Statistics SA: Minister's Budget Speech


19 Apr 2010






20 APRIL 2010



Honourable Members

Ladies & Gentlemen


Today Parliament debates the vote of Statistics South Africa as a stand-alone vote for the first time since the establishment of democracy in South Africa. For the past 16 years, this debate has been part of another – initially, it was part of the RDP Vote and since 1997, it has been incorporated into the issues raised by the Minister of Finance. Hence, parliament has not had the opportunity to give due attention to the oversight of Statistics SA, with attendant consequences. The fact that this debate is a first, is a cause for celebration. Our celebrations though will have to be virtual – the tight fiscal constraint and the immensity of the Stats SA workload, leave us no other option.


In the context of the ash cloud generated by volcano Eyjafjallajokuli, in Iceland, flying and flight safety are exceedingly popular topics.  How much information does a pilot need about the environment that he/she is flying into, and more importantly about the response of the aircraft that they are flying. Who generates the information? And what are the consequences of such information – altitude, speed, wind, direction etc being incorrect? Who checks that the instrument gauges are accurately calibrated? In truth, the work of a statistics agency is no different to that of the avionics engineers who provide pilots with certainty. The client base is different – not pilots, but policy makers and not aviation safety authorities, but parliament. And the information must inform decisions – primarily about the economy and people’s lives. What is consistent is that the information must be readily available, it must be usable and it must be trusted. The opportunity presented by this debate is, in many respects, the start of Parliament’s engagement with the statistical outputs in order that parliament will know that these  outputs meet the quality standards because this, then becomes the heart of oversight., not merely of Statistics SA, but of every government function and about the efficacy of policies.


Official statistics are used to:

  • inform parliaments and political assemblies about the state of the nation and provide a window on the work and performance of governments. This allows them to assess the impact of their policies over time and between different areas
  • provide ministers with a picture of the economy and society, enabling them to formulate economic and social policies and to monitor and evaluate their delivery
  • permit government and its agencies, at all levels, to carry out their business efficiently and effectively and make informed decisions based on evidence
  • provide citizens with a view of society and of the work and performance of government. Statistics show the scale of government activity in every area of public policy, allowing the impact of government policies and actions to be assessed
  • furnish businesses with a statistical service that promotes the effective and efficient functioning of industry and commerce
  • assist analysts, researchers, scholars and students with their work and studies


Chairperson, it is important that we acknowledge the challenge of attitude faced by Stats SA in the process of compiling the data. The enemy being faced is that of the cavalier behaviour frequently both of persons surveyed and public servants who are tasked with providing correct and current information If people tell untruths in response to questions about their circumstances, Stats SA will generate statistical series that are quite unreliable.  And then, there are public servants who provide incorrect information – either as a consequence of omission or commission.  I want to invite parliament to assist in remedying this unhealthy situation. First, we must all work together to ensure that all citizens appreciate that each of us has a civic duty, which includes providing accurate information when requested. This becomes a task for all organs in society – elected representatives in all spheres, religious leaders, trade unions and educational institutions together. If we cannot measure either what has been done, or what remains to be done, we cannot allocate resources or plan improvements.  If the appeal to civic duty fails to yield responses, we will have to explore the means of compulsion together.


As part of its mandate, Statistics South Africa has to collect information from both households and businesses.  Often it has to ask about similar issues and compiles a view on the same issue from a perspective of business and another view from the perspective of households.  An example of this is the measurement of the labour market measuring  both the number of jobs in the form of the QES and the level of employment in the form of the QLFS.  These are two closely related concepts that are measured using two different sets of instruments and directed to two different audiences.  The measurement of jobs is directed to businesses and asks about the number of persons they employ or number of job opportunities that exist and are occupied.  To measure employment levels, data is gathered directly through household surveys. This information gives an indication not only of the number of employed persons as in the QES but also the rate of unemployment. What should become clear is that the different surveys must correlate with other information.


An area that will improve the compilation of our economic statistics and enhance better service delivery is the business registration reform.  In committing to speed up the country’s economic growth and transform the economy to create decent work and sustainable livelihoods, President Zuma identified in his State of the Nation address on 3 June 2009, the reform of the business registration system as a key priority when he said:

“In another intervention to create an enabling environment, government will move towards a single integrated business registration system. This will improve customer service and reduce the cost of doing business in South Africa.”

