The contributions of the board members of Statistics Mauritius(SM) seem to be most of the time useless and there are there mainly for the hefty allowances and just to toe the line –exemplary yes-man. The only moment that they are singularly active is when tea and “gateaux piments” are being served. As long as we have such chatwas on the boards, we should not be surprised that our institutions have , of late, been suffering from an ethical and governance deficit. They have repudiated independence, transparency and accountability with a brazen shrug of callousness and indifference.
Statistics Mauritius, which once stood out as an independent reputed institution providing quality statistics that largely reflected international standards and best practice, have now have lost its independence, sheen and respectability.
The IMF, which appears to have noticed this threat to the independence of SM, made the following observations in their July 2022 staff report on Mauritius:-
“Continued efforts are necessary to further strengthen public financial management and fiscal transparency, and safeguard independence of Statistics Mauritius. The February 2022 report of the National Audit Office drew attention to lapses in procurement and deficiencies in the management of government projects and reiterated the need to obtain value for money as well as strict observance of procurement rules and proper management of capital projects. It is also important to safeguard statistical independence of Statistics Mauritius in its estimations of economic developments and outlook.”
While our board members were unproductively busy gulping down this one among their many hefty allowances and unashamedly bending to the wind, we were noting down the gradual debasement and the undermining of one of our prime institutions.
First , Ms Li Fa Cheung Kai Suet who was appointed Director of Statistics Mauritius in June 2018, resigned in August 2021, a few months after the resignation of the Chairman of the Statistics Board, Gilbert Gnany. It would appear that she was concerned about the independence of SM from political interference, following controversial GDP and employment statistics.
Second, nothing was done to integrate the Special Funds(SF) into the budget for better expenditure coordination, accountability and transparency despite repeated recommendations from the IMF. Our fiscal analysis is not based on a consolidation of budgetary central govt with special funds. Unspent budget transfers to Special Funds accumulate as surplus balances there, and the budget balance therefore overestimates the fiscal deficit. In 21-22, this wasn’t the case, as SF spending matched budget transfers. In the coming years, SF spending is likely to exceed budget transfers to SF (in line with the electoral cycle) and the budget balance will then underestimate the fiscal deficit. Thus , our board members kept on ignoring this important statistical issue - that consolidation with special funds would provide a good measure of the fiscal deficit and a better analysis of current and capital expenditures.
Third, Public Sector Debt (PSD) is being underestimated by a consolidation adjustment , which is not in line the IMF's statistical standards and is disregarded by the IMF in its calculation of PSD of Mauritius. By IMF standards, PSD debt ratio should therefore be 82% of GDP as at June 2023 without the consolidation adjustment, that is including the Rs16 bn, or about 3% of GDP.
Fourth, a net equity sale of Rs13 bn was assumed from the sale of Air Mauritius shares for Rs25 bn , net of a payment of Rs12 bn to Air Mauritius creditors. The amount of Rs 12 bn represents bail out expenses for the national airline and appears nowhere in budget data. it should have been added to expenses in the fiscal tables to give a better idea of Govt spending. PSD was thus reduced by Rs25 bn, or 5% of GDP i.e the PSD ratio would have been even higher by another 5% of GDP without this BoM/MIC financing.
Fifth, it’s about the expenditures that have been disguised as loans or equity. The high levels of net acquisition of financial assets (NAFA) are explained by equity investments ,not really meant for investments, but to cover operating expenses of SOEs, like Wastewater management authority, CWA, CEB etc, as well as bail out expenses of BAI. The recent equity investments in these white elephants are likely to be loss making and will further call for similar govt support in the coming years, which means higher budget deficit, higher overall borrowing requirement and greater fiscal adjustment efforts in the future.
Sixth, public debt data are published by the Ministry of Finance, while SM only reproduces the ministry’s debt figures. Dear Board members ,SM should be reporting debt data in line with the IMF GFS manual independently of Govt. That’s why you are there on this Board to ensure that we do not have the concocted adjustments to artificially reduce the debt level. (Please note that on Govt Public Finance statistics, SM publishes a detailed monthly statement of budgetary central govt operations, normally available after a 2 month lag.)
Seven and Last , the Medium Term Macroeconomic Forecast's (MTMF) three-year fiscal projections do not appear to be realistic and reflect a lack of adherence to fiscal accounting standards.
While one after another, our institutions are being undermined , our board members seem to be too busy pocketing and enjoying their fat allowances to wake out from their forced stony dun slumber and realise how SM is invariably been hijacked by this unscrupulous and incompetent regime and understand the profound disillusionment – even complete mistrust – with which many Mauritians are now regarding official data.
This government is more intent on the manipulation of public perception leaving people in the dark and with doubts on what is really happening to the economy.
