A consultation on the Reform to Retail Prices Index (RPI) Methodology
Download the full outcome
Detail of outcome
The government and UK Statistics Authority (UKSA) have published the response to their joint consultation on the timing of the reform to the Retail Prices Index (RPI). As announced in September 2019, UKSA intends to bring the methods and data sources of the Consumer Prices Index including owner occupiers’ housing costs (CPIH) into RPI. Owing to the use of RPI in two specific index-linked gilts, this proposal would require the consent of the Chancellor if it were to be implemented before 2030.
The Chancellor has announced that while he sees the statistical arguments of UKSA’s intended approach to reform, in order to minimise the impact of reform on the holders of index-linked gilts, he will be unable to offer his consent to the implementation of such a proposal before the maturity of the final specific index-linked gilt in 2030.
It is UKSA policy to address the shortcomings of RPI in full at the earliest practical time. The change proposed can legally and practically be made by UKSA in February 2030.
The government and UKSA published the response to the consultation alongside the Spending Review on 25 November 2020. See below for the consultation response document and an exchange of letters between the Chancellor, the UKSA Chair, the Governor of the Bank of England, and the Deputy Governor for Monetary Policy of the Bank of England, which details the outcome of the consultation.
The responses to the consultation have now been published (on 28 January 2021). The responses can be found in the zip file above.
Certain aspects of the proposed reform to the Retail Prices Index, the consultation, and the joint response were the subject of judicial review proceedings which were dismissed in a judgment given on 1 September 2022. Permission to appeal the judgment was refused by the High Court and no permission to appeal was sought from the Court of Appeal. Accordingly, this judgment is now final.
Original consultation
Consultation description
The consultation covers, among other things, the issue of timing, including whether UKSA’s proposal might be implemented at a date other than 2030 and, if so, when between 2025 and 2030, and issues on technical matters concerning the implementation of the proposal.
The consultation was launched at Budget on 11 March. It was scheduled to close on 22 April, however, owing to the coronavirus (COVID-19) pandemic, the consultation period was extended until 21 August.
On 9 November, the government and UKSA announced that they will publish their response to the consultation alongside the Spending Review on 25 November. The government and the UKSA has responded the consultation.
Documents
Last updated 26 September 2022 + show all updates
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Permission to appeal the judgment was refused by the High Court and no permission to appeal was sought from the Court of Appeal. Accordingly, this judgment is now final.
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Updated with the court judgment on the judicial review
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Certain aspects of the proposed reform to the Retail Prices Index, the consultation, and the joint response are the subject of ongoing formal judicial review proceedings
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Updated with additional responses.
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Responses to the consultation published.
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Updated with a series of letters. Updated with consultation response document.
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Updating consultation with 'closed' message.
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Updated with consultation extension information.
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First published.