The Government of India withheld the release of Consumer expenditure survey results of 2017-18. The leaked draft of the survey showed a decline in consumption expenditure in rural India.
As per the draft, consumer expenditure declined 8.8% in 2017-18 in rural India, but it increased 2% over six years in urban India. (It translates to an overall decline by 3.7 % to Rs.1446 in 2017-18.) (1)
What is the Consumer Expenditure Survey (CES)?
It is a survey intended to find out the Monthly Per Capita Consumer Expenditure of households in India.
The survey is conducted through household interviews using a random sample of households.
It collects information on consumer spending patterns across the country. The data reveals the average expenditure on goods (food and non-food) and services. (2)
This survey is conducted by the National Statistical Office (NSO), Ministry of Statistics and Programme Implementation. (NSO consists of NSSO and CSO. The survey is conducted by NSSO or National Sample Survey Office.)
It is conducted every 5 years. The last round was done from July 2011 to June 2012.
The leaked CES was done for the period of July 2017 to June 2018
Why was the survey data withheld from the public?
As per the media reports, it was withheld as the survey showed a decline in consumption expenditure.
But, the Ministry of Statistics and Programme Implementation issued a clarification on 15th November saying that the survey was not released due to data quality issues. Also, it said that the survey findings leaked by the media was still in the draft stage and cannot be taken as the final report.
The Ministry noted that:
- There was a significant divergence in consumer spending when compared to other administrative data sources.
- The survey could not capture the expenditure on social services like health and education properly.
Therefore, it decided not to release the data.
Instead, it is examining the possibility of conducting the next Consumer Expenditure Survey in 2020-2021 and 2021-22 after incorporating all recommendations submitted by a committee of experts to rectify the data quality issues.
But, economists have questioned the government’s argument on ‘data quality’. They have pointed to other indicators including data from the NSSO’s Periodic Labour Force Survey (PLFS) that clearly revealed a decline in employment and stagnation in wage levels. (3)
Some economists have reiterated the Ministry’s stance.
A decline in consumption expenditure should correspond to an increase in poverty levels in 2017. Nearly every other indicator shows India’s poverty to be in single digits and very close to 5 per cent in 2018.
Also, a gap has grown for decades between consumption as reported by GDP data and NSSO surveys. (The gap increased from 20 per cent in 1980s to 45 per cent in 2009-10). It should also be noted that the GDP during 2017-18 had grown at 7 % and consumption was the main driver of growth.
The comparison of NSSO’s consumption expenditure on healthcare and education with focussed surveys of NSSO on social expenditure including healthcare and education also reveals a discrepancy. (3)
All said and done, even if there might be data quality issues in the survey, the Government has stirred a needless controversy. It has given out an impression that it is fudging data to project a more rosy picture of the economy.
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