Issue date: 27 December 2012
Type: Letter to the Press
In his article, "Pensioners are about to be robbed yet again" (page 25, 27 December 2012), Philip Johnston argues that the National Statistician's consultation on potential changes to the retail prices index (RPI) was not very well publicised. This is not the case. ONS made extensive efforts to ensure that the consultation was brought to the attention of as many people as possible. It used a range of methods, including direct email, open public meetings (in London, Edinburgh, Cardiff and Belfast), presentations to financial and actuarial professionals, messaging via Twitter and Facebook, use of the RPI/CPI user group website and direct contact with the media. These efforts meant the consultation received significant media coverage, including in your own newspaper, when it was first announced, on 18 September, when the consultation period started on 8 October and throughout the time it was open.
The consultation generated more than 400 responses and in light of those the National Statistician will announce her recommendation on whether any changes to the RPI are required or not at 07:00 on 10 January 2013. If necessary, the recommendation will be sent to the Bank of England and then the Chancellor of the Exchequer for their consideration. Further details, which have also been published via a range of media, can be found on the ONS website (http://www.ons.gov.uk/ons/media-centre/statements/operational-note-timetable-for-options-for-improving-the-rpi-consultation/index.html).
Secondly, you note that the Consumer Prices Index (CPI) excludes housing costs. This is incorrect as many such costs, including rent and energy bills, are included in the CPI. Many owner occupiers' costs are currently excluded though this will be addressed in March 2013, when ONS will publish a new additional measure of consumer price inflation that includes a measure of owner occupiers' housing costs. This measure will be initially known as CPIH and has been developed to respond to user needs.
Head of Prices Division