§ Dr. George TurnerTo ask the Chancellor of the Exchequer (1) if he will list for the period which determined the changes in the rate of the state pension, the annual movement in(a) the RPI and (b) the Pensioner Price Indices in each of the last five years; [140671]
(2) when the items included in the Pensioner Price Indices were last reviewed; [140672]
950W(3) what steps he has taken to ensure that the items included within the Pensioner Price Indices reflect the needs of the average pensioner. [140673]
§ Miss Melanie JohnsonThe information requested falls within the responsibility of the National Statistician. I have asked him to reply.
Letter from Len Cook to Mr. George Turner, dated 30 November 2000:
As National Statistician, I have been asked to reply to your three recent questions asking:
- 1) for the annual movement in (a) the RPI and (b) the Pensioner Price Indices in each of the last five years, for the period which determined the changes in the rate of the state pension;
- 2) when items included in the Pensioner Price Indices were last reviewed; and
- 3) what steps have been taken to ensure that the items included within the Pensioner Price Indices reflect the needs of the average pensioner.
In response to question one, it is the annual percentage increase in the September RPI that is used to uprate state pensions. The Pensioner Prices Indices are only published quarterly so I have chosen to list figures for the third quarter, that is the quarter July to September. Pensioner Indices are only calculated for one person pensioner households and two person pensioner households.
Percentage annual increase in RPI One pensioner Household Two pensioner Household Year ending September to September Q3-Q3 Q3-Q3 1996 2.1 2.2 2.5 1997 3.6 1.0 1.6 1998 3.2 1.3 1.6 1999 1.1 1.4 1.5 2000 3.3 1.1 1.5 In response to question two, the items contained in the basket of goods, which is used to calculate both the RPI and the Pensioner Price Indices are reviewed annually.
In answer to your third question, the Pensioner Price Indices relate to pensioner households whose income is mainly (at least 75%) dependent on state benefit. The Pensioner Price Indices are effectively a subset of the RPI as the same price data is used to produce both, however the Pensioner Price Indices exclude certain items that the RPI includes, such as housing costs, school meals and NHS prescription charges. For items where pensioners receive special rates (such as rail and bus fares), we produce special pensioner indices that differ from those in the RPI. In addition, there are various items and sections where pensioner expenditure patterns differ greatly from those used in the RPI—these include milk, soft drinks, footwear, fees and subscriptions, takeaways, T.V. licences, beer and wine sales (both 'on' and `off), tobacco, domestic services, chemists' goods, maintenance of motor vehicles, and books and newspapers. The weights used to construct the Pensioner Price Indices are therefore adjusted accordingly to take these different spending patterns into account.
§ Dr. George TurnerTo ask the Chancellor of the Exchequer what(a) representations and (b) consultations he has had on the Pensioner Price Indices. [140674]
§ Miss Melanie JohnsonNone.