The information that Statistics South Africa compiles is the primary window through which the health of our economy can be viewed. That information feeds into decisions that affect every South African, be it the Monetary Policy Committee discussing our interest rates, a nervous hedge fund investor determining whether she wants to buy the government's bonds or a CEO of a company trying to gauge whether his company can afford to stay in business.
It is critical that that window stays polished and clear at all times. Yesterday, Statistics South Africa reported that the unemployment rate in South Africa had decreased by 1.3 % between the third and fourth quarters of 2008. The data has been slammed by economists as "being closer to fiction than reality".
At the next Parliament, the Democratic Alliance (DA) will call for the Statistician-General to outline a clear strategy on how he will act to improve the reliability of the information he is responsible for releasing. This issue will be raised as a matter of urgency as the millions of workers threatened with job losses cannot afford continued confusion about the state of our economy.
Data released in the past two weeks points to a significant contraction in the economy and paints a stark contradiction to yesterday's employment figures. Our Gross Domestic Product shrank by 1.8% in the fourth quarter of 2008, driven primarily by a 21.8 % decline in manufacturing which accounts for 14% of formal employment. Data released on Friday shows that our current account deficit had swelled to R17.4 billion due to a 25% collapse in exports from labour intensive mining and manufacturing sectors. The data released yesterday is based on a sample collected in 2001 and is only intended to be revised in 2011.
At this time of economic turmoil in which investment decision makers are avoiding risk at all costs, unclear and contradictory messages about the state of our economy are compounding the impact of the global financial crisis. How can the government implement plans to deal with the fallout from the meltdown if it cannot reliably determine which people have lost their jobs and which companies have gone bankrupt? How can it aim to attract investors to pay for its infrastructure investment programme if that investor can't get a clear picture on our economy?
Stats SA has a long history of releasing unreliable information. Last year, the DA called for the Statistician-General to appear before Parliament to explain the re-weighting of our Consumer Price Index basket and the reliability of the Producer Price Index. The ANC government must justify how it can continue to endorse the inefficiencies in this institution which is so vital in shaping our government's most important policy decisions.
Statement issued by Kobus Marais, MP, Democratic Alliance spokesperson on Finance, March 3 2009
