Can’t measure poverty without Consumption Spending data: PMEAC chief

In the first official signal that the government is looking at resuming the Consumption Expenditure Surveys by the National Statistical Office, the Prime Minister’s Economic Advisory Council chief Bibek Debroy said on Wednesday the Survey would be carried out this year ‘in all probability’.

Stressing that India might never have comprehensive data to measure income inequality, Mr. Debroy said it was unfortunate there had been no official data on consumption expenditure since 2011-12, as it made it impossible to assess poverty levels in the country in the absence of such data and the lack of a clearly articulated poverty line.

Usually conducted every five years, the Consumption Expenditure Survey was last done in 2017-18 but its findings were held back, citing data quality concerns.

Commenting on a report released by the Institute of Competitiveness on the State of Inequality in India, Mr. Debroy said: “Offhand, I think that the Gini coefficient in terms of consumption expenditure would probably be at 0.35 or something like that for urban areas today, and rural would be a little bit lower”.

The coefficient is used to measure income distribution across populations, with a score of zero indicating perfect equality in income levels, and one indicating absolute inequality.

“It all boils down to data. What data are we using? How are we measuring poverty? The fact of the matter is that in India, we have never had data, comprehensive data, and we will never have data on measuring income equality,” he noted.  

“Unfortunately, it is the case that the last comprehensive analysis data on consumption expenditure is for 2011-12. And we have had nothing after that. In all probability, another consumption expenditure round will start this year,” he said.