Thoughts on Finance, Current Affairs and General Consumer Ripoffs - Damn Lies and Statistics

Latest press release from Department of Health announcing the spectacular sum of £25 Million being invested into hospital Maternity services. However the press release also says that this sum is being split between "more than 100" hospitals. So the sum per hospital is an average of under £250,000. In terms of medical equipment this is a drop in the ocean and hardly worthy of a dramatic press release getting headlines on news bulletins. Watch out for these statistical tricks - bundle up a small amount of money across a lot of destinations and it will then sound like a lot of money that can be a press release.   £250,000 = not a lot of publicity when it is one hospital   £25 million = same sum but split over 100 hospitals and is now headline news!

Tesco stores have reported their crucial sales for the Christmas 2012 period showing that on the key like-for-like measure their sales increased by 2%. However that isn't the full picture as like-for-like sales compare sales this year against last year in shops open at the time.  Christmas 2011 was notoriously bad for tesco and sparked the profit warning that led to a dramatic drop in their share price. Comparing a very low sales number in 2011 with a better number for 2012:was always going to flatter this years results so although tesco may have done well it probably isn't as good as they claimed.

In another blatant error in their use of statistics The Guardian have today claimed that First Time Buyers are putting down an average deposit of 80% which is out of reach of most FTBs!! You can certainly agree that an 80% deposit would be out of reach of virtually all buyers, whether first time or not! First Time Buyers Lending LTV Errors in The Guardian There seem to be a huge number of numeracy errors in Guardian stories these days, maybe resurrecting their reputation for typos that was generated in the 1980s and has largely been removed as a result of autocorrect and spellcheckers. Checking the validity of statistics is somewhat harder and can only be done by a human that understands the interpretation of the data, something journalists clearly do not. For the record the article should have stated that the average Loan to Value (LTV) was 80%, meaning that the average First Time Buyer was putting down a 20% deposit.

In 2011 the average wage rose at a rate of 1.4% with public sector workers facing a pay freeze. During 2011 the annual inflation during the year was 5.2% so wages rose more slowly than RPI inflation. Benefits rose by the September RPI figure of 5.2%. When Is a Pay Rise Reported as A Pay Cut? When it refers to benefits! In the December 2012 Autumn Statement, George Osborne announced that benefits would rise by 1% in 2013 and for the following 2 years. This was greeted by a wave of responses claiming huge cuts, benefits being slashed, decimation of welfare and the like. Did we see any such howls of protest when wages were rising more slowly than prices but benefits were still being automatically uprated by inflation? Did workers shout about a 5.2% pay cut they faced? No I think not. Remember, benefits are NOT being cut. Welfare is NOT being slashed. Benefits are still rising and are not being cut. Wages in the NHS and local councils have been frozen without an annual incr...