Economy

NSO Will Not Release Report Showing First Decline in Consumer Expenditure in 40 Years

Consumer spending surveys help set the base year for key macroeconomic data, including gross domestic product.

New Delhi: More than a month after National Statistical Commission (NSC) chairman Bimal Kumar Roy said the official survey report showing a dip in consumer spending for the first time in over four decades would be made public, the autonomous data body decided against releasing the report.

When asked why the NSC departed from its earlier view, Roy said: “I did try. I made a proposal (in an NSC meeting on January 15) to release the survey but I didn’t find support. I did put in the proposal as chairman but it didn’t get through. I cannot say anything more now.” A source said chief statistician Pravin Srivastava objected to the release of the survey data in the NSC meeting. However, one NSC member raised objections and pressed for the data to be made public. The person’s views weren’t incorporated in the minutes of the meeting circulated among the members, a person aware of the development said. “This raises eyebrows on the manner in which the discussions were conducted within the NSC,” the source said.

In the meeting, the National Statistical Office’s (NSO’s) survey design and research division gave a presentation, highlighting issues with the data and the reasons for a dip in consumer spending. The NSC, an apex body overseeing the country’s statistical system, has recommended conducting fresh back-to-back surveys on consumer spending in FY21 and FY22 with an improved methodology. The government last week set up an expert committee led by former chief statistician Pronab Sen to re-work the new survey on consumer expenditure, which is used to derive official estimates on poverty and inequality in India.

The Centre decided to junk the official survey of FY18, conducted by the NSO, after Business Standard reported in November that consumer spending fell 3.7% between FY12 and FY18. “Considering the analysis and views of members, it was agreed that the household consumer expenditure survey data are not sensitive enough to capture the significant changes in consumption behaviour, especially those goods and services delivered through social welfare programmes,” according to the minutes of the meeting, reviewed by Business Standard.

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According to experts, a decline in consumer spending implied that the poverty ratio in the country might have inched up for the first time in many decades. “It was recommended that the survey results may not be released in the present form nor used as a basis for base year revision of macro-economic indicators,” the NSC’s minutes further said.

Sen, who is heading the expert committee to rework the survey, said field work would face challenges due to the recent protests against the Citizenship Amendment Act, 2019, across the country. “We are going to have serious problems in conducting the survey from now on. There is a likelihood of a fair amount of non-response, which can actually contaminate the data quite badly,” Sen said.

The NSO has observed instances of attacks on its field officers, especially in states such as West Bengal, Kerala, and Uttar Pradesh, mainly due to a trust deficit. People fear that the survey officers are collecting data that can be used for determining their citizenship.

In the NSC’s meeting, it was decided to revise the basket of items used to map the consumption of households — to rationalise some food or non-food items and add new ones. The NSC also recommended capturing subsidies in a better manner, along with online services consumed by households. Further, the length of the questionnaire “may be optimised to around 45 minutes”, according to another decision taken by the NSC.

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This was the first time that the government has officially decided to not release a survey report after its completion.

Consumer spending surveys help set the base year for key macroeconomic data, including gross domestic product. The report, which was approved for release by a working group in June 2019, was withheld due to its “adverse findings”. Following the news report in November 2019, the statistics and programme implementation ministry issued a statement saying it had decided to scrap the survey because of “data quality” issues.

The government had not consulted the NSC before scrapping the report. Over 200 economists and academicians had written an open letter in November last year, demanding more autonomy for the country’s statistical system and an immediate release of the consumer spending data.

By arrangement with Business Standard.