Stats SA, SARS and the DTI have set up a joint project that will work together to achieve this government object. The first appointments to the project team were made at the beginning of this financial year. This project will not succeed without the fullest collaboration of all the government partners including Cipro which must maintain a current and reliable business register.

While it is estimated that the project will take 3 years, Parliament will have to monitor the delivery by the political and administrative heads of these institutions  to ensure that targets are met.


To get a measure of both quantitative and qualitative public services, government and Parliament alike need dependable statistics. We know what funds were allocated. Parliament votes these funds in the Appropriation Act. The independent audit system provides information about the general utilisation of those financial resources. But we do not know enough about how the funds are disbursed nor do we have an adequate measure of the actual services that the financial resources pay for. We require sound administrative record-based sources for the data to form the national statistics system. This system should begin provide a complete picture of government delivery and in the process identify gaps. If the Education statistics point to a low percentage of matriculants with maths and science subjects, government may want to consider providing incentives for specialised training of teachers in these subjects. Colleges may need to consider providing bridging courses. If the statistics from a specific health clinic points to a preponderance of a particular disease, we may want to investigate the environmental factors that cause this predisposition.

But if we want this, then every cost centre in the course of its work must generate the data that will inform an information management system within the function. This information also becomes important for a statistical system that informs evidence based policy making to drive future change.


This brings me back to the point made earlier with regard to the role of public servants and provision of accurate information. The responsibility for accurate administrative records should not only be a civic duty but should be linked to performance measurement of officials. We must accept that in some cases there are challenges in this regard in terms of the administrative burden placed on some already overworked service providers. At the same time, however, we must also acknowledge that public servants need to understand that it is imperative that accurate information is provided. Stats SA is only able to compile an accurate reflection of services if the data provided to them is accurate. Once again we appeal to the members of Parliament to take this matter seriously when performing oversight and holding government to account.


It is important that Parliament and the public begin to understand the strategic role of statistics and importance of evidence based decision making. In terms of the Statistics Act, the role of the Minister is limited to determining what is measured.  How it is measured is left to the Statistician-General and his team. The role of the Statistics Council is to provide us, the public and Parliament with the assurance  that the methods are scientific and comply with national and international standards such as the United Nations Fundamental Principles for Official Statistics, the Special Data Dissemination Standards (SDDS) and eight dimensions of quality specified in SASQAF. 


The Consumer Price Index is an exceeding important measure of both wellbeing and change. It is also the most widely used of the statistics series. It is used by the Monetary Policy Committee of the Reserve Bank in their setting of the repurchase ‘repo’ rate, a key determinant of interest rates. It is also used as a key measure in wage bargaining. It is therefore essential that the CPI approximates as closely as possible the impact of price changes on the living standards of families. It is for this reason that the CPI was quite significantly retooled a few years ago. Amongst the changes introduced there was a change to the basket of goods measured. There was also a simultaneous change to the weights of the various goods and services in the basket. To compile this, the Income and Expenditure Survey was changed by asking 30 000 families to record an income and expenditure diary over a period of a month. Once the baseline was changed, the updates are now captured in a modern form. This innovation puts our CPI on par with the best in the world. It is envisaged that the task of retooling is expected to be done more frequently at intervals of three years as products in the basket change and as persons experience greater social and geographic mobility. Then a more intricate process of calculation of products by amount spent and the number of people consuming the products generates the basis for a CPI base.  Against this base, prices on selected goods are collected monthly from outlets and price changes are recorded to calculate a monthly CPI figure.

The related price index is the Producer Price Index (PPI) which to date is not as robust as the CPI in its product coverage.  In Australia, a PPI is a lead indicator to the extent that it acts as a harbinger for indicators downstream. The PPI in South Africa is in the process of being retooled so that we can begin to see the linkages with the CPI more clearly.


Another product to be presented before Cabinet and Parliament soon, is the Poverty Line.  The measurement is designed to produce statistical information on poverty and inequality (from a multi-dimensional perspective) at regular intervals. Again, relevant, good quality data is a key element of the integrated Anti-Poverty and Inequality framework.

The poverty line is an analytical tool using multiple sources of information such as the consumption expenditure basket, the Income and Expenditure Survey, information from dietary protocols provided by the Medical Research Council. This provides an indication of a food line across the different income brackets which is then used to determine a representative food basket is calculated and a per capita food requirement. Basic requirements like clothing and shelter are added to provide a poverty line.  It is envisaged that the line will be updated annually  by consumer price index. 


