Council's Attitude To Statistics

By Bevan Greenslade

There is a hum of institutional and political backgrounds, and inside information, filtering through the reports of the Monetary and Economic Council.

The Fifth and Sixth Reports of this Council continue the growing tradition of informed and expert comment upon facets of New Zealand's economic life.

The Council has two aims—promotion of economic growth and rising standards—and two constraints—maintenance of full employment and maximum stability of internal price level. The reports are nearly always clear, but in some matters inconsistent and occasionally there is use of ambiguous economic jargon which is in sufficiently defined.

There is a feeling that there are close contacts with private opinion from official sources. Perhaps the most apparent example of this occurs in the Sixth Report where some information regarding increased bank debits is given the source "We have been advised". Could this adviser be Mr. Jim Rowe, once a Lecturer in Victoria University's Economic Faculty, now Research Director of the Trading Hanks' Association? If so we can only feel grateful that such unofficial sources are being able to find their way to a wider public.

A less commendable political attitude seems to be in evidence in the Fifth Report. The Council appears not to question the Department of Statistics' allowing the layman to use a figure as "exact". The average layman accepts figures as being exact but in fact statistics are rarely accurate in this sense. The Council knows this and knows also that in order for the layman to know the degree of "fuzziness" of these figures information of their sources and methods should be obtainable. However the Council did not come out and say so nor did they recommend that a "sources and methods manual should be published.

The oversight or omission to do so can be explained in terms of the Council's dependence upon Government support for its existence and in terms of the institutional and commercial bias of the Council members. But such reasons do not deserve either our approval or our forgiveness.

The Fifth Report is well balanced and the ways to carry out its suggestions are fully discussed, weighed and selected. In the third part the Council has named the chosen areas for immediate investigation and improvement; national income and expenditure and balance of payments estimates, both annual and quarterly; retail trade turnover; building and other investment activity; quarterly index of industrial production; import license usage; actual activity; actual wage rales and earnings, hours of overtime and short-time work; and finally, household enquiries.

If all these improvements are accepted by the Government, might not the money be better spent in making currently-produced statistics clearer and more up to date and publishing a "sources and methods" manual as some overseas countries already do? (for example U.S.A.. Canada, U.K.. Australia). Measures of relevant standard errors, of estimation sample size, correlation coefficients, etc., should be available somewhere. These measures are not an optional "luxury".