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What is the future of the retail price index as a measure of inflation?

The House of Lords Economic Affairs Committee, chaired by Lord Forsyth of Drumlean, today invites written contributions to its investigation into whether the retail price index (RPI) is an appropriate measure of inflation in the UK, and its use by the Government.

The Committee is seeking answers to the following questions:

  • The current situation regarding the retail price index is untenable. Do you agree? If so, what would you recommend is done to improve this situation?
  • Should the retail price index be abolished? If so, how should that be achieved?
  • If not, how should the retail price index be changed? If so, how should that be achieved?
  • What would the implications be of changing or abolishing the retail price index?

Lord Forsyth of Drumlean, Chairman of the Economic Affairs Committee, said:

“How, and when, the retail price index is used by the Government and others affects most people. Its use in train fares, student loans and utility bills means that we must all be confident in it as a measure of the increasing cost of living.

“After the Governor of the Bank of England told us that the Government should consider not embedding RPI further into contracts and transition away from RPI-linked gilts, we have launched this inquiry to see what the implications and consequence of such a move might be.

“We encourage, and welcome, submissions of written evidence from anyone who has a view on this issue.”

The deadline for the submission of written evidence is 25 July 2018.

Click here to read the call for evidence and find out how to submit evidence.

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