S. Africa Data Credibity at Risk From Budget Cuts, Council Says
S. Africa Data Credibity at Risk From Budget Cuts, Council Says
South Africa’s cash-strapped statistics agency requires 200 million rand ($13.3 million) to continue publishing accurate economic indicators, according to the South African Statistics Council.
Statistics South Africa has reached a crisis point, having exhausted all efficiencies since the government cut its budget by 160 million rand in 2015 and imposed a hiring freeze, said David Everatt, the chairman of the South African Statistics Council, a panel that advises the government and statistician-general on issues affecting national data.
The agency is cutting the sample size of surveys, which will lead to a widening of error ranges over time, and dropping indicators deemed too expensive, such as its self-reported poverty survey, he said. It’s also battling a vacancy rate of almost 20%, Everatt, who is also the head of University of the Witwatersrand’s School of Governance in Johannesburg, said in an emailed statement.
“If Stats SA cannot produce accurate official statistics, ratings agencies will punish South Africa, international investors will turn elsewhere, domestic business will lack reliable planning data and a downward spiral will be inevitable,” he said.
The government’s ability to fund Statistics South Africa and other state agencies is constrained by below-target revenue and on-going bailouts for loss-making state-owned companies, including Eskom Holdings SOC Ltd and South African Airways, whose finances have been hit by years of mismanagement and accusations of graft known locally as “state capture.”
The statistics agency isn’t alone is requesting more funding. Edward Kieswetter, the commissioner of the South African Revenue Service, said in October the tax agency needs more money to do its work properly. SARS, which employs about 12,500 people, had around 1,000 vacancies at the time.
“Stats SA is not a ‘state capture’ bail-out candidate: the entity receives regular clean audits, and enjoys widespread public trust,” Everatt said. “It is very difficult to understand why a respected, reliable and important institution, that plays by the rules and is praised by the Auditor-General, is in effect punished by government while those deeply implicated in state capture receive bail-outs of massive proportions.”
Once-off emergency funds, including 46 million rand that’s due this year, aren’t enough to stop a decline at the institution, he said. The agency is due to publish an updated census in 2021.
To contact the reporter on this story: Prinesha Naidoo in Johannesburg at pnaidoo7@bloomberg.net
To contact the editors responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net, Gordon Bell
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