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Editorial: More in-depth probe needed over labor ministry stats scandal

An investigation by the labor ministry's special inspection panel fell far short of getting to the bottom of the corrupt statistics scandal at the ministry, which caused tens of billions of yen in payment shortfalls for work-related benefits affecting tens of millions of workers.

The finding by the committee comprising lawyers and scholars, which was announced on Jan. 22, presented statements by officials involved and did not provide evidence or detailed data backing up their claims.

In response, the Ministry of Health, Labor and Welfare announced the punishment of 22 current and former officials including its top bureaucrat over the matter. It's clear that the government wants to settle the case as soon as possible.

The statistics in question are from the ministry's Monthly Labor Survey that checks wages and work hours. Some of the published data is deemed tainted because ministry officials began collecting information on only around one-third of some 1,400 employers with 500 or more workers in Tokyo starting January 2004, although they were supposed to cover all of such companies. Moreover, the bureaucrats failed to apply necessary statistical adjustments to make the results of the sampling survey acceptable. As a result, improper data had been published for 15 years.

The inspection panel's report explained that ministry officials committed the act because they tried to "accommodate requests from prefectural governments to ease their burden in the face of many complaints from the companies."

However, Tokyo Metropolitan Government officials denied that they made such a request. Panel members did not interview officials of the metro government or polled companies, but they concluded that they "could not confirm an organizational cover-up" at the ministry of the stats problem. There is no way they could have revealed the truth after only investigating for a week.

Whether the illicit practices at the ministry were arbitrary or not can only be judged by checking the selection process and the scale of some 500 companies the officials had picked as the targets of the sampling survey. The opposition camp is demanding the submission of original statistical data or information about the companies picked out to the Diet.

The labor ministry began applying statistical adjustments to the sampled data from January 2018, but chose not to make the change public. As a result of this adjustment, wage levels for the last year went up. The development corresponds to the arguments made by the administration of Prime Minister Shinzo Abe that the pay rise was an achievement of the "Abenomics" policy mix of economic stimulus and financial easing measures.

However, the rate of wage growth for 2018 would be up to 0.7 percentage of a point lower should adjustments be made to data from 2012 and later. This can trigger suspicions that inappropriate surveys and adjustments were carried out with some ulterior motives.

The panel report explained that the ministry manager in charge did not announce the introduction of statistical adjustments in January last year because the person thought that the changes were "within the margin of error." This is the core issue of the entire scandal, and a more detailed explanation about this process is necessary.

The Monthly Labor Survey provides some of the fundamental statistics used to calculate gross domestic product (GDP) and affects government policies and corporate activities. Many more questions remain unanswered, and a thorough search for the truth is required.

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