The credibility of the country’s statistical system has been put at stake as Finance Minister Dr Abdul Hafeez Shaikh has pressed Pakistan Bureau of Statistics (PBS) to “review this year’s provisional growth figure of 3.2%”, which remains below the revised target.
The pressure comes within 24 hours of the release of growth figure, which was approved by the National Accounts Committee (NAC) on Thursday. Now only the NAC has authority to revise its approved figure, that too after receiving final growth data from all sectors.
Addressing a press conference on Friday, Statistics Secretary Sohail Ahmad said “the NAC has overlooked some aspects while approving the gross domestic product (GDP) figure and it will be tabled before the governing council of PBS for review.”
The governing council is headed by none other than Finance Minister Abdul Hafeez Shaikh.
Ahmad’s statement was contrary to what he said on Thursday when he announced that the GDP growth had been computed with utmost care. He also said a new base year of 2005-06 for calculating GDP had been adopted in consultation with all stakeholders, which is in line with international best practices. Earlier, the base for calculating national accounts was 1999-00.
It will probably be for the first time that the finance minister will decide the growth figure of his tenure. In the past, there have been instances where finance ministers tried to influence the work of NAC but they never presided over its meetings or reviewed its work.
Ahmad denied any pressure from the finance minister to review the GDP data as the government failed to achieve even the revised target of 4%. The original target was 4.2%, which the finance minister believed would be achieved and had given assurance to the prime minister, the IMF and other international lending agencies in this regard.
When asked why the finance minister claimed to have achieved 4% growth, Ahmad said he based this on last year’s growth of 2.4%, which was later revised upwards to 3%, affecting this year’s growth due to a high base effect.
Hafeez Shaikh was not available for comments. “The NAC is the final authority to revise the GDP growth figure. If the PBS governing council decides to review it, it will be deemed illegal,” agreed a finance ministry official.
Ahmad said the meeting of the governing council would be called next week to review the GDP figure. “A review will be done to assess the performance of the financial sector that saw an 11% contraction. It (council) has the authority to question the work of NAC and finally tell the government whether the work is sustainable,” he added. The council will also review the rebasing of national accounts.
“This is our final provisional figure and the governing council will find nothing wrong in it,” said Arif Cheema, Director General of PBS. He said the PBS would defend its number in the meeting.
He said the data calculation methodology was in line with international standards and this would be defended. Any change in the methodology would adversely affect this year’s per capita income by Rs96 billion, but when this amount would be distributed among 178.9 million people the impact would be insignificant, he pointed out.
Published in The Express Tribune, April 28th, 2012.