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National Press Club Telstra Address - "Truth Damned Truth and Statistics"
 

BY DENNIS TREWIN, THE AUSTRALIAN STATISTICIAN

MARCH 9, 2005

INTRODUCTORY COMMENTS

Good afternoon.

I want to use this opportunity to talk to you about the role that the Australian Bureau of Statistics - or ABS as we all know it - plays in Australian Society. Unless you are a recent migrant to Australia, this institution is something you have grown up with. A bit like vegemite or cricket. This year we celebrate our centenary.

Celebrating a centenary provides an opportunity to reflect on what has changed for us, what has remained the same and what the future may hold.

As a statistician I learnt early to bear the crosses we statisticians have to bear. We know that look of amazement and amusement when people find out about our occupation. They recognise the importance of our role but find it difficult to believe that we enjoy it ! But we do.

We too know those jokes about statistics and I for one shiver when hearing the tired cliche about "lies, damned lies and statistics". It implies we are purveyors of lies, which is the very opposite of what we are trying to do. Hence, the title of this talk - "Truth, Damned truth and Statistics". Perhaps I can bury the myth.

THE ABS'S ROLE IN DEMOCRACY

First, I would like to discuss our role in a democracy.

Contrary to popular belief, in well compiled official statistics the numbers do not lie, but like all information they need to be viewed in their correct context and their quality needs to be understood. They may show certain information which may or may not gel with the perceptions of commentators. And they may not be welcomed by government because they can measure the magnitude of problems or policy failure or by oppositions because they can measure positive progress and policy success.

For these reasons a strong official statistical agency is one of the most important elements of an effective democracy. It is no accident that the two go hand in hand. To quote a 1993 White Paper on Open Government in the United Kingdom:

      "Official statistics are collected by government to inform debate, decision making and research both within government and by the wider community.
      "They provide an objective perspective of the changes taking place in national life and allow comparisons between periods of time and geographical areas.
      "Open access to official statistics provides the citizen with more than a picture of society. It offers a window on the work and performance of government itself, showing the scale of government activity in every area of public policy and allowing the impact of public policies and actions to be assessed."

Or to provide a more local flavour, the former Governor-General, Sir William Deane, once referred to the ABS as providing a "mirror" on society. An appropriate metaphor I'm sure you will agree.

To play this role effectively, the ABS has to be trusted. Trust means many things.

Trust means that statistics are compiled and presented objectively.

Trust means that there is confidence in the quality of the statistics. This doesn't mean the statistics are always "error free" but it does mean they have been collected and processed professionally and have not been fudged for expediency.

Trust also means that providers of data are confident that we are a reliable custodian of their data and that its confidentiality will be protected. By law, ABS must not reveal private information about individuals or businesses and we uphold that law without exception. Without that, we would not have the high level of public co-operation we experience in our collections.

As head of the organisation, I am passionate about maintaining trust in the work of the ABS. I know my predecessors have been just as committed.

As former Prime Minister, Billy Hughes once said of the Statistician at the time: "There are only two people I trust - God and the Commonwealth Statistician." That is some legacy I have taken on!

In my opinion it only requires one significant incident for that confidence to be questioned. It is for this reason that ABS is very measured in what it does. And we 'fess up' if we make errors. Many of you in the media know that we issue corrections on material if we have made a mistake. It is a deliberate policy.

That means you can have confidence in what we publish.

You can also have confidence that what we publish is good, clean, objective information, full of integrity and free of policy bias or political spin.

I am always gratified to see public debate that uses ABS statistics without qualification or question. For the fact is, the public and Australia can have strong faith in their official statistics. The same cannot be said for many other countries where pressure and influence can impact on what is collected, how it is collected and how it is released.

The need for a strong and independent national statistical office has been supported by a succession of governments, and indeed oppositions.

It is the role of a chief statistician to defend and uphold the integrity of official statistics. Australia's robust democracy demands that the ABS be objective and publish without fear or favour. That the challenge has been met for 100 years, is a credit to the wisdom of our political leaders: to let the ABS get on with its job and to provide it adequate funds to evolve its collections and activity as the needs of our society changes.

To my knowledge, there has not been an accusation of political partisanship against a Commonwealth Statistician or an Australian Statistician.

100 YEARS OF STATISTICS

I will now provide you with a very brief history of what is now the ABS.

I do not have time to give you all the background but a vision of reliable and objective information was at the heart of why Australia's national statistical agency was created, about 100 years ago, on the 8th of December 1905, with the passing of the Census and Statistics Act. The agency created in 1905 was known as the Commonwealth Bureau of Census and Statistics.

Fifty years later, in 1956, in what is something of a rarity, the Commonwealth and State governments agreed on an integrated statistical system that served both levels of government as well as the community at large. I believe this integrated system has served Australia well and is certainly superior than the federated system that still operates in some countries.

