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Tuesday, February 11, 2020

Andreas Georgiou - Was It 'Breach Of Duty‘?

The story of Andreas Georgiou has been told many times in the international media because it is such a good story, albeit a very sad one. Georgiou was Director of ELSTAT, Greece's national statistics agency, for 3 years from August 2010 - August 2015. He was commended by Eurostat for having been the first Greek head of statistics who provided what Eurostat considered 'correct figures'. That got Georgiou into trouble with certain quarters of Greek officialdom and he was sued for several alleged crimes, e. g. by-passing ELSTAT's board of directors when reporting statistics to Eurostat, falsifying statistics, slander of predecessors, etc. As far as I know, most cases are still pending final judgment (correction: on the charge of failing to obtain board approval before reporting statistics to Eurostat, the Supreme Court, in June 2018, upheld the previous judgment of a suspended 2-year sentence, i. e. final judgment).

The Greek judiciary's treatment of Georgiou has triggered an international uproar. It seemed so obvious that Georgiou was being persecuted for telling the truth while no one had problems with his predecessors' having told lies. The latter was well described by the Icelandic journalist Sigrún Davídsdóttir in her article "Lies, damned lies and Greek statistics".

Thomas Cool, an econometrician and teacher in mathematics in Scheveningen, Holland, has now brought a new perspective to my attention (Cool uses the name Colignatus in science to distinguish this from his other activities in commerce or politics. See his website).

Colignatus argues that at the heart of the issue is Georgiou's by-passing the supervisory board when reporting figures to Eurostat. To recall: for the year 2009, Greece had submitted a budget to Eurostat indicating a budget deficit of 3,4% of GDP. This was subsequently corrected to about 6% but it stayed at that level until Giorgos Papandreou assumed power in late 2009. The new Finance Minister, Giorgos Papakonstantinou, shocked the world by revealing that the true budget deficit would be roughly twice that level. Eventually, he submitted a provisional figure of 13,4% to Eurostat. All of this happened prior to Georgiou's assuming the job of Director at ELSTAT.

In November 2010, 3 months after assuming his job, Georgiou reported to Eurostat a budget deficit of 15,6% for 2009, i. e. slightly higher than the previously reported 13,4%. He did so without first seeking board approval. Some commentators considered this merely a 'procedural matter', emphasizing that the European Statistics Code of Practice states that the heads of national statistical agencies 'have the sole responsibility for deciding on statistical methods, standards and procedures, and on the content and timing of statistical releases'. I, too, would have considered it as such a procedural matter because the substance of the report was not at issue.

The Greek judiciary has taken a different view: Greek laws were in place and Greek laws were broken, thus, a serious 'breach of duty' had occurred. The courts handed Georgiou a suspended 2-year sentence. Georgiou's appeal is pending (correction: sentence was confirmed by Supreme Court in June 2018).

Colignatus provides convincing evidence that (a) the law under which ELSTAT had been founded earlier in 2010 clearly stated that board approval was required prior to any outside reporting of statistics and that (b) the Statistics Code of Practice in force at the time (and since 2005) did not assign sole authority to national directors of statistical agencies. Colignatus provides rather convincing circumstantial evidence that Georgiou and his counterparts at Eurostat were well aware of this and colluded in the attempt to circumvent such board approval. Viewed from that standpoint, it was a clear 'breach of duty‘.

Colignatus argues that the above 'breach of duty', for which Georgiou is solely responsible, was at the heart of the issue because it then triggered all the other follow-up complaints and law suits. Colignatus further argues that both Eurostat and Georgiou are well aware that a violation of the law ('breach of duty') has occurred which is why they emphasize in their defense that Georgiou has never falsified statistics. This primarily in order to deflect attention from the main issue, the 'breach of duty'.

I have had lengthy exchanges with Colignatus about his position. My initial reaction was that it is rather irrelevant whether or not Georgiou by-passed his board when reporting statistics to Eurostat. The critical issue was (or should have been) whether or not his statistics were correct. Eurostat, as the final authority on statistics in the EU, confirmed (and complimented!) the quality of Georgiou's statistics and that was really all that mattered.

Having pondered the issue at length, I have become somewhat sympathetic to Colignatus' arguments. In a State of Law, laws do matter and if laws are violated, there ought to be punishment. It seems clear that Georgiou violated laws when by-passing his board of directors. Under normal circumstances, his colleagues on the board and at the agency might have considered that as a minor procedural mistake which could easily have been cured by providing post-approval. That, of course, assumes 'normal circumstances'. Circumstances in Greece were not normal at the time; neither at ELSTAT.

