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Statistical renovation

(China Daily)
Updated: 2010-12-27 07:58

The top statistics official's pledge to steadily reform the method of calculating the country's house sale prices in 2011 is welcome. It marked a belated recognition of the absurdity of defending statistical results that obviously fly in the face of economic reality.

However, to provide information that makes sense to both the public and Chinese policymakers, statistics officials must be even bolder in overhauling the statistical system to accurately reflect the country's ongoing transformation towards a consumer society.

Otherwise, efforts to correct problems in the calculation of house prices will only amount to tinkering at the edges of an outdated system that is increasingly out of touch with real life.

Ma Jiantang, head of the National Bureau of Statistics (NBS), said on Thursday that the country will carry out a new house sale price statistics scheme in 2011 after soliciting opinions via the Internet since earlier this year.

The remarks contrast sharply with responses from some officials after the public strongly doubted the ridiculously low official growth figure of house prices at the beginning of this year.

According to data then released by the NBS, house prices in China's 70 major cities increased by only 1.5 percent year-on-year in 2009. Such a negligible hike, not only made urban residents - who saw house prices almost double within a few months in their cities - angry, it also frustrated the central government which had to cool the property market.

In previous years, statisticians have shrugged off similar problems as a perception gap between professional statisticians and ordinary people. But the 1.5-percent hike in house prices in 2009 was so counterintuitive and controversial that the officials had to admit technical flaws in their number crunching. Almost a year later, they are finally taking steps to fix some apparent loopholes in their work.

Improved statistics about house prices highlight the lack of significant progress in perfecting the composition and calculation of the country's consumer price index (CPI), a key gauge of inflation.

On one hand, more than three decades of robust economic growth has considerably boosted Chinese people's living standards and thus raised the question if it is still reasonable to let food account for about one third of CPI while excluding sky-rocketing house prices from the calculation of the overall price gains.

On the other hand, as the country is steadily shifting away from the decade-old reliance on investment and export for growth, its pursuit of consumer-led growth in the 12th Five-Year Plan (2011-15) period also calls for a sea change in the way statisticians measure people's living costs and inflationary expectations.

Hence, statistics officials are yet to get grips with their real challenges.