FOI Reference: FOI/2022/4036
You asked
Please inform me how UK inflation / cost of living, and associated indices have been calculated / and specifically what has been changed regarding the measurements or definitions since 1990 - hence which changes have been made, and when.
Which indices are used to calculate UK government index linked pensions?
How have the indices been changed over time, specifically?
What items have been included in the inflation index calculations and when?
What items have been removed from the index calculations and when?
What items have been changed in the index calculations and when?
How have the weightings changed for key items such as housing (purchase and rental) and energy?
We said
Thank you for your query about how UK inflation is calculated and changes to the items that are used in its measurement.
An overall description of how the inflation figures are calculated is available in three main documents – Consumer price indices, a brief guide gives an overview of consumer price statistics, the Consumer Price Indices Technical Manual covers the concepts and methodologies in more detail and the CPIH Compendium provides a comprehensive source of information on owner occupiers' housing costs as measured in the Consumer Prices Index including owner occupiers' housing costs (CPIH). Appendix 1 of the Technical Manual gives a broad history of the changes made regarding the measurement of inflation. Articles on individual changes are available on the Inflation and price indices page of our website.
UK government index linked pensions are a matter for HM Treasury. If you are referring to public service pensions, then they are uprated by the Consumer Prices Index (CPI). If you mean the state pension, then Benefits Uprating 2022/23 confirms that is also uprated using the CPI. In recent years, the CPI has been one of three measures used as part of a "triple lock" where state pensions were raised by the highest of earnings or price increases, or 2.5%. In 2022/23, the earnings element has been suspended.
The best guide to the changes in the list of items used for measuring inflation are the sequence of articles describing the basket update each year. The changes are described in the "Changes to the baskets" section of the articles and tables 2 and 3. The updates for 2017 to 2022 are available on our live website and earlier articles back to 1947 are stored in the national archives.
You also asked about changes to the weights for key items such as housing (purchase and rental) and energy. The CPI weights for recent years (from 2008) are included in table 25 of our monthly reference tables. The CPIH and Retail Prices Index (RPI) weights are in tables 11 and 44. If you want longer time series, the easiest approach is to take the 4-character identifier for the relevant series on the left of the table and enter that in the search bar at the top of the ONS website pages.
For example, the identifier for electricity, gas and other fuels in the CPI is CJVF resulting in this time series. House purchase is not included in the inflation measures since this is considered in part to be an investment so is excluded by international rules and guides from consumer price inflation. Rents are included in all three measures. The costs of owning, maintaining and living in one's own home are in CPIH (see the compendium above for more information) while RPI includes mortgage interest payments and house depreciation (see chapter 11 of the technical manual above).