The Centre is yet to unveil the results from India’s quenquennial employment survey, carried out by the National Sample Survey Organisation (NSSO) every five years since 1972-73, though it was scheduled to be released in December 2018. The acting chairperson of the National Statistics Commission (NSC) P.C. Mohanan decided to resign in protest against the Centre’s decision to withhold the crucial data, ostensibly because it reflected high unemployment under the NDA government's watch in 2016-17. The jobs report, however, was only the last straw in a series of steps taken by the Centre to undermine and dilute the Commission’s authority, Mr. Mohanan said in an interactive session in Mumbai at the Mumbai Collective. Edited excerpts from his conversation with Indira Gandhi Institute of Development Research professor R. Nagaraj:
R. Nagaraj: How is the functioning of the statistical system different from standard bureaucratic operations?
P.C. Mohanan: The statistical system is actually part of the government system, but in the last 25-30 years, it has been recognised that the statistical system has to keep an arms’ length distance from the government. It has to be away from the government, though they are all government officers working there. Towards this end, the United Nations also suggested that there should be independent bodies to supervise and maintain the integrity of the statistical system. Our government also accepted these principles. We also set up independent commissions, which will have an oversight on the numbers that the official statistics machinery produces and it also decides the professional techniques that go into these numbers. So we did these things, but fortunately for India, we had an excellent way of bringing external expertise into the system by having a specialised working group for every activity. So these experts are fully aware of the methodology we use and we take their expertise on board. This is an excellent system we had developed and India can take pride in that, because some institutional survey bodies like the NSSO, set up almost at the time of Independence, have maintained integrity all along. They have been a sort of beacon light for other nations to follow. The National Sample Surveys (NSS) have been repeated elsewhere and the World Bank also recommended similar surveys. So all along, we have had an excellent, autonomous and independent system working here. And this Commission was also established towards that end. So on Statistics, India has been a model state for all countries.
RN: Economists call statistics public goods, which every agency, be it government, non-government or international agencies, uses. And the production of these statistics is a public service. India has been a pioneer in statistics thanks to its architect, Dr. P.C. Mahalanobis. By 1951, we had the first NSS done at a time when most of the world didn’t have such systems in place. Weather data in India is vetted by the Cabinet Secretary before it is released, but employment or other economic data is released by the Statistics department directly after being vetted by experts. How have things changed now?
PCM: Some of the key data indicators have a release calendar. The Gross Domestic Product (GDP) data comes on a given day, the Index of Industrial Production (IIP) comes on a set date exactly at 5 p.m. So nobody can alter those timings... But when it comes to survey data or other statistics like Census, there is no fixed calendar. So one way of influencing the figures if they are not very comfortable, is to hold it up. Now something like that happened in the case of employment data. In 2011-12, we had the last employment, unemployment survey conducted by the NSSO. It was supposed to come every five years. It took a little longer as we thought we will modify the structure of the surveys. Meanwhile, there was another survey by the Union Labour and Employment Ministry to fill up the gaps. The Labour ministry results used to get released every quarter. The first two years, it came on time... but later on, there was a delay when unemployment numbers were going up. Finally, that stopped coming though I was told the reports were all ready. There’s another agency in Mumbai called the Centre for Monitoring the Indian Economy, an exceptionally professional body doing a job that is even better than the NSSO in some aspects, because of the technology that they use. They have been filling the vaccuum or gap in employment data for the last two years or so. And those figures have also been showing that the unemployment rate is high. But the government has a way of saying ‘No, no, it’s a private agency and so it is not credible.’ With NSSO data, nobody could question the credibility. We in the National Statistical Commission had already decided to release the 2016-17 survey results in December 2018. That decision was, in fact, taken a year earlier. By December, I was the acting chairman so we had a meeting, looked at the reports, relooked at the methodology... we can not correct the figures or anything.. we can only check the methodology to see if it is comparable or not (with past data). So we decided it should be released. Normally, when the Commission decides, it is released within a few weeks or 10 to 12 days. This time, that did not happen.. and now the reasons became obvious after the results were revealed by a very good reporter. But as for me, I had a few options. One was — if I keep quiet, the report will go under the table of some department and never come to light. So at some stage, I thought I should take a stand as I cannot acquiesce to this kind of practice, though I have spent my entire life as a government employee. I spent about 35 years in government, and another two-three years in international agencies, but when I had been given this responsibility to oversee the system and ensure that the data is credible, and I am not allowed to do it, then I should not sit there.
RN: Since 2015, we have had a series of problems with official data, be it the revised GDP data series that did not pass the smell test. This January, the revised estimates for GDP in 2016-17 said growth was 8.2% — the highest in a decade in the year that demonetisation took place. The Home Ministry has stopped publishing farmer suicides data after 2016...
