Govt shouldn’t junk unpleasant data (Trust in statistical data means a lot)

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 Govt shouldn’t junk unpleasant data (Trust in statistical data means a lot)

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• Data is the new oil: The Ministers of GoI often claim that "Data is the new oil" and want credible data on economy to be able to fight problems. They want data centre parks across India to integrate data with value chains.
• Discrepancies in Budget data itself: On the other hand, what we see is that many data points in Budget itself were wrong, and secretly rectified later on. And once more, very high gross tax revenue growth targets were assumed, at 12%. (estimated nominal GDP growth rate is 10%; for 2018-19, GTR grew by 4% and nominal GDP by 7.5%)
• It started with jobs data: Comprehensive jobs data is not being released for long now. The NSSO's 2017-18 PLFS pointed out that at 6.1%, the unemployment rate was highest since 1972-73. (PLFS - Periodic Labour Force Survey)

1. The shrinking workforce (4.7 crore less from 2011-12 to 2017-18) was another shocker
2. CMIE separately found that these figures weren't wrong
3. The entire PLFS report was junked, leading to resignation of key persons in National Statistical Commission (NSC) [report was officially released much later]

• Irrelevance kicks in: Then the GoI started making indirect and irrlevant job creation claims. 

1. It claimed that higher EPFO and NPS enrolments showed more jobs were created, but they only showed more formalisation (DeMo and GST) and more pension scheme adoption!   (EPFO - Employees' Provident Fund Organisation, NPS - National Pension Scheme)
2. MUDRA loans were then used to prove jobs were being created, but MUDRA is a refinancing scheme that re-routes priority sector lending to non-corporate, non-farm SMEs.

• Enterprise Survey Report junked: It has said that a majority of India's regd. firms are bogus! Report was released, not junked, but the NSSO report (76th round) was not released. It contained the Consumer Expenditure Survey 2017-18 report.
• Leaked draft: The NSSO's CES draft was leaked showing per-capita monthly expenditure (inflation adjusted) falling by 3.7% to just Rs.1446, between 2011-12 to 2017-18. Food spending contracted in rural areas!  (so poverty has risen)
• Poverty rate in 2017-18: CES showed that 32% of population may be living in poverty (10% higher than that in 2011-12). The GoI junked the report! 

1. The Annual Employment-Unemployment Survey (EUS) and Quarterly Employment Survey (QES) too were junked
2. Reason given by MoSPI? Divergence in data compared to other administrative sources (but that is nothing new)

• Explaining the divergence: Administrative data are production data generated by govt. agencies. Such production is consumed domestically, exported or inventoried. But NSSO CES was all about household consumption, so divergence will happen.
• Earlier shocks: Declining consumption was seen in 1960-66, and 1973-74, both periods of crisis. This time round, the high GDP growth rates of 2011-12 to 2017-18 make falling consumption a dangerous truth the govt. wants to dodge.
• What used to happen earlier: Disliking inconvenient data is common, but earlier government ordered fresh surveys, and did not simply junk and suppress permanently. Today, we are witnessing a dangerous trend which will ultimately harm the govt's ability to forumlate policies properly (poor data, poor policies). 
• Summary : The trend of junking statistical reports has gathered pace, and does not bode well for the government's policy forumating abilities.

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