41. Mr. Lee
asked the Minister of Labour whether he is aware that the difference in basis as between the new index of retail prices and the old one will cause variations between them in recording fluctuations in living costs; and, during such periods, which reading he proposes to use for official purposes.
§ Mr. Iain Macleod
Only one calculation is made, and all price changes after January, 1956, are measured only on the basis of the new official index, which now stands at 101. This index, however, records only the percentage change in prices since January, 1956, and, in order to give a comparison with the level of prices in June, 1947, is linked with the earlier series which terminated in that month. The basis of the mathematical calculation is given in the April issue of the Ministry of Labour Gazette.
Does the right hon. Gentleman agree that there has already been a discrepancy between the two indices, and that where 2 million or 3 million people have their wage rates determined by the alteration in the retail index we may certainly have trade unions insisting upon wage advances when the old index records the appropriate amount of advance, unless we can clarify their position in relation to the index that is being used? Will the right hon. Gentleman discuss this matter with the N.J.A.C.
§ Mr. Macleod
I am quite ready to discuss the matter with the N.J.A.C. I have made it clear that there is only one official index—that is the one which started upon a new and obviously better basis in January, 1956. Clearly, as the two have 202 different bases, it is possible that the same movement of prices could affect the two differently. That is what has happened in the last few months. I am continuing to publish the linking series until the adjustments in wage negotiations—to which the hon. Member has referred—are completed.