Pali Lehohla
Pali Lehohla

OPINION: Why is trust so important?

By Pali Lehohla Time of article published Dec 1, 2019

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JOHANNESBURG - Reputation takes long to build.  Statistics is a conduit of trust.   

By the way, trust builds, but extremely slowly - only at a snail’s pace.  Once betrayed, however, it gallops like the chariots of fire and vanishes without a trace.  Good intentions can take you only that far, it is actions that are predictable that build trust.  

In economic terms, trust creates the platform for credibility and positive outlook and the statistics builds a firm base on which decision on whether or not to make investments in a country are made.  

The Boks’ victory of the 2019 Rugby World Cup brought a cheer to a South Africa that is trying to find its feet along a steep and slippery economic slope.  This slope is marinated with vulgar rent seeking politics and violent social fabric.

The news of the victory besides attracting party poopers from our complex politics were soon watered by the Poverty and Inequality Report that the Statistician-General Risenga Maluleke released on November 14.  

Our long faces were, however, lifted when the same Statistician-General released the Consumer Price Index six days later.  This was in anticipation of a rate cut.  It came in  at 3.7percent.  But it was not to be.  And this was because three out of the five Monetary Policy Committee (MPC) members of the Reserve Bank decided to be party poopers and voted against a rate cut.  

Minister of Health  Aaron Motsoaledi  on  November 8 had just lifted the requirements for certificates on foreign minors, which provides relief for  tourism numbers.   But coming six years later after being imposed,  was little  consolation.

But the tourism statistics recently showed low levels of international arrivals as international tourists as the stringent visa requirements put tourists off visiting South Africa.  And it took six years to reverse a bad decision.  

How long does it take for South Africa to know it is time to take medicine?  Probably when we are left with the last gasp of breath.  

November also witnessed the short-lived SAA strike that saw our carriers international and local flights cancelled for about a week.  Flight Centre, the global agency that sells SAA 
tickets would have none of it. They stopped selling SAA plane tickets with immediate effect a week after the resumption of flights.  

Celebrated American author Mark Twain famously  once said, " “October: This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.”

Twain writing on River Mississippi has always feared October, the month when the 1929 Stock Exchange crashed.  

If Twain was confronted by a month with such bad news as South Africa experienced this November, he would have advised us to avoid  November and probably August.

August in South Africa saw us witnessing  the most heinous crimes against our female counterparts.  February too was a bad month because it was the month in history former president Jacob Zuma resigned, so is September because it was the month president Thabo Mbeki resigned.   So if we were to follow Twain’s advice we would seek a month when we knew peace in South Africa.  But probably there are none in the light of the Zondo Commission findings, which reveal some of the most harrowing renditions about looting the resources of the state.

The level of impunity with which this was executed reflects cold blooded disregard for South Africa’s future.  Looking ahead, our faces are going to remain long for a very long time though.  

This is not because of the Zondo Commission or the many causes I have alluded to, but because of a more sinister and insidious consequence that is creeping into our citadel of numbers.

The poverty and inequality report Maluleke released is based on 2015 Living Conditions Survey (LCS).

By design the LCS should alternate every two-and a-half years with the Income Expenditure Survey (IES), the last having been conducted in 2010/11.  

Both these surveys have now missed a cycle because they have not been funded with the IES missing the cycle by almost twice the prescribed interval of five years. But even if they were to be funded the patient is left with the last gasp.  It will be long before we get new weights for rebasing the consumer price index (CPI) and even much longer before we know what poverty measures were like by the second half of the so called wasted decade.  

If the past decade was wasted years, wait until we conclude the next.  This next will be a decade of the destruction of the Statistics System of South Africa.  

The Governor of the Reserve Bank in a short while will not be able to set the repo rate because the Statistician General will soon not be in a position to provide him the granular CPI numbers.  

The adjustment to salaries and social grants will soon be a matter of grave arbitrariness so will be the lending rates by banks.  A bigger chaos will soon land in South Africa if the authorities fail to address and arrest the danger lurking on our lodestar – the statistics systems.  

The ratings agencies will join the Auditor General in providing a disclaimer around our ratings. It will however be nothing new because we excel in scoring own goals.  That scares Mark Twain.

Dr Pali Lehohla is the former Statistician-General of South Africa and the former head of Statistics South Africa.  Meet him on and @PaliLehohla


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