HC Deb 24 July 1941 vol 373 cc1028-9
6. Sir William Davison

asked the Minister of Labour what are the chief items of expenditure taken into consideration in arriving at the estimated 30 per cent, increase in the cost-of-living figure; how many of such items, and to what approximate extent, are affected by rationing and shortage of supply by reason of war conditions; and whether allowance is made for this in arriving at the percentage increase referred to.

Mr. Bevin

A list of the principal items of expenditure taken into account in compiling the Cost-of-Living Index is given each month in the "Ministry of Labour Gazette." The items so taken into account of which supplies to consumers are rationed include beef, mutton, bacon, butter, margarine, cheese, tea, sugar, clothing and clothing materials, and boots and shoes; the distribution of eggs is subject to control. I have no statistics showing how far the consumption of other articles is affected by shortage of supply. As is stated in the "Ministry of Labour Gazette," this Cost-of-Living Index is designed to measure the average percentage change in the retail prices for a fixed list of commodities and services and does not attempt to assess the effect of changes in expenditure due to alterations in the consumption of rationed or the substitution of unrationed articles.

Sir W. Davison

Will my right hon. Friend consider whether it is not misleading to continue to estimate increases in the cost of living by increases in the cost of things no longer obtainable or only obtainable in lesser quantities by reason of rationing?

Mr. Thorne

And higher prices.

Mr. Bevin

That question does not complete the whole story. While it is true that certain articles are in short supply and are rationed, it must be borne in mind that the cost to the people has increased. A woman cannot use her ingenuity in buying when things are rationed. Therefore, I prefer to leave the index figure as a guide, as it always has been.

Mr. Pethick-Lawrence

Why do the Government continue to use an index based on the 1914 figure in view of the fact that an exhaustive inquiry has since brought the figures comparatively up to date? Why do they not bring in a new index figure based on that more recent inquiry?

Mr. Bevin

I do not think that affects the issue. There is a confusion between cost of living and standards of living. A new index might bring out, or it might not, that the standard of living has changed, but the relative change in cost will remain the same, so that this guide is as good as any other.