Having noted the strategic importance of statistics earlier, it is therefore vitally important that the communicators of the information being produced by Stats SA similarly understand this. In this regard, Stats SA has embarked on a programme to introduce the media not only to how the data is compiled but also what the import of the information is. This has started with a series of workshops with journalists this year, the first of which was held in Cape Town. Accurate reporting is essential is we are to convince the public of their civic duty to provide information accurately and honestly. Inaccurate reporting not only damages the public confidence in the products of Stats SA but also affects the attitudes of those providing the information. New communication strategies are being formulated and implemented, the first of which will be the “FieldWorker” a monthly publication that Stats SA plans to issue to participating households. This newsletter will also be electronically available so that the general public is able to access it as well.


Having addressed some of the key outputs being produced by Stats SA, this debate must touch on the forthcoming 2011 Population Census.  This will be the third Census that South Africa conducts since we earned democracy and the census has become the basis of our national statistics system. 


The census constitutes the biggest peacetime mobilisation of the population. In October 2011, that is in the same year, 120 000 people will be canvassing information from 13 million dwellings across the country.   They will be asking the residents of the households for information about their ages, gender, levels of education, employment, languages, access to services; among other things.


It is important that we recognise that there are lessons that were learnt from the manner in which the previous Censuses were conducted. The training provided to the census takers must be sensitive to the challenges that they will face in the communities. Equally an understanding of the communities that they will be interacting with is crucial.  The methods used to collect information and interact with households must improve. In the previous censuses we unfortunately had a high undercount of 10% in 1996 and 17% in 2001. While an undercount is inevitable, strategies must be put in place to keep it at a minimum. Stats SA must commit to bringing the undercount to within a range of 2 %. It is a difficult task. In parts of South Africa, people live in gated communities. In other parts of South Africa collections in informal settlements become difficult. There are people that benefit from services in more than one locality and don’t want government to know about this; there are people who are in South Africa illegally and seek to live twilight lives out of view of the state; there are situations on farms where families have been evicted but been replaced by illegal workers from elsewhere – all these people would try and mislead in filling out their questionnaires. Unlike Parliament, they have no interest in a reliable outcome to the census. It is factors such as these that produce an undercount. It is a difficult task but complexity should be no excuse. I’ve dealt with one of the key strategies earlier, that of ensuring that every South African understands their civic responsibility of providing accurate information.


Before embarking on the census process, an awareness process will be launched. This awareness campaign will target the various sectors of the community, which includes the high walled and fenced-in communities, the low income commuting community, the farming communities and shack settlement dwellers. One of these focused strategies will be a universal census at schools which will be aimed at creating awareness with parents through their school-going children.


We recognise that the quality of the statistics being produced relies on having a competent qualified cadre of officials. Statistics South Africa has developed extensive capacity building programmes to address the skills shortage in the organisation.  Through their work with the Institute for Official Statistics, Stats SA is looking at strategies to address the shortage of statisticians in the long term. As short term measures,  Stats SA has embarked on a number of special programmes such as Maths 4 Stats, which is intended to assist teachers in respect of statistical learning outcomes. It has instituted intake programmes which includes the internship and learnership programmes. In addition, officials are given the opportunity to participate in a bursary scheme and other training programmes, including training programmes for leadership development for various levels of management.


Honourable Chairperson, South Africa has filed a flight plan, to improve on the quality of life of all its citizens. We should agree that whilst significant progress has been made, we are not approaching our destination nearly fast enough and that the fuel for this journey – financial resources and a competent public service are not being efficiently used. Our instrument gauge in the cockpit must tell us all of these things. Stats SA runs the avionics to calibrate the gauges on the instrument panels. If we want improvement, we must read those gauges and know that their reliability is never in question. This is hard work, mostly behind-the scenes work and always thankless work.  I want to change the last of this by expressing our appreciation to the Statistician General, Mr Pali Lehohla and his competent who need the confidence of this parliament to do what they must. I also want to thank the Statistics Council, led so ably and diligently by Mr Howard Gabriels. And then, I wish to thank members of the Portfolio Committee on Finance for the many hours of oversight and engagement which Stats SA will have from you. An enhanced collaboration and a keener oversight will deliver a better quality of democracy.  


I thank you.


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