Perhaps Georgiou accepted the job at ELSTAT with a bit of naivité. Perhaps he thought he would be welcome there and that he would receive support from his colleagues in their joint effort to provide Eurostat with top-quality statistics. Well, that would have required a very substantial amount of naivité!

A seasoned manager would have known that he was about to enter a wasps' nest where undermining and mobbing would be ever present, and he would have prepared for that. He would have known that he could not afford the slightest misstep because he would immediately be crucified for it. And he would have been extremely cautious about colluding with Eurostat behind the backs of his colleagues at ELSTAT, knowing that his enemies would only wait for such a 'breach of duty' to happen. Apparently, Georgiou was not such a seasoned manager.



P. S.
Colignatus has published a book "Forum Theory and A National Assembly of Science and Learning". The chapter on Greece begins on page 155.

5 comments:

  1. Wow! I went through Colignatus' book. Certainly not looking good for Xafa or for Georgiou's international supporters. On the story itself, I am left thinking: was Georgiou that naive or was he convinced that -given the support of the Eurostat and the Commission- he could bypass the supervisory board without any consequences?

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    1. I would suggest that being convinced that - given the support of the Eurostat and the Commission -, he could bypass the supervisory board without any consequences, would be a perfect example of being very naive.

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  2. Dear Klaus, I am grateful for our discussion, while we maintain some differences. You portray Georgiou as a competent but naive person but you assume knowledge that cannot be checked yet. We hardly know what has been happening here, since there hasn't been an adequate scientific investigation yet. You suggest that Georgiou's environment was a wasp's nest, but Georgiou deliberately bypassed the board, and any board would not appreciate this, and you cannot infer that they would be wasps, which is a needless put-down of those other researchers. Why did Georgiou not simply confess from the start that he had violated the law ? My impression is that you haven't fully digested my chapter on the case. PM. The 2009 deficit was presented in April 2010 as 13.6% and in November as 15.4%, which in 2012 became 15.6%. The conviction of Georgiou for the violation of duty is irrevocable, by the Greek Supreme Court on 2018: http://www.ekathimerini.com/229460/article/ekathimerini/news/top-court-upholds-suspended-prison-sentence-for-former-statistician

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    1. Thomas, any social system, be it a family, a company, a bureaucracy or whatever, defends itself when it perceives threats from the outside. A national statistical agency which has been the subject of international ridicule for producing "Greek statistics" will automatically build up defensive walls when an outsider is appointed to "clean up the mess". This becomes even more forceful when the national statisticians are professionally competent and when the outsider is not a professional statistician.

      What I am saying is that the clash between the outsider and the nationals in a situation like the above is the most natural thing in the world, just like the fact that the outsider would find himself in midst of a wasps' nest. This would have happened in any similar setup in any other country. This is not a put-down of those 'wasps' because the most honorable people tend to behave like wasps in such situations. When the Pope sends people to clean out the Vatican Bank, they will run into a lot of wasps even though they are holy people...

      Regarding Georgiou's competency, my understanding is that he is not (and never was) a professional statistician. One has to be a VERY strong manager when one is in charge of a unit where the subordinates/colleagues have more professional competency and can make circles around you. Strong managers will handle such a situation successfully but they have to be VERY strong. I did not see in Georgiou's CV that he had a lot of management experience.

      My guess is that Georgiou probably felt that he was hired by Eurostat and responsible primarily to Eurostat. While this may have been the reality, one also has to pay close attention to the formalities (such as complying with national laws). If Georgiou felt that he had the power of Eurostat and the EU behind him in any conflict with nationals, he was extremely naive.

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  3. I like this reformulation better. But again you are assuming too much for my liking. One of the intriguing questions indeed is whether Georgiou and Eurostat had been in contact in the period before August 2 2010, when he officially started. Nevertheless, he would have been briefed that the old NSSG was replaced by a new independent El.Stat and that also the board was entirely new, with people from the academia and other, though with one member from the union. These new people with a new task do not strike me as a "vested interest" that you hypothesize. The description given by Zoe Georganta shows rather a perplexion that Georgiou marginalised the board, rather than that the board was waiting for him to make an error. Well, we both clarified our difference in view on this, and let us hope that the scientific community can set up a proper post-mortem.

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