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Updated December 15th, 2021 at 12:40 IST

Japan's Land Ministry admits overstating data on construction orders for nearly 10 years

The monthly construction orders is one of Japan's 53 important economic statistics that are derived using data given by around 12,000 enterprises every month.

Reported by: Anurag Roushan
Japan
Image: AP | Image:self
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On Wednesday, the officials in Japan revealed that the government overstated monthly data on construction orders for approximately eight years, increasing the possibility that the practice resulted in a miscalculation of the country's gross domestic product figures, Kyodo News reported. Since fiscal 2013, the Ministry of Land, Infrastructure, Transport, and Tourism had double-counted some of the data it received from the same businesses while generating its monthly construction orders statistics. The monthly construction orders, one of the country's 53 important economic statistics, are derived using data given by around 12,000 enterprises every month. They are used to calculate the country's GDP and to impact government planning as well as corporate management decisions.

Meanwhile, Prime Minister Fumio Kishida stated during a parliamentary session on Wednesday that data misrepresentation had no effect on GDP figures for fiscal years 2020 and 2021. "It was a terrible mistake. We must do everything possible to prevent such kind of occurrence, he was reported by Kyodo News as saying. Land Minister Tetsuo Saito also extended an apology during the session. Every month, prefectural governments collect data on construction orders from businesses before presenting them to the ministry.

However, there have been cases where businesses failed to submit survey results on time or submitted the data for several months at once. For years, local governments in the country were asked to report the combined orders as the total for the latest month, and this practice continued until March this year. Until the fiscal year 2012, the ministry deemed a company to be out of business if survey results were not submitted on time. 

'Doube-counting of some data wasn't perceived as concern initially'

However, in fiscal 2013, it revised its policy and made estimates for companies that did not submit survey results based on data provided by other businesses. It led to double counting of certain figures when such organisations later submitted in past order data beyond the deadline. After the Board of Audit of Japan indicated it was an inappropriate approach, the ministry discontinued using such a practice. According to a ministry official, those in charge at that time did not perceive the double-counting of some data to be a concern, the Japanese news agency reported. 

Image: AP

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Published December 15th, 2021 at 12:40 IST

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