2012 quarter one from 6.4 per cent to 6.0 per cent. This reflects upward revision to individual consumption expenditure and a downward revision to net property income.

Real household disposable income growth has been revised down from a fall of 0.9 per cent to an increase of 0.3 per cent in 2012 quarter one. 

Background notes

  1. Release policy

    This release includes data available up to 13 September 2012. Data are consistent with the Index of Production statistical bulletin published on 7 September 2012; the trade in goods data within the UK Trade statistical bulletin published on 11 September 2012 and the public sector finances data published on 21 August 2012. Revisions included in the Public Sector Finances release of 21 September 2012 will be included in the quarterly national accounts to be published on 21 December 2012.

  2. Future releases

    A preliminary estimate of GDP for the third quarter of 2012 will be published on 25 October 2012. The second estimate of GDP for the third quarter of 2012 will be published on 27 November 2012. A full set of quarterly national accounts for the third quarter of 2012 will be published on 21 December 2012.

  3. Release content and context

    This release is the quarterly national accounts (month 3). Data content for each successive release of GDP varies according to availability.

    The preliminary estimate of GDP (month 1) is based on output data alone. These are based on survey estimates for the first two months of the quarter with estimates for the third month of the quarter based on forecasts using early returns from businesses. Other (non-survey based) data used in the compilation of the output approach are also based on forecasts.

    For the second estimate of GDP (month 2) output estimates based on survey data are available for all three months of the quarter, in addition to other significant data sources. Estimates of the expenditure and income approaches to measuring GDP are also available in this release based on a combination of limited survey data, other data sources and forecasts.

    For the quarterly national accounts release (month 3) output survey data are available for all three months of the quarter, along with most other data sources. For the expenditure and income approaches to measuring GDP, more extensive survey data are available, in addition to other data sources and a more limited use of forecasts.

    After this release, the current quarter will be subject to revision in accordance with National Accounts revisions policy as further data, annual benchmarks and methodological improvements are implemented.    

  4. Measuring the impact of the 2012 Olympic and Paralympic games in the National Acounts

    An article titled 'Measuring the impact of the Olympics and Paralympic games in the National Accounts' is available on the ONS website which describes ONS' approach to ensuring that the planning, organising and economic activities associated with staging the games are recorded and recognised within the National Accounts.

  5. National accounts methodology and articles

    ONS regularly publishes methodological information and articles to give users more detailed information on developments within the National Accounts; supplementary analyses of data to help users with the interpretation of statistics and guidance on the methodology used to produce the National Accounts.

    Historic experience shows that the output approach provides the most timely approach to measuring GDP growth. GDP growth according to the expenditure and income approaches is therefore brought into line with that recorded by output.

    ONS has produced an article ‘Interpreting the Recent Behaviour of the Economy', available on the ONS website to aid interpretation of the recent movements in the economy.  

  6. National accounts classification decisions

    The UK National Accounts are produced under internationally agreed guidance and rules set out principally in the European System of Accounts 1995 (ESA 95), and the accompanying Manual on Government Deficit and Debt (MGDD).

    In the UK the Office for National Statistics (ONS) is responsible for the application and interpretation of these rules. ONS therefore makes classification decisions based upon the agreed guidance and rules and these are published on the ONS website.

  7. Basic Quality Information for GDP Statistical Bulletin

    Quality and Methodology Information report (518.9 Kb Pdf) for this Statistical Bulletin can be found on the ONS website.

  8. Key quality issues

    Common pitfalls in interpreting series: Expectations of accuracy and reliability in early estimates are often too high. Revisions are an inevitable consequence of the trade-off between timeliness and accuracy. Early estimates are based on incomplete data.

    Very few statistical revisions arise as a result of ‘errors’ in the popular sense of the word. All estimates, by definition, are subject to statistical ‘error’ but in this context the word refers to the uncertainty inherent in any process or calculation that uses sampling, estimation or modelling. Most revisions reflect either the adoption of new statistical techniques or the incorporation of new information which allows the statistical error of previous estimates to be reduced. Only rarely are there avoidable ‘errors’ such as human or system failures and such mistakes are made quite clear when they do occur.

