Statistics South Africa Budget & Programmes: briefing

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Finance Standing Committee

09 May 2002
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FINANCE PORTFOLIO COMMITTEE, FINANCE SELECT COMMITTEE: JOINT SITTING
10 May 2002
STATISTICS SOUTH AFRICA BUDGET & PROGRAMMES: BRIEFING

Co-Chairpersons: Ms Hogan (ANC), Ms Mahlangu (ANC)

Relevant Documents:
PowerPoint Presentation by Statistics South Africa

SUMMARY
The main focus of the briefing of Statistics South Africa and the discussion of the committee was the National Statistics System. Members were concerned that if government and Statistics South Africa worked together in partnership there could be a conflict of interest. The briefing also looked at what Stats SA had done in the past year and informed the committee on the progress of Census 2001.

MINUTES
Statistics South Africa was represented by Mr Pali J Lehola, Statistician General, Prof. Akiiki Kahimbaara, Chief Director: National Statistics System and Dr Herschowitz. The Minister of Finance, Trevor Manuel and the Deputy Minister of Finance, Mandisi Mphalwa, represented National Treasury.

Briefing by the Statistician General (SG)
The SG outlined the key strategic objectives as follows:

- Implementing the National Statistics System (NSS)
- Strengthening the organizational capacity
- Improving communication through regular publications
- Compliance with the Special Data determination Standards (SDDS), the PFMA and the Council
- Improving the quality of the information

The deliverables of the NSS are firstly the developmental indicators that must be authoritative. Secondly, the Management system for statistical information that must make the data accessible. Thirdly the associated databases must be comprehensive and lastly, capacity building to ensure that information is produced and used.

The aim of the NSS is the production of authoritative statistics for South Africa. The NSS must define the criteria for declaring statistics as official, it involves government departments, parastatals and the private sector working together and it must promote definitions, standards and classifications.

The way forward sees the NSS creating a statistical master plan, creating indicators for cluster priorities and promoting the use of statistics as the basis for policy.

The SG went through the progress on social statistics, economic statistics, population statistics, GIS, capacity building and compliance. This overview is contained in tables in the briefing document.

After the briefing a short snippet was shown illustrating the work of Stats SA in contributing to the upliftment of the disabled - called the Disability Partnership Project. The project looks at how to use people with disabilities in the census, how to approach households where there might be a disabled person and ultimately how to successfully employ disabled people. Training of the disabled is funded through the National Skills Development Fund. Currently there are 80 disabled persons working at Stats SA head office. The problem is that the employment is merely short term. An encouraging sign is that many of them will be going for interviews for other employment.

The Minister of Finance, Mr Trevor Manuel, said that the briefing looked at four areas:
- outputs
- organisational challenges
- communication / publications
- compliance

The big issue is that that there must be information of quality and information that can be trusted. Stats SA must be the authoritative voice. The important challenge therefore is to get the quality correct and have the outputs trusted.

The 1996 census results were released in 1998 and currently Stats SA is in the position to release the 2001 results within 18 months and this is better than most OECD countries.

He commented that it is not possible to build a department as important as Stats SA if there are no universities that offer appropriate courses. If a good quality system is wanted then appropriately qualified people are important. He said that this gap in tertiary education must be filled otherwise there will be problems in the future.

Discussion
Mr Moloto (ANC) noted that in the media there were serious concerns in the past about the quality of Stats SA information and wanted to know what are being taken to address this.

The SG replied that one of the issues raised in the press is whether the GDP figure is correct. Another is whether the unemployment figures are correct. The accuracy of the 1996 census was questioned and advertising agencies then used their own figures because they felt these were better. Local government had said that there would be a serious problem if the population figures come in lower than they expected. The Western Cape had originally claimed that the Stats SA lowered figures for that province had robbed them of R1.6 billion of the equitable share but the Western Cape later conceded that the Stats SA figure was correct.

Dr Herschowitz commenting on the steps taken to correct the situation said that methodology and integration units have been put in place. This will influence the quality of the information. Stats SA also received assistance from the Swedish Stats agency in respect of quality management. There are pilot projects that implemented the master sample approach for the labour force survey. She explained that the master sample was a way of ensuring that the statistics are more accurate over time. The master sample method draws a sub set from an enumerated area. It is updated continually.

Ms Taljaard (DP) understood the need for the National Statistics System but was concerned about the partnership between Stats SA and other government departments. She asked what would happen if there was a dispute about the definition of unemployment for example and how could one be assured that Stats SA would have the final say as to what the definition is. It was after all the responsibility of Stats SA.

The Deputy Minister of Finance, Mr Mphalwa, replied that one of the processes that needs to be established is a system that enables the tracking of an individual from birth to death. At all the stages through the individual's life, inputs will be required from different sources. There are weaknesses that exist but "we must get to a point that we will be able to say that the statistics are credible".

The SG added that the stats environment needs critics for it to grow. The active promoting of classifications and standards ensures that conflict between Stats SA and the departments will be resolved in a neutral manner. Stats SA has a statutory mandate and is kept in line by the well informed media, academia and international standards and definitions.

