Quality assuring the UK business register Andrew Allen

Quality framework Relevance Coherence Timeliness/ punctuality Accuracy Comparability Accessibility & Clarity

Aspects of UK register quality Relevance – Business register coverage Coherence - Administrative data input/ Profiling Timeliness/ punctuality - Updating frequency Accuracy – Register maintenance survey Comparability – Quality control Accessibility & Clarity - NSBRG/ Web site

Coverage Vital that register coverage is very high UK register based primarily on sales tax (VAT) and employers tax (PAYE) – relatively high thresholds Explored other sources to assess coverage Are other sources worth developing?

Other sources –Corporation Tax Legal Barriers Aggregate comparisons annually – give assurance of coverage Identified small company gap Would be beneficial – identifying small trading companies below VAT and PAYE threshold Possible access through new legislation

Sources – business directories Commercial databases – e.g. Yell Thought to reach small businesses below threshold Mostly consumer facing businesses - bias Good for phone numbers Expensive and commercial sensitivities

Sources – Valuation Office For rateable value of businesses -site based Potential source of local units Occupier names missing/ empty properties Can indicate missing local units Worth revisiting

Sources – Company registrations Used as a third source already Some registrations not on the register Examined a sample of the missing and their accounts to see why Many are not trading or for leaseholders. Challenge is to identify those trading

Coverage summary Current coverage meets existing needs None of the new sources would provide complete coverage Pursuing Corporation Tax in conjunction with further use of Companies registrations offers most cost-effective way to improve coverage

Universe coherence Different data sources lead to conflicts Administrative data held outside survey scope until quality assured – avoids duplication and sectoral bias Examples: Discrepancies between sources e.g. high PAYE employment – low VAT turnover Company registration – but no tax registration Integration of farms register

Timeliness Lags in administrative processes impact on quality Example: UK VAT data daily, but months lag in VAT process Administrative death process Monitor changes in lags over time

Quality assuring input data 2.1 million active enterprises Team of 10 check administrative data inputs 21 daily VAT reports plus less frequent checks 40 checks applied to PAYE data quarterly Examples – large growth, large births, death check against other sources, size across sources

Impact of new tools on quality New tools can lead to discontinuities Improved matching software IDS Better match rates–meant units previously held outside universe as suspicious moved into scope of survey Introduced in controlled way in agreement with survey users

Register maintenance surveys Principally for keeping local unit structures up to date Around 75,000 businesses per year sampled Complex businesses sampled each year Simple businesses less frequently Sample of businesses with PAYE and register employment failing a closeness rule

Redeveloping the register survey Merged with an annual employment survey Will yield saving and improve coherence Business register and employment survey

New sample design Complex* 20+ FTE 1in1 * active in more than one region and industry Simple 100+ FTE 1in1 Unusual cases (employment) 1in1 Simple stratified by NACE 1 in 2 Simple < 20 FTE stratified by NACE 1 in 500 Administrative data used for most enterprises <20 FTE

Profiling Team of 8 Profile 500 large complex businesses each year To improve coherence between ONS surveys To reflect current operating and legal structures To improve response to ONS surveys.

Monthly quality control Alerts users to change over time Change to top level universe Change to employment, turnover and number of businesses Drills down into industry, region, legal status, administrative sources % change by size, used to assess impact – traffic light system

Annual quality reports Small change each month – can show trends Timed to check quality before main annual survey samples taken Also used to quality assure the business register survey – 0.5 million LU’s updated each.

Special industry checks Monitoring of industries with known special criteria e.g. large employment required, only a small number in the country, discrepancies between employment/turnover Examples: Glass and steel manufacturing Holding companies Investment companies

Accessibility Feedback on register quality Web publications National Statistics Business Register Committee – key government users across UK Annual survey of users

Summary - UK register quality Part of continuous improvement Paying attention to administrative data Extending business register outputs More efficient surveys Communicating with customers