  9. Reliability

    Estimates for the most recent quarters are provisional and are subject to revision in the light of updated source information. ONS currently provides an analysis of past revisions in the GDP and other Statistical Bulletin which present time series.

    ONS has a webpage dedicated to revisions to economic statistics which brings together ONS work on revisions analysis, linking to articles, revisions policies and key documentation from the Statistics Commission's report on revisions.

    Revisions to data provide one indication of the reliability of key indicators. The tables below show summary information on the size and direction of the revisions which have been made to data covering a five-year period. A statistical test has been applied to the average revision to find out if it is statistically significantly different from zero. An asterisk (*) shows if the test is significant. The result of the test is that the average revision is not statistically significantly different from zero.

  10. Revisions to GDP estimates

    Table 1 below shows the revisions to month 1 and month 2 estimates of GDP. The analysis of revisions between month 1 and month 2 uses month 2 estimates published from November 2007 (2007 Q3) to August 2012 (2012 Q2). The analysis of revisions between month 2 and month 3 uses month 3 estimates published from September 2007 (2007 Q2) to June 2012 (2012 Q1).

    Table 1: Revisions to early estimates of GDP growth

    GDP growth in the latest period (per cent) Revisions between early estimates of GDP growth (quarterly, CVM)
    Revisions to GDP growth   Average over the last five years  Average over the last five years without regard to sign (average absolute revision)
         
    Between M1 and M2 -0.4  0.02 0.07
           
    Between M2 and M3 -0.4 -0.03 0.08

    Table source: Office for National Statistics

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    Table 2 shows the revisions to GDP growth and the household saving ratio between the estimate published three months after the end of the quarter and the equivalent estimate three years later. The analysis uses month 3 estimates first published from September 2004 (2004 Q2) to June 2009 (2009 Q1) for GDP.

    Table 2: Revisions to month 3 estimates of GDP growth

      Revisions between first publication and estimates three years later
      GDP growth in the latest period (per cent) Average over the last five years  Average over the last five years without regard to sign (average absolute revision)
         
    GDP growth (quarterly CVM) -0.4 -0.16 0.36
           
    Household saving ratio  6.7 -0.95 1.21

    Table source: Office for National Statistics

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    Spreadsheets containing revisions triangles (real time databases) of estimates from 1992 to date and the calculations behind the averages in both tables are available on the National Statistics website.

    Revisions triangles for the main components of GDP from expenditure, output and income approaches are also available,

    An article titled 'Understanding the Quality of Early Estimates of Gross Domestic Product', which was first published in December 2009 is available on the ONS website.

  11. Balancing GDP

    Information on the methods ONS uses for balancing the output, income and expenditure approaches to measuring GDP can be found on the ONS website.

    The size and direction of the quarterly alignment adjustments in the second quarter of 2012 indicate that, for 2012 quarter two, the level of income was lower than that of output while the level of expenditure was higher than that of output.

  12. Further information

    Latest copies of this and other ONS releases are available under Press Releases on the ONS website. ONS has also produced a short guide to the UK National Accounts (93.6 Kb Pdf) .

    Details of the policy governing the release of new data are available from the media relations office. Also available is a list of the names of those given pre-publication access (38.7 Kb Pdf) to the contents of this bulletin.

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  14. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

    These National Statistics are produced to high professional standards and released according to the arrangements approved by the UK Statistics Authority.

Statistical contacts

Name Phone Department Email
Luke Croydon +44 (0)845 6041858 Media Relations media.relations@ons.gsi.gov.uk
Luke Croydon +44 (0)7867 906553 Emergency on-call media.relations@ons.gsi.gov.uk
Pete Lee +44 (0)1633 456713 Office for National Statistics gdp@ons.gsi.gov.uk
Get all the tables for this publication in the data section of this publication .
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