PCM: The new series of GDP data involved a change in methodology and they couldn’t go back as there was a real shortage of data. What the Commission found was there was an eagerness on the part of the government to get it released as soon as they got one set of figures, without consulting the Commission. Coming to the employment issue, which was a very critical thing for the government, because there have been lot of stories going on about millions of people driving Ola and Uber and getting jobs, pakoda sellers coming up as a business... so it was important for the government to get the right numbers. The employment supply, that is, labour comes from households, and business absorbs them. So all labour force surveys in the world do household surveys for employment surveys. The government tried to get some figures from the Provident Fund office, Mudra loans, and so on. But these are not the right methods. The method has to be household surveys which the NSSO had been doing. In 2016-17, the NSSO thought we should start having annual figures for employment, not every five years. The feeling was that we should have some quarterly data like all developed countries have. We thought in the Indian context, given the high informal engagement, the quarter to quarter changes may not be significant. So we decided that quarterly data we will do for urban areas, but for rural sector, we will do a normal survey but let us do it every year now. So that we have a better measure of the changes taking place. And all of us know that in the last year, a lot of changes have been taking place in the structure of the workforce, the enrollment rate at educational institutions has gone up, the percentage of graduates in every State is going up... All these things have an impact on the employment rate. So it was important to measure this on an annual basis. This was to be the first one, but tragically nobody has seen the face of the first report so far.. it is still being kept under wraps by the government. They tried to say that methods were different, but the methods are same and there is no comparability problem. They said it’s a draft, but once the Commission approves it, it is no longer a draft. So we have answered all the queries of the government and I personally hope that they will release the report so that people can debate about that. Transparency is the most important thing. Even if there is a methodological problem, researchers can find it out and tell the people. But if figures like GDP get revised repeatedly, that’s a problem for everybody – for investors, international agencies, and the government. Revisions take place in every country, but the magnitude is an issue. If you revise the GDP numbers, and the trend changes, how do you take investment decisions... that is an important issue. So both these issues are very relevant and it is unfortunate for the system which is so sound and strong, that these two issues have come up to the fore, and it is important that these are resolved at the earliest, and we go back to the normal style of functioning.
RN: As per your experience, how did things start deteriorating?
PCM: I will not be able to make you happy by narrating deteriorations. I have been part of the system... these kind of issues were earlier also there. The government is not comfortable with survey reports. It has happened in the 2009-10 survey also, because employment parameters came down. So there was a feeling that the impact could be due to the global meltdown (financial crisis). So nobody stopped the report, what they said is let us do another survey and check the results. And another survey was done in 2011-12. Similarly, when reforms started in 1990s, I was in the NSSO, the poverty figures were coming out. If you used NSSO data, the poverty was showed as higher. But nobody was saying don’t release the report. The reports were released and people analysed them. The kind of issues that you are comfortable with – you have certain narratives and are only comfortable with those numbers that go with the narratives, that is something that we feel is a new thing. And I told you the Labour ministry reports were not published, the NSSO reports were withheld and the GDP issues have got confused because so many series and so many revisions have taken place. But in other ministries, if you don’t have a regular system of release calendar, you will never know which reports are being kept under wraps. These are very important issues for a democratic society because we need the data to inform our understanding of how the government functions. It’s very important, but I will not be able to say more. These two are very important issues as they relate to the ministry of Statistics and two internationally-renowned organisations — CSO and the NSSO. They are the most important statistical offices in the country and if something affects them, it’s worrying.
RN: The NSC was set up on the recommendations of the C. Rangarajan Committee on National Statistics. How did the original vision for the Commission’s watchdog role get diluted?
PCM: The Rangarajan Committee recommended that there should be a permanent Commission to oversee the statistical system in the country. The Rangarajan Commission was appointed by the Atal Bihari Vajpayee government. In 2006, the NSC was set up as a temporary thing, and was to become a statutory body in due course. Efforts were being made to make it a statutory Commission and the legislative bills to back this were almost ready. Then this government came. Unofficially, I was told they did not want any more Commissions. So they said, let there be no permanent Commission, let the existing one continue as it is. Now, the Commission as it is, is not a very ideal situation as we had a very small secretariat, and the Chairman and members were part-time. But the government took a lot of initiatives on paper, like publishing a national policy on fundamental principles of official Statistics. This is an United Nations-backed principle which says that the official statistics should be produced independent of the government. On paper, the government also said the Commission must be consulted for any major statistical initiative. Now, once I became the acting chairman, I found that the government has not been consulting the Commission for many things. They had planned for a gigantic Economic Census without consulting the Commission. They had tried to bring out a national policy on Statistics. Three or four such incidents were there. But when this issue of the NSS report came, and remember, the NSSO is strictly under the Commission. So when the Commission approved the report, and the government did not release it... that was the last straw. ‘I will consult you if I require, otherwise I won’t consult you,’ — that was the kind of approach, so I thought there is no point in remaining for the rest of my one-and-a-half years in the Commission. In such a situation, a person has just three options – one is to forget about the mess and do nothing, Chalne dijiye.. Mujhe kya karna hai... The second option is to try to protest staying in that position. The right impact, I thought would be made if I just leave the place.