‘It is a tale told by an idiot…’

Data collection and its dissemination is an exercise impacting on politics the world over; however, the capacity of any administration to manipulate data is a function of the system of checks and balances in place.

In Pakistan there are few checks and balances in place and the usual modus operandi of ministry of finance/Pakistan Bureau of Statistics (PBS) personnel is to disregard any challenge to data integrity usually by a handful of academicians with student manpower, time and capacity to painstakingly identify lack of rationalisation between one statistic and another as released by different government agencies.

In the event that an academician has a voice in the media many a finance minister inducts him/her into a high level advisory council with the stipulation that they do not air their criticism in the media.

Data manipulation is targeted at three distinct groups in this country – the general public, those focused only on political as opposed to economic considerations, and multilaterals/bilaterals with associated loan conditions as Pakistan’s dependence on foreign borrowing to meet not only external debt payments but also for budget support has been rising each year.

Inflation is the most important indicator for the general public. Pakistan has witnessed three administrations since 2019 and not a single one has taken on responsibility for the persistently high inflation rate. The Pakistan Tehreek-e-Insaf (PTI) administration blamed its predecessor (PML-N) for leaving behind the highest ever current account deficit of 20 billion dollars, which necessitated going on an International Monetary Fund (IMF) programme with all associated harsh upfront prior conditions. This, in turn, required implementing administrative measures - raising electricity and gas rates as well as the petroleum levy - to achieve full cost recovery.

The Shehbaz Sharif-led eleven-party administration (April 2022-August 2023) blamed the PTI for agreeing to the IMF measures and after the induction of Ishaq Dar as the finance minister on 27 September 2023 began reneging on the agreement leading to its eventual suspension with the threat of default looming large on the horizon. The then Prime Minister was compelled to agree to even harsher administrative measures to reach a staff level agreement on the Stand By Arrangement (29 June 2023).

The incumbent Caretakers are implementing all measures agreed under the SBA which account for a Sensitive Price Index (SPI) of over 44 percent year on year for the week ending 4 January 2024 – a rate higher than the 30 to 35 percent rise in salaries of civilian and military personnel at the taxpayers’ expense (with clerks recently protesting at lack of implementation) and those employed in the private sector not receiving any inflation indexed wage rise due to the ongoing economic impasse.

Inflation data calculated for last month by PBS clearly needs some clarity on two counts: (i) the wholesale price index (WPI) declined from 34.1 percent July-December 2022 to 25.37 percent in the comparable period of 2023, a trend that is in marked contrast to the monthly consumer price index (CPI) and the weekly Sensitive Price Index (SPI) – CPI was estimated at 28.79 percent July-December 2023 compared to 25.02 percent in the comparable period of the year before while SPI rose from 28.21 percent in the first six months of 2022 to 31.38 percent in 2023; (ii) average SPI July-December 2023 is estimated at 31.58 which is a whopping 11.48 percent lower than for the week ending 4 January 2024.

However, what is ignored by the PBS staff and their handlers is that each time a householder goes to the market to buy any item he/she becomes fully aware of how much the rupee has eroded from one week to the next.

The census results have great political implications - from the Election Commission’s subsequent delimitation exercise that can change (expand or contract) a constituency, determine the federal allocation of jobs and the share of a province in the federal divisible pool (even though the National Finance Commission, due to be deliberated every five years was last agreed in 2010).

This explains why the Economic Survey 2022-23 noted that the National Institute of Population Studies (NIPS) estimated population of Pakistan at 229.22 million in 2022 while acknowledging that this was a projection not on the basis of Census 2017 which was highly controversial particularly as far as the major parties in Sindh were concerned, but on the basis of Census 1998 – an element that presupposes no change in the country’s birth rate for a quarter of a century.

And finally, the need to manipulate data is seen in the context of convincing a foreign lender that the agreed loan conditions are being implemented leading to disbursement of the next tranche or approval of a new loan.

An example is the economically flawed policy to control the rupee-dollar parity implemented till late January 2023, abandoned to lure the IMF team to reach a staff level agreement on the pending ninth review of the Extended Fund Facility (EFF) programme, and naively at best, unwisely at worst the parity was controlled again a few weeks later which accounted for the suspension of the programme – a claim noted in IMF documents.

There is an entire range of macroeconomic data that is almost routinely manipulated at the behest of our political leadership, be it civilian or military, which misleads the public, regional politicians or donors however all this achieves is to compromise the capacity of the economic team leaders to take appropriate timely measures to forestall the onset of an economic malaise or indeed to deal with an ongoing crisis as evident to this day.

To conclude, there is absolutely no value to data manipulation, only damage to the administration’s capacity to deal with crises in time which almost certainly will damage the party in power’s future political aspirations bringing to mind Shakespeare’s words ‘it’s a tale told by an idiot signifying nothing.’

Copyright Business Recorder, 2024