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Data conundrum: Is NSO really the answer to India's statistical confusions?

On the very first working day of its second successive five-year term, the National Democratic Alliance (NDA) government owned up some of the key statistics that had raised some questions earlier this year over economic performance in its previous term in office. So, are the controversies about the numbers clearly behind us now? The supposed embarrassment within government circles about facing general elections with such data does not exist anymore.

The answers matter; the Ministry of Statistics and Programme Implementation (Mospi) a week earlier proposed the creation of a National Statistical Office (NSO) through a merger of the Central Statistics Office and the National Sample Survey Organisation (NSSO). This proposal has created a controversy, too. But, if two key published data sets that showed the government in an unflattering light and were still officially acknowledged, should there be a reason to suspect any ulterior motive behind the government proposal to rework its statistical machinery? The Organisation for Economic Co-operation and Development (OECD) framework, which the NSO will seek to copy, clearly mandates that the body should be independent from political interference and should conform to international standards.

India already has a National Statistical Commission to operate as the nodal agency for core statistical activities, including setting and enforcing statistical priorities. Would an NSO do that better?

The government press release notes that there would be better handling of data points if there was an NSO “to be headed by a National Statistician, with appropriate autonomy and independence for producing official statistics as is prevalent in other countries”. Experts note that such autonomy and independence are necessary but not sufficient for a statistical system. There has to be a building up of capacity, too. This is where the Indian statistical system has lagged despite a long history.

India was one of the first independent countries to build up a robust statistics machinery and that fed the data requirements of twelve Five-Year Plans. But it remained under-financed. The total budget of the department for FY20 is just Rs 1,271 crore, one of the smallest budget heads of the government. Delhi University, for instance, has a comparable budget. The Registrar General & Census Commissioner, under the home ministry, gets a budget of just about half that amount for the statistics ministry, though its activity peaks in a ten-year cycle. To garner a wide range of statistics from a population of 1.3 billion every year, as the statistics ministry does, this sum is peanuts.

Beyond the money, there also is the issue of professional independence of the statistical machinery. “There are questions about the data been put out now and data put out in the past,” says India’s former chief statistician, Pronab Sen. He says the statistics system is not attracting the best talent and is understaffed. Mospi employed 6,319 people in FY19. This number has got bumped up from 4,509 in FY17 after a long plateau. “China, for instance, deploys more than 20,000,” Sen remarks. This is a point with which former member of the National Statistical Commission, Amitabh Kundu, also concurs.

Yet, none of them is excited about plans to create a National Statistical Office. Their concerns stem from the possibility that it is the government that would decide the data to be collected and how, a role that is under the oversight of the NSC at present. Incidentally, the publication of the Periodic Labour Force Surveys (PLFS) data was cleared by NSC under acting chairman P Mohanan, but it was delayed.

Economist Laveesh Bhandari says these problems will not disappear with the formation of an NSO, unless the capacity of the system is improved. “The political problems come up because the underlying problems of inadequately constructed data are not sorted through”. Each iteration of the revised gross domestic product (GDP) data drew controversy. In 2018, an NSC sub-committee calculated a back series with the new base year to show GDP growth through the United Progressive Alliance (UPA) decade as being better than earlier reported. The ministry rechecked the data and then published revised back-series data, which put the UPA performance in a less flattering light — a move that the Congress party called “a joke”. The first one was released without authorisation of the NSC, the second one when the NSC had become defunct.

But current chief statistician Pravin Srivastava says the NSC will continue in its role. “The status of the Commission remains unaltered and it continues to have the overall responsibility for providing strategic direction and leadership to the national statistical system”. It makes no reference to independence but the OECD, on whose recommendation the NSO is to be set up “as the leading statistical agency within a national statistical system”, makes it clear that this independence of the statistical machinery is sacrosanct. In its “recommendation of good statistical practice”, issued in 2015, it notes that any NSO must...

a) be protected, through the inclusion of explicit provisions in statistics legislation from political and other interference in developing, compiling and disseminating official statistics.

b) get a legal status, and thus

c) obtain a clear mandate to collect data for statistical purposes.

For this, the national statistical authorities must get “professional independence”. This must include sticking to international standards like those laid down by the International Monetary Fund (IMF) and the OECD.

Only then can the system assure “the impartiality, objectivity and transparency of official statistics”. Kundu says this is essential to ensure that the NSO starts with credibility on its side. “Data is important to ensure development goals are met. If the credibility of data itself is contested, then deciding on policy becomes that much more difficult.”

OECD norms for each country NSO mandates: 
  1. Legal status NSO
  2. A clear mandate for institutions to collect data for statistical purposes
  3. Ensure professional independence of National Statistical Authorities from other policy, regulatory or administrative departments as well as from private sector
  4. Have the exclusive authority, as part of their professional independence from political and other interference
  5. Ensure adequacy of human financial and technical resources
  6. An evidence-based self-assessment where implementation to these recommendations and good practice is substantiated through documentation and referencing
  7. A peer review
Indian Statistical System:

A: National Statistical Commission with five members including a Chairperson and four Members

Plus

Secretary: Chief Statistician of India is the Secretary of the Commission. 
One Ex-officio member: CEO, NITI Aayog 

Commission decides which core statistics, which are of national importance and are critical to the development of the economy. Those should be developed by

B: Ministry of statistics and programme implementation:
  1. Central Statistical Office (CSO)
  2. National Sample Survey Office (NSSO)


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