This morning has seen a report published suggesting that here is a strong case for abandoning CPI as the headline measure of inflation, according to Institute for Fiscal Studies head Paul Johnson.
He was commissioned to review the measures of inflation for the UK Statistics Authority and suggests replacing CPI with CPIH, a measure that includes owner occupiers’ housing costs and also suggests that the government should move away from using RPI for any reason as soon as possible.
His recommendations are not binding and both CPI and CPIH have been been at the same level since August. The UKSA says it will undertake a full consultation this summer with a final response by year-end
Johnson wrote:
In 2013 the UKSA de-designated the RPI as a National Statistic and the ONS introduced the new CPIH measure to include owner occupiers’ housing costs. In my view it is time for the UK govt to take the next logical step and stop using RPI in any element of the tax, benefit and regulatory systems
Read the full review here
