CURRENT AFFAIRS
Walter Radermacher
“WE GO EARLIER, AND WE GO FURTHER UP” The head of the EU’s statistics office talks to Delano about the agency’s new “quality assurance” powers. Interview by Aaron Grunwald Photography by Olivier Minaire
AG: What is Eurostat’s role? WR: We produce around 350 statistical products. Some of them are well known: how much income we have, how many fruit trees do we have. Then come the more difficult things, like what is the production of the states of the union, the famous GDP, what is the state of the environment, what is the link between pollution and lifestyle.
WALTER RADERMACHER “Our aim is that our figures are not contested”
WIDER REMIT
This autumn Brussels revamped the law governing Eurostat, the EU’s official statistics agency. Founded in 1952 under the auspices of the European Coal and Steel Community, it is one of the oldest EU institutions, and the only one that has always been based in the Grand Duchy. Today it employs around 800 staff at its headquarters, who in turn work with national statistics bureaus. Walter Radermacher, Eurostat’s director general since 2008 and a former chief of Germany’s federal statistics office, spoke to Delano about the Kirchberg-based agency’s new found authority.
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NOVEMBER 2012
AG: Are all European institutions your clients, for example the European Central Bank? WR: The European Central Bank is a client. For example, it was deliberately chosen that we produce the inflation rate. The harmonised consumer price index, as it is called in our jargon. And the ECB is the user of that. This is true also for quite a few quarterly national accounts figures. AG: What is different under the new law regulating Eurostat? WR: What changed is that over the years the governance has changed from a loosely coordinated system to a very, I would say, disciplined production, which I would compare with, say, the production of a premium car or a luxury good or very reliable machine. So we
are the final producer, delivering the car, the machine to the decision makers. And what has changed is that we now have the powers to also establish and to run a quality assurance system for the whole production chain. So we are the final producer of the car. We have a lot of providers. And, as in industry, we check at the entrance of our door the quality of these input data. AG: Does this mean that you’ll go to inspect national agencies’ work earlier? WR: Yes and this is new. So now we go earlier, and we go further up. To give you an example: the famous public finance data, the debt and deficit, which is part of the crisis. Of course our colleagues in national statistical offices are recipients of data from the public sector. If they receive lousy quality data, what can they do? So it’s really important to go upstream to ensure finally that the public accounts, for example, in the municipality, in the social insurance scheme, are correct. AG: Why is this important? WR: The question is linked to the use of the data. Imagine we produced data which are totally irrelevant--imagine--then nobody would care. And nobody would try to influence the data. But as soon as you are producing data which are relevant for decision making, which have a direct or indirect impact on money flows, such as structural funds going to regions in Slovakia or a region in Spain, then the figures are under pressure. There is a famous saying by an English economist Charles Goodhart, known as Goodhart’s law, which says as soon as you use an indicator and put pressure on it, it ceases to be a high quality indicator. This is what we have seen particularly in one of the countries which have led to this crisis of the public finances. AG: So you’re trying to prevent political manipulation? WR: It’s urgently needed that decisions made by the European political decision makers are trusted from Helsinki to Lisbon, Athens, Luxembourg and Edinburgh. And for that you need a higher level of premium class statistics.