The national office continued to operate as the Commonwealth Bureau of Census and Statistics until 1975 and for much of the period was a branch of Treasury. From all reports, this did not affect the independence of the Bureau except on the important matter of budget allocations - not surprisingly funds for economic statistics were easier to find than those for social statistics!

The next major change was the transformation of the Commonwealth Bureau of Census and Statistics into an independent statutory authority known as the Australian Bureau of Statistics. This happened in 1975.

WHAT HAS NOT CHANGED OVER THE LAST 100 YEARS?

As part of our centenary year, we have been reviewing our history. A number of important things have remained largely the same over that time.

The core purpose of the ABS has not changed. It continues to be charged with providing a relevant and trusted statistical service to governments and the community at large.

Another constant is the influence of core values on how the ABS works. These values have remained constant over the years. In short they are relevance, integrity, professionalism, equality of access to ABS information, and protection of the confidentiality of information provided to the Bureau by both individuals and organisations.

I will pass on one anecdote that reinforces the importance given to confidentiality. It comes from Sir Roland Wilson who was a Commonwealth Statistician for periods during 1930's and 1940's.

Apparently the legislation for a Census of Wealth was hastily drawn up in the days before World War II. Consequently the legislation was badly drafted and mentioned that the Commissioner of Taxation could have access to the data - without making it clear that he could only access the collated information.

Subsequently, during a tax evasion case, the Commission of Taxation got the idea that he could win the case by accessing the defendant's individual Census of Wealth data. According to Wilson

"He ...came storming into my office one day and demanded this bloke's wealth card and I said he couldn't have it. 'Why?' 'Because they are confidential and if it was used in a court case it could wreck our reputation". The Commissioner of Taxation, not content with this reply, took the matter to Cabinet and convinced it to approve his access to the individual's data. Then he went back to Wilson to collect the information.

"Oh, he was on the seventh heaven of delight and he came storming along with his two Deputies, waved the Cabinet decision at me and said 'You've got to hand those cards over to me'. 'I'm sorry... I can't [said Wilson] 'What do you mean, I've got a Cabinet decision [the Commissioner exclaimed]. [Wilson replied,] 'You're about a week too late, I piled them into two trucks last week, sent them down to Sydney and incinerated them'."

I can assure you that I will be similarly protective of data provided to us, but not use the same tactics.

Another constant over 100 years has been the willingness to adopt new technology and methods to improve the way we do things. We recognise that innovation is essential if we are to move forward, and we are not shy about doing that. We are generally regarded as being a world leader in the application of technology and statistical methods.

WHAT HAS CHANGED FOR THE ABS?

Although the ABS's core purpose has not changed, many other things have. The biggest changes are in the type of outputs we produce, the way we produce them and the way we deliver statistics to users. I will discuss each in turn.

At the start of the life of the Bureau, the core statistics were based on the Population Census, birth, death and marriage registrars, customs records, other administrative systems and the occasional non-random sample survey.

When you compare what was done at that time with today's most important statistics you might be shocked:
  • No national accounts - quarterly national accounts did not appear until the late 1960s.
  • No balance of payments - they did not appear until the 1930s although trade statistics have existed since the early days.
  • No Consumer Price Index. But a Retail Price Index was first compiled in 1912.
  • No monthly labour force statistics until the late 1970s.

The way we produce statistics has also changed considerably with the advent of technology. No more slide rules or mechanical calculators and soon no mainframe computer!

The Population Census provides a good example of how the processing of statistics has changed. Hand processing was largely used in 1911. Four million records were involved. Not surprisingly, it took 3 years and a small army to produce the first results. Hollerith machines for sorting and tabulating were deployed for the following Census, and versions of this equipment used for subsequent censuses up until 1961. This reduced the cost of processing the Census as well as improving the timeliness and accuracy. Mainframe computers were first introduced in 1966 and improved technology has been used in each subsequent Census to improve performance. We have resisted the temptation to stand still. For example, we expect to process the 2006 Census in less time than in 2001. That's after an estimated eight per cent increase in population (and therefore the number of Census forms to process).

There has also been a dramatic change in the way we disseminate statistics. In the early days, there was complete reliance on publications, and they were relatively few in number, a release format which has only in the past 25 years begun to give way to electronic dissemination including CD-ROM's in the mid-1980s and the Internet since the mid 1990s.

Now to the future.

THE ABS AS A STATISTICAL PROVIDER

First, I will discuss the role of the ABS as a provider of official statistical services, and how we intend to maintain our role as the pre-eminent provider of national statistics.

The core role for the ABS will continue to be to provide the most appropriate sets of statistics that are fit for purpose. But the mix will change and ABS will need to keep up with that demand.

It would be foolhardy to try to predict the changes in statistical themes in the future except to say they are likely to be substantial. If you look back 15 years, the ABS did not produce environment statistics, information technology statistics, culture and leisure statistics or many statistics about Indigenous people except for a few Population Census based data items.

