Updated Household Income and Expenditure Survey is only way to gauge ‘poverty reduction’ and ‘inclusive growth’
Please allow me to make some comments on your Business Page of January 5.
Mr Lucas says that Guyanese, especially the opposition, ought to be mindful of the fact that the Government of Guyana is unlikely to change economic course on account of its “success” in registering growth. He asks whether Guyanese might by default, by ignorance of the changes and requirements over the last 25 years, be acting contrary to their own interests. He cites, as a reason for Guyanese to go with the programme so to speak, the IMF Executive Board: “Directors encouraged the authorities to persevere with their commitment to sound policies and reforms to strengthen policy buffers, promote more inclusive growth, and further reduce poverty.”
Well, I always assumed that such articles are for the entire reading public not all of whom are economists. So how are we to know whether to follow a programme or a set of programmes at a given time, or a series of programmes over 25 years? Well, if a reader considers himself a beneficiary of the programme or programmes that is a good indicator for him. If he is not a beneficiary then a reasonable person might ask, ‘Do I see my neighbour benefiting?’ If not, who is? Here is where we come to a serious problem with the analysis.
Is BP aware that there is an instrument by which a reasonable person who is not an economist can know how these programmes on ‘poverty reduction’ and ‘inclusive growth’ are doing? Does he know that this instrument was published in Guyana and has stopped being published? I am talking about the HIES (The Household Income and Expenditure Survey). The last one I saw was about 1993. Why was it stopped? This survey was conducted throughout Guyana and showed which households in which geographical areas were receiving what income and from which sources. I want to suggest that without such an instrument which is understandable to an ordinary person it is unreasonable to ask anyone to follow any programme. When I get into an aeroplane I don’t have a clue how to operate the controls or the geography as viewed from the air. In fact I can’t sometimes even see anything. However, when I come out of the airport I will expect to see if I have landed where I planned to go. The HIES is the only instrument I know that tells me not only how I am supposed to be doing as part of a group, but how others are doing independent of any political propaganda. So when is BP going to advocate the return of that instrument?
On checking to ensure that I have not missed a recent publication of the survey I found this curious entry on the UNDP website: “The Household Income and Expenditure Survey and Guyana Living Conditions Survey, each show that the proportion of households living in moderate poverty (on US$2 daily) has declined from 43% to 36.3% in seven years.” This would appear to suggest that there is an up-to-date survey. Is it a state secret? And why? If there is indeed an up-to-date survey apparently the writer of the Guyana Times article which I also found on the net titled ‘A lack of planning’ dated May 23, 2013 does not know (assuming that the UNDP site is not referring to a report published between then and now). He or she quotes from a book by John Gafar referring to the 1993 survey without reference to more up-to-date figures.
About that growth, how does BP know how much of that growth has resulted from statistical tweaking? Argentina has been threatened with suspension by the IMF for that. Argentine President Kirchner fired statisticians in 2007 for not tweaking. His wife who is the current president fired a woman who made public her observations on the difference between the stats she was seeing in her department and the stats published by the government. Do you think that if any tweaking should happen in the Guyana Bureau of Statistics we would have someone speak about it? I doubt it. Here is what the law says: “Bureau of Statistics Confidentiality of the reported data from individual units is guaranteed under the Statistics Act, Paragraph 11. Furthermore, a breach of confidentiality by an employee is regarded as a major offence subject to conviction and penalty under Paragraph 12. Finally, Section 16 (1) of the Statistics Act requires all employees to take an Oath of Affirmation to safeguard all information to which they become privy in the course of their duties (from IMF website on Guyana’s statistical system).
Lastly, everywhere where there is accountable economic management, one sees the role played by the rate of unemployment. Does BP know what the rate of unemployment is in Guyana? Could you imagine a country where even the Ministry of Labour is reported as not knowing the level of unemployment? BP says that as part of the economic programmes there was a “drastic reduction in the workforce of the public sector and an increased use of contract workers.” Wait a minute. Who is checking on what happened to these workers over the years? Are the numbers reducing or swelling? Are the ones who can’t get a job or are among the working poor to get behind the programme too?
One suspects that BP has provided the answer, wittingly or unwittingly, to the question he poses in the “40% of the economy distorted by money laundering” quote. Seems like a lot of Guyanese have indeed responded to these programmes, though not all of them in legal ways.