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Is the retail price index an “inadequate measure” of inflation?


How different is the inflation faced by pensioners to the inflation faced by working people? Should the Government stop using the retail price index (RPI) to increase rail fares and calculate the interest rate on student loans? Does the Government opt for RPI or consumer prices index (CPI) depending upon whether it is spending or receiving money?

These are some of the questions the House of Lords Economic Affairs Committee will be putting to a panel of witnesses on Tuesday 19 June 2018 as it continues its inquiry into the use of RPI.

The Committee, at 3.35pm, will hear from:

  • Dr Geoff Tily, Senior Economist, Trades Union Congress
  • David Lloyd, Head of Institutional Portfolio Management, M&G
  • Simon Briscoe, consultant on statistical matters.

Other questions the Committee is likely to cover in this public evidence session include:

  • Could a change of methodology of RPI to the consumer prices index including owner occupiers' housing costs (CPIH) prevent its abolition?
  • Public sector pension schemes and the state pension are uprated by CPI and most private pension schemes by RPI, is this confusing for people?
  • Did the change to clothing price collection in 2010 create an undeserved windfall for holders of index-linked gilts?
  • What sort of transition period would be needed if RPI was to be phased out for index-linked gilts?
  • The Economic Affairs Committee's short inquiry into the use of RPI will conclude before the summer recess.

This evidence session will start at 3.35pm on Tuesday 19 June in Committee Room 1 of the House of Lords.

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