It is not just a matter of collecting statistics on a particular topic. For them to be meaningful, it is necessary to work closely with the users, especially the policy analysts, to better understand the underlying issues. We like to know the problem before we help with a solution.

There will be changes in the way the ABS collects data. Whilst censuses and sample surveys will continue to be the main source for official statistics, better technology has meant data from administrative systems are making something of a comeback as a source for official statistics.

What is increasingly possible is the ability to link data sets to make them much richer for statistical purposes. Our sister agencies in many other countries have already started down this path. We have been more cautious.

There are privacy issues that have to be carefully managed. We would not do anything that would threaten the confidentiality of those who provided the data.

Our 'Move Forward Strategy' in this arena is to reassure the public of our record of respecting their confidentiality interests while at the same time presenting the benefits of such developments.

Such changes may not be easy in an Australian context but have the potential to provide a statistical turbocharge to research and development in important areas of our lives such as health research.

The other big change in data collection will be the use of the Internet. Over the last 20 years, technology has changed the way in which data is collected and captured. This will continue in the future. As one example, an e-form is being designed for the 2006 Population Census. Take up rate is expected to be about 10% but this will surely increase over time.

Also, more and more businesses are interested in reporting by Internet especially if statistical returns can be automatically extracted from their own accounting systems. Some countries are examining these possibilities aggressively and we will watch these developments with interest.

Turning now to statistical outputs, it is hard to believe it is only 10 years since the ABS first established its web site. Now, apart from information provided through the media, it is how most statistical users obtain ABS statistics. Our web site now receives more than 5 million hits per year. This trend will continue with the rapid increase in the demand for statistics.

More generally, our more sophisticated users are looking for improved access to more detailed data for research and policy analysis purposes. Whilst fully understanding this need and trying to find ways to support it, the ABS must not do anything that would compromise the trust and confidence of respondents to our surveys.

There is another important trend. Increasingly, we find that our users want to compare statistics for Australia with those of other countries. This puts a context to Australian figures. Differences can be very illuminating in evaluating the effectiveness of current policy or assessing alternative policy options. This can only be done if you are comparing like with like. This is one of the reasons that the ABS is an active contributor to international statistics, particularly on the development of international standards. We are respected in these fora because we treat each issue on its statistical merit.

I have just mentioned a few of our future challenges but I hope it gives you a feel for how some aspects of official statistics might change.

THE ABS AS A STATISTICAL LEADER

Now, I will talk about the ABS as a leader of the national statistical system.

According to its legislation, the ABS has a responsibility for the coordination of official statistics. It is fair to say that the ABS has struggled to decide how to best fulfil this responsibility.

However, our role is now becoming clearer and exciting opportunities have emerged which will enable us to realise the potential of our legislation.

The world of statistics is changing and we are moving towards a national statistical system where the ABS is only one of the providers of statistics, albeit a very important provider.

A prime reason for the increase in providers of statistics is the advent of administrative data in digital form. Whereas in the past, the ABS would normally be expected to produce official statistics based on those systems, this is no longer the case - the administering agencies are often best placed to compile the statistics themselves, but the ABS has an important role to play to ensure these statistics are of good quality. These other providers of statistical services are looking for leadership, a role which the ABS is keen to provide.

So why is there support for increased leadership? I will provide two main reasons.

First, Government agencies increasingly need to work in a "connected" way. This will only work if they are prepared to share information including statistical information.

Second, it is also important that this information can be related - that is, we are using the same definitions and concepts to the extent possible. Also, that sound statistical methods are used. This requires leadership on standards, classifications and statistical methods, a role which the ABS is well suited to play.

The ABS is looking at a range of new initiatives to improve statistical leadership. One of the most important is the ABS' National Data Network initiative. This is a technology based initiative and a demonstration version is well under way.

The Network will create a distributed library of data holdings relevant to policy analysis and research. These data holdings will remain held and controlled by their custodian organisations. Whilst data will be held by each custodian, the National Data Network will provide a complete catalogue of available data sources to allow users to easily search for, and access data holdings which have been published. In effect, it will provide a portal to official statistics.

CONCLUDING REMARKS

To conclude, I must say it is a great privilege to lead an organisation like the ABS in its centenary year. It does have a fine history and, I believe, has served Australia well. It plays a vital role in an Australian democracy - not just because it provides information which provides a mirror on society - but because that information is trusted.

This trust has proven important to governments as well. Because of this trust, discussions can focus on what the statistics mean for policy rather than on the integrity of the statistics themselves.

Our 100 years of history has provided a fine shoulder on which to stand as we address the challenges of the future. There must be changes if we are to remain relevant and provide value for the money that is appropriated to us. But more than anything else we have to be careful that we don't lose trust - it is our comparative advantage. If we lose trust, we risk becoming just another information provider.

Thank you for listening.

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