Consumer expenditure data was not shared with Statistics Commission; standing committee kept in the loop

The HCES – which is crucial to updating macroeconomic indicators such as the consumer price index and establishing a new poverty line – currently in use is the one conducted in 2011-12 (July-June) after the 2017-18 HCES was shelved by the government in late 2019 due to what it termed as “data quality issues”

India's statistics ministry, tasked with collecting and disseminating vital economic data, did not share the latest Household Consumer Expenditure Survey (HCES) data with the National Statistical Commission (NSC) before releasing a factsheet on the 2022-23 (August-July) HCES on February 24, according to people aware of the matter.

The full report on the survey, the Ministry of Statistics and Programme Implementation's (MoSPI) factsheet said, will be released "subsequently".

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"If one looks at the mandate of the NSC, it is all-encompassing. But in practice, it is only an advisory body – to give advice when asked. Thus, NSC does not even know the answers to your question," Rajeeva Laxman Karandikar, chairperson of the NSC, told Moneycontrol when asked about the details of the 2022-23 HCES and when the full survey report will be released.

The autonomous NSC, set up in 2006 as per the recommendations of the Rangarajan Commission, is chaired by an eminent statistician and has the status of Minister of State, with the other members at the level of central government secretaries. The NSC's mandate is to "evolve policies, priorities, and standards in statistical matters".

While there is no statutory requirement to seek the NSC's approval, some experts say its views should have been sought.

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The HCES – which is crucial to updating macroeconomic indicators such as the consumer price index and establishing a new poverty line – currently in use is the one conducted in 2011-12 (July-June) after the 2017-18 HCES was shelved by the government in late 2019 due to what it termed as "data quality issues".

Standing committee's approval

The statistics ministry did show the 2022-23 HCES factsheet to the Standing Committee on Statistics (SCoS) before its release, Pronab Sen, chairman of the committee, told Moneycontrol.

"The Standing Committee's approval was not technically required. But we, the SCoS, did see the factsheet and approve it for technical reasons. But that cannot constitute a reason for release (of the factsheet). It should have been put up before the NSC," Sen said.

The statistics ministry did not reply to an e-mail asking for comment.

According to Sen, while the SCoS will have to approve the final 2022-23 HCES report, it is the NSC that has the authority to "vet all statistical data". As such, "the NSC chairperson should be very upset about not having seen the HCES factsheet before its release," said Sen, India's first chief statistician.

The SCoS was constituted in July 2023 "to deliberate and deliver various issues related to all surveys as and when required by MoSPI".

The 2019 episode

The apparent sidelining of the NSC is not a recent phenomenon, with Sen commenting that it has occurred over the past few years. The first public instance of this was seemingly in January 2019, when PC Mohanan, then the acting chair of the commission, and fellow member JV Meenakshi resigned in protest after a survey report they approved – which showed the unemployment rate in 2017-18 was the highest in 45 years – was not released by MoSPI.

A day before the Interim Budget for 2019-20 was to be presented, the then NITI Aayog Vice Chairman Rajiv Kumar held a press conference on January 31, 2019, to dismiss media reports that the aforementioned report showed unemployment in 2017-18 had risen to 6.1 percent. Kumar said the findings were that of a 'draft' report that was yet to be approved by the government.

The report was finally released on May 31, 2019, days after the results of the Lok Sabha elections had been declared. It showed the unemployment rate in 2017-18 was indeed at 6.1 percent, the highest in at least 45 years.

"When the NSC was formed (in 2006), it had full control over the NSSO (National Sample Survey Office) and a good working relationship with MoSPI," Mohanan told Moneycontrol last week.

"But this changed around 2016 or so and it became problematic. And the NSC was almost ignored by the government starting 2017-18 or so," Mohanan, now the chairman of Kerala State Statistical Commission, added.

A senior official from the statistics ministry was broadly in agreement with this timeline, saying that "when Pronab Sen and TCA Anant were the secretaries (of MoSPI), they would handle everything, and there would be no problem".

Anant retired as the chief statistician of India in January 2018.

The office of GP Samanta – appointed the MoSPI secretary and chief statistician of India in March 2021 – did not respond to multiple interview requests.

The way forward

Over the past year, MoSPI come under severe criticism from various quarters, including members of the Economic Advisory Council to the Prime Minister (EAC-PM), who wrote multiple newspaper columns in July 2023 questioning the ministry's data collection frameworks. According to Karandikar, "there is definitely an urgent need to overhaul the statistical system".

"But how it can be done, that's a question mark. Technically, it should have been the NSC's mandate. But NSC is seen as an advisory body and thus is unable to do so," he added.

For Sen, instead of an overhaul, restoring MoSPI's credibility is crucial.

"Earlier, it (credibility of data) didn't matter so much simply because the principal user of the data was the government. Now, MoSPI's data is used by everybody: the government, corporates, NGOs, etc. Therefore, it is even more important now that government data is credible," he said, adding that the EAC-PM and the NITI Aayog "have no locus standi" when it comes to the official statistics and are "usurping the role of the NSC".

The problem, as per Sen, is the government's "excessive focus on data". Mohanan also pointed out that a "gradual indifference and lack of interest and direction" has crept into the collection of data and official statistics "because the lack of data means you can make claims and counterclaims".

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According to Mohanan, the Indian Statistical Service "is working fine", and the NSC needs to be revamped with a larger set of experts.

The NSC currently comprises only three members: Karandikar, Professor Mukesh Mohania from Indraprastha Institute of Information Technology, Delhi, and Asit Kumar Sadhu, Chief General Manager of Planning and Statistics at the National Highways Authority of India. In addition, NITI Aayog CEO BVR Subrahmanyam and MoSPI Secretary Samanta serve as ex-officio members, with Samanta also holding the role of NSC secretary.

Two posts for members in the NSC are vacant at the moment, though efforts are underway to fill them.