Addressing the Slugfest over Government Statistics
Rajesh Singh

The arena of government statistical data is an unlikely subject for a political slugfest, given that there is a plethora of issues that can and do engage those who are suitably inclined. Besides, it is too ‘dull’ a matter to catch the attention of politicians, much less the common man. And yet, in recent months, the government and the opposition parties have been at loggerheads over the credibility of figures the former has presented on the domestic economic situation. So much so that a section of economists drawn from within the country and abroad have, through a letter made public, raised allegations of political interference by the incumbent regime in the statistical data made available.

This group has slammed the alleged tendency of the government to “suppress uncomfortable data” and the use of “questionable methodology” to present statistics. These economists have said in the letter that “lately, the Indian statistics and the institutions associated with it, have, however, come under a cloud for being influenced and indeed even controlled by political considerations”. It added that while technical problems and errors in data collection are understandable, the “political system should been seen hands-off the data”. Among the signatories is Nobel awardee Abhijit Banerjee of the Massachusetts Institute of Technology. They raised doubts over the material presented by the Central Statistics Office (CSO), which were not in tandem with those of another government panel set up earlier.

They said, for example, that the CSO’s estimates in January of GDP growth rate for 2016-17 (the year of demonetisation) had gone up by 1.1 percentage variance (to 8.2 per cent), which was the highest in a decade, but it did not reconcile with the evidence “marshalled by many economists” on the ground. Besides other things, this group of economists and academicians emphasised on the need for “statistical integrity” which was crucial “for generating data that would feed into economic policymaking and that would make for honest and democratic public discourse”.

The government had also faced flak over the back series data on the base year of 2011-12, after a National Statistical Commission report of 2018 showed double-digit growth during some years of the UPA government. The government had promptly junked that report and replaced it with its own back series data, lowering the GDP growth rate of that period.

It is in the backdrop of such criticism that the Union government’s two decisions to address the issue should be viewed appreciatively. The first is the establishment of a Standing Committee on Economic Statistics by the Ministry of Statistics and Programme Implementation, to be headed by noted economist Pronob Sen and having 28 members — 10 non-official and others official. Sen is India’s first Chief Statistician. Among the members are three of those that had signed the letter slamming the government for fudging economic figures and alleging political interference. The panel subsumes four existing committees on similar matters and will have the mandate to review key economic data and trends. It will be also be tasked with reviewing periodic labour force survey, annual surveys of industry and the unorganised sector, economic census etc.

The second welcome step the government has taken is to initiate the process of giving statutory status to the National Statistical Commission. A draft legislation has already been put in the public domain to invite feedback from the public and other stakeholders. The Draft National Statistical Commission Bill, 2019, “seeks to constitute a National Statistical Commission (NSC) as the nodal regulatory body for all principal statistical activities of the country”. The commission, according to the draft Bill, will be headed by a chairman and have nine members (five full-time), including the Reserve Bank of India Deputy Governor and the Chief Economic Advisor to the Union Ministry of Finance. The members will be selected on the recommendations of a search committee constituted by the government.

The NSC, once given the regulatory authority, will “advise Central and State governments, courts and tribunals on matters relating to government statistic”. This would include the evolution of national policies, legislative measures, and laying standards for statistical concepts and methodologies. Periodic audits of surveys would be conducted by the National Statistical Audit and Assessment Organisation which will be set up within the NSC and headed by a Chief Statistical Auditor to be appointed by the government. A National Statistical Fund shall also be constituted, which will include resources received by the NSC through government grants, fees and charges, “and any other sources decided by the Central government”. The Bill also gives powers to the commission to “warn, caution or censure a government agency if (i) it does not comply with the standards of statistical ethics, or (ii) any person engaged in government statistics commits professional misconduct, making a false or misleading statement or material omission in any information furnished to the NSC”.

There are indications that the government wishes to set to rest the various controversies through this decision. The legislative backing will accord a level of autonomy to the commission and insulate it from government interference. There will also be financial autonomy which will help the NSC to discharge its functions with a great amount of independence. Besides, strict measures have been included to discourage false or misleading data. Unfortunately, there have been skeptical voices over the Bill, with dissenters claiming that the government would still have, according to the Bill’s provisions, control over the commission since the Bill says that the government would have the final say, regardless of the commission’s opinions.

But then, it must be kept in mind that while the NSC is sought to be a statutory regulatory authority, it remains advisory in nature and the government — this or any other — will retain the right to exercise its discretion. In itself, the provision does not necessarily dilute the importance or independence of the commission. The Bill is a major step towards empowering the NSC which was set up in June 2005 based on the recommendations of the Rangarajan Commission. The Rangarajan panel had been established back in January 2000 under the chairmanship of C Rangarajan to review the entire gamut of the official statistical system in the country. Among the key recommendations in its report submitted to the Union government in August 2001, was the creation of a national commission on statistics to serve as a nodal and empowered body for all core statistical activities conducted in the country. It suggested that the NSC be initially set up through a government order — and given a more permanent stature thereafter. The proposed statutory status will at the very least reduce the government’s grip on the NSC and make the commission effectively transit from executive control to legislative accountability.

(The paper is the author’s individual scholastic articulation. The author certifies that the article/paper is original in content, unpublished and it has not been submitted for publication/web upload elsewhere, and that the facts and figures quoted are duly referenced, as needed, and are believed to be correct). (The paper does not necessarily represent the organisational stance... More >>

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