§ Lord Jacobsasked Her Majesty's Government:
What was the change in the RPIX for the month of June compared with the previous 12 months; and what would be the figure if it were to be calculated on an inflation formula similar to that in other Common Market countries. [HL5169]
§ Lord McIntosh of HaringeyThe information requested falls within the responsibility of the National Statistician, who has been asked to reply.
Letter from the National Statistician, Len Cook, dated July 2002.
As National Statistician I have been asked to reply to your recent question in which you asked what was the change in the RPIX for the month of June compared with the previous 12 months; and what would be the figure if it were to be calculated on an inflation formula similar to that in other Common Market countries. [HL5169]
The twelve month percentage change in the RPIX for the month of June 2002 is 1.5 per cent.
The Harmonised Indices of Consumer Price Indices (HICPs) are calculated in each member state of the European Union for the purposes of European comparison, as required by the Maastricht Treaty. The twelve month percentage change in the UK HICP for the month of June 2002 is 0.6 per cent.
The latest Consumer Price Indices can be found on the National Statistics website www.statistics.gov.uk under Latest Economic Indicators.
§ Lord Jacobsasked Her Majesty's Government:
What are the most significant differences in the manner in which the continental inflation rate is calculated as compared with the RPIX. [HL5170]
§ Lord McIntosh of HaringeyThe information requested falls within the responsibility of the National Statistician, who has been asked to reply.
Letter from the National Statistician, Len Cook, dated July 2002.
As National Statistician I have been asked to reply to your Parliamentary Question on the most significant differences between the calculation of the continental inflation index and the Retail Prices Index excluding mortgage interest payments (RPIX). [HL5170]
Eurostat, the statistical office of the European Commission, calculates the Harmonised Index of Consumer Prices (HICP) for the European Union as a whole, and for the Member States of the Euro area. It is compiled from individual HICPs calculated by each EU Member State. The HICP is the measure of inflation used by the European Central Bank for monitoring price stability within the Euro area.
157WAThe rules underlying the construction of the HICP are specified in a series of European Regulations. While the methodology of the HICP is similar to that of RPIX in a number of respects, it differs in the following ways:
Method of Aggregation: The HICP uses the geometric mean to aggregate prices at the most basic level whereas RPIX uses arithmetic means.
Weights: the weights underlying the HICP are based on the expenditure of all private households in the UK, foreign visitors to the UK, and residents of institutional households. RPIX weights are restricted to the expenditure of private households, excluding the richest four per cent, and pensioner households largely dependent on state benefits. Also expenditure on insurance is treated differently when constructing weights. For construction of the RPIX weights, expenditure is assigned to the relevant insurance heading. However, for the HICP weights, the amount paid out in insurance claims is distributed amongst the Classification of Individual Consumption by Purpose (COICOP) headings according to the nature of the claims expenditure,
Difference between annual rates HICP-RPIX Breakdown of differences (unrounded figures) rounded figures unrounded figures housing components excluded from HICP other differences in coverage of goods and services Formula effect coverage of weights 2002 March -0.8 -0.73 -0.40 0.09 -0.42 0.01 April -1.0 -0.96 -0.52 -0.02 -0.42 0.01 May -1.0 -0.96 -0.62 0.01 -0.42 0.07 1 Difference due to use of different formulae to aggregate prices at the most basic level.
§ Lord Jacobsasked Her Majesty's Government:
What would be the change in the RPIX for the months of December 1998, 1999, 2001 and June 2002 compared with the previous 12 months if the depreciation of owner occupied houses which has been a component of the index since 1995 were to be excluded from 1 January 1998; and how this compares with the RPIX of the relevant months. [HL5171]
§ Lord McIntosh of HaringeyThe information requested falls within the responsibility of the National Statistician, who has been asked to reply.
Letter from the National Statistician, Len Cook, dated July 2002.
As National Statistican I have been asked to reply to your recent question in which you asked what would be the change in the RPIX for the months of December 1998. 1999, 2001 and June 2002 compared with the previous 12 months if the depreciation of owner occupied houses were to be excluded from 1 January 1998; and how this compares with the RPIX of the relevant months. [HL5171]
158WAwith the residual (service charge) being allocated to the relevant insurance heading.
Classification: The coverage of the HICP is based on the international classification system, COICOP. RPIX uses a bespoke classification system developed for the RPI.
Coverage of items: A number of series used for RPIX are excluded from the HICP, most notably those mainly relating to owner-occupiers' housing costs e.g. Council Tax, depreciation, buildings insurance. In addition the HICP includes series which are not currently included in RPIX. These include, air fares, university accommodation fees and unit trust and stockbrokers charges. In addition, the index for new cars in RPIX is imputed from movements in second hand car prices, whereas the HICP uses a quality adjusted index based on published prices of new cars.
Further details of the HICP are given in a series of Economic Trends articles available on the National Statistics Website: www.statistic.gov.uk/HICP.
Each month, the ONE publishes in the Consumer Prices First release a numerical breakdown of the differences between the HICP and RPIX. Below is the breakdown of differences as published in the May First release.
These figures are provided in the following table:
Percentage change over 12 months RPIX RPIX excluding depreciation Dec 1998 2.6 2.4 Dec 1999 2.2 1.9 Dec 2001 1.9 1.7 Jun 2002 1.5 1.1 These figures are published each month in table 2 of the Consumer Price Indices First Release and on the National Statistics Website www.statistics.gov.uk.