The UK Statistics Authority has today published Paul Johnson’s independent review of UK consumer prices statistics in which he strongly suggests that the UK should drop the Consumer Price Index (CPI) in favour of a measure which includes owner occupiers’ housing costs and should drop the Retail Price Index altogether.

The Consumer Price Index (CPI) is the official measure of inflation of consumer prices in the UK it superseded the Retail Price Index as a general measure, although it is still used to calculate the value of many benefits and pay bargaining.

In hid report, Mr Johnson said that he agrees with the view set out by the National Statistician that there are basic statistical flaws in the construction of the Retail Prices Index (RPI) and that the RPI is “not a good measure of inflation”.

Speaking today, Paul Johnson said: “In 2013, the UK Statistics Authority de-designated the RPI as a National Statistic and the Office for National Statistics introduced the new CPIH measure to include owner occupiers’ housing costs. In my view, it is time for the UK government to take the next, logical step and stop using RPI in any element of the tax, benefit and regulatory systems.

“I would also like to invite the Authority to consider how it might support better statistical measures of household inflation. Different population groups – the young and the old, families and individuals, home-owners and renters – have different spending patterns and hence face different rates of inflation. An annual publication.”