§ Mr. Malcolm BruceTo ask the Chancellor of the Exchequer what is his estimate of the percentage increase in the(a) GDP deflator and (b) headline retail prices index in each year from 1986–87 to 1997–98; and if he will make a statement. [24742]
§ Mrs. Liddell[holding reply 23 January 1998]: Annual average inflation rates for the GDP deflator and the headline retail price index (RPI) are shown in the table. The table also shows figures for the RPI excluding mortgage interest payments (RPI ex MIPs), which is the Government's target measure.
Annual average inflation rates for financial years Percentage change on previous financial year Financial year GDP deflator Headline RPI RPI ex MIPs 1986–87 3.0 3.2 3.4 1987–88 5.3 4.0 3.7 1988–89 6.7 6.0 5.1 1989–90 7.0 7.8 6.0 1990–91 8.0 9.7 8.7 1991–92 6.4 4.8 6.1 1992–93 4.2 3.1 4.1 1993–94 2.9 1.7 28.8 1994–95 1.5 2.7 2.4 1995–96 2.7 3.3 2.8 1996–97 2.8 2.4 3.0 Forecast 1997–98 12.75 23.6 2.75 1 Pre-Budget Report forecast. 2 Calendar year 1997. The Government do not publish forecast for the headline RPI. For the Pre-Budget Report, the National Audit Office audited the consistency of the assumptions for a range of price indices, including the GDP deflator and the headline RPI, with the projected path for RPI ex MIPs. The Auditory General and Comptroller concluded:
There is a reasonable consistency between the assumed trends in the indices, subject to the inevitable uncertainty of projecting relative price movements.