Comments on today's revised Q1 2012 GDP figures

Mike Robinson, senior partner at PwC Milton Keynes, commented:

"Total revised GDP data showed no change in the big picture that the UK economy has been broadly flat for the past 18 months, with output in Q1 2012 at the same level as in Q3 2010. The ONS estimates are still showing a technical recession due to a fall of 0.3% in GDP in Q1 2012, but this estimate still looks somewhat downbeat compared to stronger labour market and business surveys indicators for the same period. As today's historic revisions remind us, these early ONS GDP estimates could well be revised significantly in future years.

"More detailed revisions showed investment significantly stronger in Q1 2012, but consumer spending and particularly exports weaker. An oddity of the ONS data is that, despite more subdued cash spending by government, real growth in government consumption appears surprisingly strong over the past year. This may, however, be more reflective of the difficulties in measuring government sector output than being an accurate indication of what is actually happening in the public sector. For example, the number of pupils taught may rise but, if schools can afford fewer teachers and computers, the quality of teaching may suffer leading to poorer exam results over time, but this could go unrecorded in these national accounts estimates until some years later."