CSO seeking means to provide more accurate economic data

Director general says GDP figures, leading to ‘leprechaun economics’ claims, compiled correctly

At the MacGill Summer School, CSO director general Padraig Dalton said:   ‘GDP and GNP, although required internationally, no longer provide a sufficient understanding of the domestic economy.’ Photograph: Davd Sleator/The Irish Times

At the MacGill Summer School, CSO director general Padraig Dalton said: ‘GDP and GNP, although required internationally, no longer provide a sufficient understanding of the domestic economy.’ Photograph: Davd Sleator/The Irish Times

 

A group of experts is being established to provide more accurate data about economic growth in Ireland, the director general of the Central Statistics Office (CSO), Padraig Dalton has said.

At the MacGill Summer School in Glenties on Tuesday, Mr Dalton responded to the controversy over the Republic’s estimated 26 per cent GDP growth in 2015, which was described by American economist Paul Krugman as “leprechaun economics”.

Resolving the issue would require “considered and reflective debate”, he said, noting that “the unprecedented increase” had caused some unease for the CSO.

Mr Dalton said, however, that the figures were compiled correctly.

“Reporting of GDP is a requirement under EU law and must be compiled strictly in accordance with international rules. The revisions published were based on hard data and attributable to globalisation of a very small number of companies,” he said.

Mr Dalton said that because of “strict confidentiality rules” the CSO was limited in its ability to explain the growth rate and was “obliged to suppress certain detail which, understandably, was an issue for many users”. He said additional and “more coherent” data was required to get accurate growth information.

“GDP and GNP, although required internationally, no longer provide a sufficient understanding of the domestic economy and we need to supplement these internationally agreed indictors with a broader suite of indicators that can provide the necessary insights,” he said.

“A group of experts is being convened to undertake this work and they will be tasked with preparing a report which will be published later this year,” added Mr Dalton.

Rising population

Mr Dalton said the Republic’s population has increased by more than one million - to 4,757,976 - in the past 20 years and that this posed challenges in a range of areas such as health, education, employment and pensions.

Prof Tony Fahey, of the UCD School of Applied Social Science, said the Republic had one of the highest birth rates in the developed world. This was a “a problem many EU states” with falling birth rates “would love to have”, he said.

Prof Fahey said “the vitality of Ireland’s birth rates” was driven by the “unusual willingness of the Irish middle class women to have large families, as long as they are married”.

“When we come to 2011, we find that children have fewer siblings but not as few as we often think,” he added. “It is true that the average woman reaching her mid-40s in Ireland in 2011 had just over two children and that makes us think of the two-child family as the norm. But when we factor out childless women and give due weight to women who had three, four or five children, we find that the average child in this period grew up in a family of 3.3 siblings and almost 40 per cent were in families of four or more siblings.”

Gerard O’Neill, chairman of Amarach Research, agreed that the changing demographics posed many challenges but that they all appeared manageable and seemed “considerably less threatening than the problems our ancestors faced, whether 100 years ago in 1916 or those faced by more recent generations”.

He proposed the forging of a “new patriotism to overcome the doubt and distrust that threaten to pull us apart in the face of a ‘winner takes all’ economic future”.

Colm McCarthy, the writer and lecturer in economics at UCD, said that with increased longevity it seemed clear that the age for receiving the pension must rise and that the compulsory retirement age must be scrapped.