Measuring Illegal Activities in the National Accounts

Brian Sturgess

Published: June 2018

Until 2014 the only illegal activity measured in the UK National Accounts by the Office of National Statistics was the smuggling of alcohol and tobacco. The European System of National Accounts 2010 requires statistical bodies to measure consensual illegal economic activities such as drug consumption and prostitution. In 2014 the first estimates measured the contribution of illegal drugs and prostitution at 2009 prices to UK Gross Domestic Product (GDP) at just under £10 billion. The estimates are based on a flawed methodology using survey data while private sector figures suggest that the contribution of the cannabis market alone to GDP may be over three times the official value of £828 million .