Ms Hogan said that the police had stats on crime but could not release these because of a faulty process. Since the Minister has said that Stats SA must be the authoritative agency but departments also release statistics, conflict seems inevitable. She asked if it was the intention of the NSS to promote the debate within government as to who is responsible for what statistic and debate around the methodologies that are appropriate.

Ms Taljaard added that Stats SA should not be a super regulator as this is not their legislative mandate. She added that there were inferences that the Statistics Council would resolve disputes and questioned whether it had the legislative power to do so.

The SG replied that the Council has the responsibility of advising him and the Minister but has no power to decide who is right.

Prof. Kahimbaara answering the question said that the change is going through three stages. We are moving from a point where everyone was doing there own thing to a partnership and finally to a system. The NSS is needed because Stats SA cannot satisfy all users. More producers are needed but official statistics are only from Stats SA - the rest are called 'other' statistics.

Another important point is what Stats SA produces and what other departments produce do not match. The partnership requires all to get together, talk to the users, link up with the suppliers and come up with a system that benefits all. The partnership will be transformed into the new system.
The users will get the information that they want, producers will share the budget and produce stats efficiently. No unneeded stats would be produced. Each department will produce stats that they are best suited to produce. It is difficult for Stats SA to produce stats on health for example. All this is done by agreeing that there are accepted definitions, standards and methodologies.

The professor submitted that once the same standard and definitions are used then there should not be any problems.

Ms Taljaard was of the opinion that the situation where there is no agreement as to the definition has not been sufficiently looked at. She still had some unease about potential conflict situations and how they would be resolved.

The Deputy Minister replied that the partnership must work towards a point where there is certainty that the statistics are based on a certain standard.

Ms Hogan said that question is whose opinion prevails where there is a conflict. One assumes that Stats SA must prevail because they set the standard. Stats SA must be able to say that it is not an official statistic.

Dr Herschowitz said that other departments stats are mainly register type. The birth register is poor and only gets better after school-going age. Stats SA through newsletters has been able to get births registered at the clinics instead of going to Home Affairs. This was an example of how Stats SA helps departments improve their information.

Ms Hogan had no doubt that that the National Statistics System is vital for planning but said that the committee will have to be kept informed on the progress.

Ms Mahlangu commented that COSATU often critisises the definition used by Stats SA for unemployment. She asked if there were discussions with labour in this regard and what the trend was in other countries.

Dr Herschowitz replied that there is an official and an expanded definition of unemployment. Countries are given the discretion to use either definition depending on the circumstances. She was of the opinion that both definitions were valid in South Africa and therefore Stats SA used both of them. The issue was recently discussed with Cosatu and Stats SA is awaiting their report. She again added that both definitions need to be used but a better analysis is needed of the difference between the two.

Ms Joemat (ANC) said that there is suspicion within communities to give the correct information and asked what Stats SA can do to market themselves in the community.

The SG replied that one of the measures is that the census is published in the 11 official languages. Stats SA also has interesting ideas on how to go into schools, universities and public meetings. It was just a question of getting the structures in place. He emphasized that the printe form was still important in marketing oneself. He added that during the campaign the T-shirts and caps was very visible and became well known. This was another way of promoting the results.

Ms Taljaard questioned the accuracy of the mortality statistics. She asked what steps were taken to prioritise the economic data and if there was any specific emphasis on youth unemployment in the labour force survey.

Dr Herschowitz replied that the main concern is to improve the business frame and draw accurate samples. The register is being updated and business is being re classified. Surveys are planned for new industries such as communications and electronics and Stats SA is looking at how businesses change. The developments are aimed at ensuring that the economic data is more accurate.

Ms Hogan commented that the relationship between the Reserve Bank and Stats SA is not clear.

Dr Herschowitz replied the bank calculates GDP in terms of consumption and Stats SA calculates it in terms of income and production. Stats SA also provides the Bank with information for them to do calculations. There is a member of the Reserve Bank on the Stats Council.

The Minister added that an anomaly exists because there should be only one official statistician South Africa is unique in that the Reserve Bank calculates the expenditure GDP which is not part of their core competence and has little to do with monetary policy. He said that this must be resolved. In terms of legislation it was the responsibility of Stats SA.

Dr Herschowitz, responding to Ms Taljaard's other questions, said that the death certificate is getting more accurate and should get better. It has been modified by Stats SA and the Health department to ask for the primary and secondary causes of death. The World Health Organisation's classification of deaths is being used. The exact number of people killed by AIDS will not be known but the minimum band, medium band and maximum numbers will be able to be provided due to this.

In respect of youth unemployment, she said that data is collected on all people between 15 - 65. A report has been issued on youth but there is no separate analysis.

Ms Nqodi (ANC) asked what makes a statistic 'official'.

Prof. Kahimbaara replied that it has to be gazetted. For the statistic to be gazetted a number of criteria has to be met. Two of which is that it must be in the public domain and it must be sustainable. That is, the statistic cannot be for only one year, it must be relevant for some time.

Ms Hogan concluded by saying that the Public Finance Management Act calls for output based budgeting. She asked Stats SA to ask themselves what indicators they would use to measure themselves. The committee needs to know these performance indicators to monitor the progress of Stats SA.

The meeting was adjourned.

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