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Policies (part 6): Something is rotten with our statistics
JAMES MOSS-SOLOMON
Sunday, December 11, 2011
THE question of accuracy and timeliness of official figures has been a contentious discussion for many years. I have personally made recommendations to the Caricom Heads of Government regarding the need for these essential tools of planning. My recommendations have been passed over and there is little change.
As a result of the non-compliance with this simple request we continue to base much of our planning on wrong principles as we attempt to justify expenditures and returns. In the case of the country it is largely done with borrowed funds that never get repaid.
Cruise ship visitors about to go on a tour in Falmouth.
Cruise ship visitors about to go on a tour in Falmouth.
It is much the same for the private sector who complains about the terms and conditions of loan financing, and who never mix their own capital in equity.
So they cling to the illusion that they are not responsible for their own predicament, and blame banks and the Government for their non-performance. They do not care to keep accurate accounts and don't want to show their true worth to others in a transparent way, and then they still feel justified to ask for loans, grants and incentives.
Mike Henry, when in Opposition, raised some pertinent points about the accuracy of the population census and claimed that we had three million people. He may have been right, but on coming to power he did not pursue this line. The possible reason is that with a greater population and the same Gross Domestic Product (GDP), the GDP per capita would be significantly less, and we would look more like Guyana and Haiti, rather than Barbados and Trinidad and Tobago. Reality would then come home to roost, but our politicians would not seem so great!
One of our great "pillars of the economy" — tourism — is another fictional success, in particular the sub-sector of cruise shipping. The major error is a basic one and starts with a miscount of the visitor numbers. The source of the statistics, by definition, states that the numbers are derived from the manifest, and not the number of persons that come ashore to spend the day and enjoy our tours.
So, for example, if I had a boat with 5,000 passengers and 50 came ashore, but next week my boat had 8,000 passengers and 50 came ashore, we would register a 60 per cent increase in visitor arrivals. Really?
Now, the self-deception would be quite harmless except for decisions that are made based on those figures. The great announcements by ministers over the years based on these figures have had a serious effect.
For people listening who had no employment, there was an immediate sense of job availability at the land attractions, in the transportation sector, craft vending, restaurants, and, of course, some sex. They left where they were living to go to places with no infrastructure, and set up themselves in squatter settlements that damaged the environment.
In the face of the reality of no "golden profits", squalor turned to crime and violence, and as the old song said (paraphrased), "on a damp and grey Jamaica morn, another little child is born in the ghetto". And life continues to become more hopeless, based on wrong figures and overexuberance.
For the Government side, the fictitious numbers provide a convenient basis for cruise shipping lines to negotiate and demand our investment (read borrowing) for facilities at the ports for people who never come ashore. A case in point should be a careful analysis of our "investment" in Falmouth as it is very current. Important questions should be total cost, our portion, our investment in shore facilities and infrastructure adjacent to the port and also in the town, the disruption of commerce, the cost of new roads, and the dislocation of people.
When we have done that we should also check the port fee concessions, and the lower head taxes involved with the "investment", when we will recover our money and who apart from the cruise line gets rich as a result of the fiasco. This could really be a great forensic audit of a possibly poor investment of taxpayers' money based on fantasy. But as usual, I suppose that no one in authority will be bold enough to test that.
I understand that most attractions that were counting on the new "Falmouth Bounty" have been extremely disappointed thus far, and some are about to go into receivership. Please note that all of this comes as tourism is "booming and doing better than the rest of the world".
The international figures claim that cruise shipping worldwide is in excess of US$240 billion, and that the Caribbean accounts for 50 per cent. So by my reckoning, that should be around US$120 billion.
Now, Jamaica, with three full cruise ship ports (and a partial one in Port Antonio), could account for say, five per cent of that traffic. By my simple arithmetic that should be US$6 billion, but our statistics show tourism as contributing about US$2 billion per annum, and that includes the stopover visitors.
Believe me, something is rotten with our figures and there are a few implications of a serious nature based on all the possibilities I can think of:
1) The figures are totally wrong.
2) The persons who disembark are really much fewer than those that stay aboard.
3) They all come off but spend only a few dollars each.
4) Our only revenue is the per passenger fee and we provide cheap water, and lovely, unused facilities for this "great privilege".
5) The per passenger fee is less than the cost of running the port and the cheap water supplies, and we have invested in a business that will never make us a profit now or in the future.
6) The ship owners are much smarter negotiators than we are.
7) Some really corrupt crap is taking place.
As we say in Jamaica, "pick yu choice, the whole a dem nice", but not so for us, the taxpayers.
These two sources of error are really the tip of an iceberg that threatens to sink our country, as we continue to massage the "feel-good factors" that leave a blurred area between politics and good governance.
It applies to many other areas, but businesses and government will no doubt continue to make decisions on wrong assumptions and wrong intentions.
I am so sorry to do this in the middle of our season of believing and hope for redemption, but Christ came to save our souls, not our statistics. This job properly rests with our bureaucrats, and the intellectuals at our several universities.
Blessings, peace, joy, and love to you and your families as we face the really silly season of false promises.
