§ Mr. Ralph Howellasked the secretary of Employment if he will show how the retail price index is calculated; what items are included; and how they are weighted.
130W
§ Mr. GoldingThe calculation of the retail price index is essentially as described in the HMSO publication "Studies in Official Statistics No. 18 Method of Construction and Calculation of the Index of Retail Prices", which is available in the Library of the House. A less technical and more up-to-date description is given on pages 971 to 978 of the October 1975 issue of the Department of Employment Gazette.
The index covers practically the whole range of goods and services purchased by households with the exception of a few items, notably income tax, savings, pension contributions, and the capital element of mortgage payments which, on the advice of the Retail Prices Index Advisory Committee, are considered to be outside the scope of the index.
The weights for the index reflect the average spending pattern of the great majority of households as shown by the Family Expenditure Survey. They are revised each January and are usually published in the March issue of the Department of Employment Gazette.