It is Groundhog Day at the Australian Bureau of Statistics (ABS).
The organisation has already been savaged by funding cuts and jobs losses under the prior two governments (both Labor and Liberal), thus hampering its ability to perform its functions.
When the former Labor Government cut funding to the ABS by $20 million during the GFC, it reduced the scope and sample size of the both the Labour Force and Retail Trade surveys, significantly reducing their reliability. It also ceased the job ads survey, whose impact can clearly be seen in the next chart, where data is missing for the crucial post-GFC period. Thankfully, all surveys were later reinstated to their former glory.
Then under the Abbott Government’s first Budget, the ABS was forced to cut its expenditure by $50 million over three years, which led to 100 staff being cut from the organisation. This left the ABS to perform its functions using a reduced sample in some surveys, less staff, and an antiquated computer system.
The effects were most evident with respect to the monthly Labor force survey, whose sample size was reduced, resulting in some wild gyrations and erroneous figures, leading to widespread ridicule and condemnation from analysts and commentators, as well as damage to the ABS’ once esteemed reputation.
Last month, Fairfax’s Peter Martin revealed that the ABS is about to cut some critical surveys because it does not have sufficient resources, with the monthly retail sales survey, those related to housing and lending finance, as well as a number of surveys on international trade all in the firing line.
And of course more recently we witnessed the massive Census fail.
Today, it has been revealed that the ABS will cut another 150 jobs as it battles to remain within its slashed budget. From The Canberra Times:
Workers at the bureau, which finished the past financial year more than $36 million in the red, were told on Friday morning that management will be looking to get up to 150 employees to accept voluntary redundancies in a process that is to begin immediately…
The axe is falling just weeks after Chief Statistician David Kalisch said data collection on foreign ownership of agricultural businesses, industrial disputes, motor vehicle sales, livestock slaughter, and crime offenders and victims, could all stop because of the financial pressures the bureau faced…
The federal opposition was also critical on Friday with Shadow Assistant Treasurer Andrew Leigh saying the job cuts showed the Coalition was taking its attack on public servants to the “next level”…
“This government’s ideological obsession with downsizing the public service has blinded it to the important work that ABS staff do to inform public policy and help allocate government resources to where they are needed most.”
This is complete and utter madness. Timely and accurate data are vital to good decision making, and these cuts risk hampering the Government’s ability to formulate policy, the RBA’s ability to accurately read the economy and formulate monetary policy, as well as the public’s decision making and ability to evaluate policy. It is a retrograde move that will provide minimal cost savings at potentially great long-term cost to the Australian economy.
If anything, the Turnbull Government should boost the ABS’ funding to ensure that the RBA and policy makers are not left in the dark during what is likely to be a massive structural adjustment over the next few years as various forces collide, both domestic and global.