Read more: http://www.jamaicaobserver.com/colum...#ixzz1gHJXmIDb
JAMES MOSS-SOLOMON
Sunday, December 11, 2011
THE question of accuracy and timeliness of official figures has been a contentious discussion for many years. I have personally made recommendations to the Caricom Heads of Government regarding the need for these essential tools of planning. My recommendations have been passed over and there is little change.
As a result of the non-compliance with this simple request we continue to base much of our planning on wrong principles as we attempt to justify expenditures and returns. In the case of the country it is largely done with borrowed funds that never get repaid.
Cruise ship visitors about to go on a tour in Falmouth.
Cruise ship visitors about to go on a tour in Falmouth.
It is much the same for the private sector who complains about the terms and conditions of loan financing, and who never mix their own capital in equity.
So they cling to the illusion that they are not responsible for their own predicament, and blame banks and the Government for their non-performance. They do not care to keep accurate accounts and don't want to show their true worth to others in a transparent way, and then they still feel justified to ask for loans, grants and incentives.
Mike Henry, when in Opposition, raised some pertinent points about the accuracy of the population census and claimed that we had three million people. He may have been right, but on coming to power he did not pursue this line. The possible reason is that with a greater population and the same Gross Domestic Product (GDP), the GDP per capita would be significantly less, and we would look more like Guyana and Haiti, rather than Barbados and Trinidad and Tobago. Reality would then come home to roost, but our politicians would not seem so great!
One of our great "pillars of the economy" — tourism — is another fictional success, in particular the sub-sector of cruise shipping. The major error is a basic one and starts with a miscount of the visitor numbers. The source of the statistics, by definition, states that the numbers are derived from the manifest, and not the number of persons that come ashore to spend the day and enjoy our tours.
So, for example, if I had a boat with 5,000 passengers and 50 came ashore, but next week my boat had 8,000 passengers and 50 came ashore, we would register a 60 per cent increase in visitor arrivals. Really?
Now, the self-deception would be quite harmless except for decisions that are made based on those figures. The great announcements by ministers over the years based on these figures have had a serious effect.
For people listening who had no employment, there was an immediate sense of job availability at the land attractions, in the transportation sector, craft vending, restaurants, and, of course, some sex. They left where they were living to go to places with no infrastructure, and set up themselves in squatter settlements that damaged the environment.
In the face of the reality of no "golden profits", squalor turned to crime and violence, and as the old song said (paraphrased), "on a damp and grey Jamaica morn, another little child is born in the ghetto". And life continues to become more hopeless, based on wrong figures and overexuberance.
For the Government side, the fictitious numbers provide a convenient basis for cruise shipping lines to negotiate and demand our investment (read borrowing) for facilities at the ports for people who never come ashore. A case in point should be a careful analysis of our "investment" in Falmouth as it is very current. Important questions should be total cost, our portion, our investment in shore facilities and infrastructure adjacent to the port and also in the town, the disruption of commerce, the cost of new roads, and the dislocation of people.
When we have done that we should also check the port fee concessions, and the lower head taxes involved with the "investment", when we will recover our money and who apart from the cruise line gets rich as a result of the fiasco. This could really be a great forensic audit of a possibly poor investment of taxpayers' money based on fantasy. But as usual, I suppose that no one in authority will be bold enough to test that.
I understand that most attractions that were counting on the new "Falmouth Bounty" have been extremely disappointed thus far, and some are about to go into receivership. Please note that all of this comes as tourism is "booming and doing better than the rest of the world".
The international figures claim that cruise shipping worldwide is in excess of US$240 billion, and that the Caribbean accounts for 50 per cent. So by my reckoning, that should be around US$120 billion.
Now, Jamaica, with three full cruise ship ports (and a partial one in Port Antonio), could account for say, five per cent of that traffic. By my simple arithmetic that should be US$6 billion, but our statistics show tourism as contributing about US$2 billion per annum, and that includes the stopover visitors.
Believe me, something is rotten with our figures and there are a few implications of a serious nature based on all the possibilities I can think of:
1) The figures are totally wrong.
2) The persons who disembark are really much fewer than those that stay aboard.
3) They all come off but spend only a few dollars each.
4) Our only revenue is the per passenger fee and we provide cheap water, and lovely, unused facilities for this "great privilege".
5) The per passenger fee is less than the cost of running the port and the cheap water supplies, and we have invested in a business that will never make us a profit now or in the future.
6) The ship owners are much smarter negotiators than we are.
7) Some really corrupt crap is taking place.
As we say in Jamaica, "pick yu choice, the whole a dem nice", but not so for us, the taxpayers.
These two sources of error are really the tip of an iceberg that threatens to sink our country, as we continue to massage the "feel-good factors" that leave a blurred area between politics and good governance.
It applies to many other areas, but businesses and government will no doubt continue to make decisions on wrong assumptions and wrong intentions.
I am so sorry to do this in the middle of our season of believing and hope for redemption, but Christ came to save our souls, not our statistics. This job properly rests with our bureaucrats, and the intellectuals at our several universities.
Blessings, peace, joy, and love to you and your families as we face the really silly season of false promises.
Read more: http://www.jamaicaobserver.com/colum...#ixzz1gHJXmIDb
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