The Economy Ministry is drafting a bill to guarantee the functional and economic independence of the official statistics institute, the INDEC. According to a non-public draft seen by the Buenos Aires Herald, the project aims to transform the agency into a “decentralized and autarchic entity with functional autonomy and financial self-sufficiency”. Like today, it will work within the sphere of the Economy Ministry.
Although the executive power has not confirmed a date for the project’s submission, Economy Minister Sergio Massa confirmed in an interview with Perfil that he would send the bill this year.
Currently, the Executive Director of the National Institute of Statistics and Census (INDEC) is appointed by the president. The new draft, which is made up of 55 articles divided into five headers, aims to add the Senate’s express agreement as a requisite. The institute’s Technical Director would be appointed by the Executive Director, after background screening and competitive examination.
The bill assigns a five-year term of office to each of these roles, to assure the continuity of policies beyond specific governments. Moreover, the Executive Director can be renewed in office only one time.
The project also aims to create a “Bicameral Commission for the Follow-up of the National Statistical System”, made up of six senators and six representatives, which will even be able to recommend the removal of the Executive Director of the INDEC for poor performance.
A source in the Economy Ministry highlighted that the current law is over 50 years old and the bill seeks to adhere to the UN’s current Fundamental Statistical Principles. The goal, they added, is to strengthen the independence, objectivity and transparency of the institute.
The bill seems to emulate a project of the late Jorge Todesca, the INDEC’s head during Mauricio Macri’s administration, which never came to fruition. In 2016, sources close to him told the media that the INDEC’s self-sufficiency sought to avoid a “ferocious intervention that unmade the entity, its technical capabilities and lots of years of work” from ever happening again.
They were referring to the agency’s intervention from January 2007 to December 2015, led by the Kirchner administration. In a maneuver spearheaded by then-commerce secretary Guillermo Moreno, the figures published by the agency were highly contested. To give one example, according to the INDEC, inflation in 2014 was 23.9%. Consulting firm Eco Go measured a 31.4% price hike for that year.
The macrista opposition and even the trade union that grouped government employees at INDEC often spoke against the intervention and questioned the statistics it was publishing at the time. Moreover, the opposition reported its own inflation index, which was known as “Inflación Congreso”.
Moreno even spearheaded the legal prosecution of consulting firms that measured inflation. He went after Todesca and Marco Lavagna, the current head of the INDEC, accusing them of forging the numbers so that inflation-adjusted bondholders would receive a bigger return.
The intervention from those years still has consequences today. Fifteen years after a legal complaint against Moreno was filed, the INDEC offices were raided last April. Moreover, last October, four hedge funds that are suing Argentina over payments on instruments linked to the country’s GDP in 2013 told a London judge the country had a “propensity” to manipulate economic data to save billions of dollars. They believe the official growth rate of 2.96% was forged to avoid paying the “GDP coupon”, which was activated if the country’s economy grew by at least 3%. Reuters reported they are seeking damages of up to 643 million euros, (US$635 million).
Massa’s project seems to be a signal that such officialist meddling is definitively a thing of the past. However, the minister’s main political gain with the bill would be to reach bipartisan consensus on a matter that had sparked clashes between officialism and opposition, enhancing his image as a “bridge builder”.