Now, prison terms for data delinquents

The new Collection of Statistics Bill, 2008, passed by the Lok Sabha on 23 December (the Rajya Sabha passed it on 19 December) is intended to improve the data collection ability of the government. But it also provides for a fine of up to Rs10,000 or a prison term, or both, for anyone proven to have obstructed a statistical officer in data collection.

Also See The Collection of Statistics Bill (PDF)

The long-delayed Bill was first introduced in Parliament in May 2007 and then referred to a standing committee of parliamentarians for further scrutiny. That group’s recommendations led to 32 amendments to the Bill, minister for statistics and programme implementation G.K. Vasan said while introducing the Bill in the Rajya Sabha.

The new Bill, when signed into law, will repeal the Collection of Statistics Act, 1953.

Under the 1953 Act, providing corporate data—typically about prices, production and capacity—was entirely voluntary and left open the room for companies to ignore requests.

“Now, we can make data submission mandatory for individuals and companies," said Pronab Sen, chief statistician of India and secretary at the ministry of statistics and programme implementation.

Sen had often pointed out that, for instance, the vital provisional Wholesale Price Index published weekly is actually based on a meagre 20% data, thus reducing the reliability of the index. And home minister P. Chidambaram, until recently India’s finance minister, has publicly questioned the reliability of India’s official industrial output data.

“The new Act will provide more teeth to the statistical agency to collect relevant data," says Dharmakirti Joshi, principal economist with credit rating agency Crisil Ltd. “After (economic) liberalization, nobody was under compulsion to provide information. Hopefully, this would improve the credibility of statistical indices."

The new Act also toughens data security by providing equally punishable provisions if data collection officers fail to maintain secrecy of the information. It is unclear if this threat of a fine or imprisonment will be enough for companies to stop worrying about whether confidential data, now mandatory on request by the government, will be leaked to business rivals by government officials.

India has a history of large companies being able to routinely obtain even confidential government filings by rivals, with some large publicly traded companies routinely boasting about their data “acquisition" abilities and often openly supplying key documents submitted by rival companies to the news media. Official organizations, such as the Telecom Regulatory Authority of India, are notorious for leaked documents and data leaks.

“I would only hope that the statistical authority does not reintroduce the inspector raj. And, I think, it is extremely important that these regulations and these rules are obeyed or managed in a manner in which it does not lead to this kind of harassment," said C. Rangarajan, former Reserve Bank of India governor who also chaired the National Statistical Commission that had advocated the new Act. He was speaking in the Rajya Sabha.

Minister Vasan promised Rajya Sabha members that data collected from companies wouldn’t be misused. “Informants have to furnish the truth to the best of their belief to the data collectors, without any fear or favour, or any apprehensions that the data could be used against them either for taxation or for prosecution in other cases."

Crisil’s Joshi says the onus will be on the ministry. “If government wants information, it must respect its sanctity."

Liz Mathew contributed to this story.

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