ONS campaign to take hot air out of inflation talk

ONS campaign to take hot air out of inflation talk

The Office for National Statistics is to launch a campaign aimed at persuading people that inflation is not higher than its various measures show, including an online calculator on which they can calculate their personal inflation rate.

Some newspapers have reported that ONS data does not adequately reflect typical family outgoings such as rising energy bills or council tax and that the real rate of inflation is closer to 10% than the 3%-4% the ONS numbers suggest. But experts dismiss this argument.

The ONS will release an information pack providing better information on how it calculates inflation.

National statistician Karen Dunnell said: "People often ask why the national inflation figures, which we publish every month, do not seem to correspond with their own experience.

"There are a number of reasons. The most important is that the national inflation figures are based on average spending patterns. But every household is different, and the way inflation affects them depends on how they spend their money."

The information pack is part of the first issue of ONS's new journal, Economic and Labour Market Review, to be published on January 15. It will include an online personal inflation calculator that will indicate whether a household's inflation is higher or lower than the national figures.

There will also be an article using new analysis to explain why individuals' experience and perceptions of inflation may differ from.....continued below

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the national figures and from each other, and information on how to analyse the monthly inflation figures.

Recent research by consultancy Capital Economics showed that a young person living at home, buying primarily clothes and electronic gadgets such as iPods may have a negative rate of inflation.

A pensioner living in a large house, facing rising energy bills may see inflation rates as high as 9%.

Capital said it had no problem with the ONS inflation numbers, pointing out that there is currently an unusually wide variation around the average.

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