Inflation measure shake-up amid Jack Monroe row

Food poverty campaigner and chef Jack Monroe is claiming victory after statistics chiefs pledged to revise how they measure the cost of living.

Ms Monroe had complained that everyday essentials were going up in price by more than the official inflation rate, hitting poorer people hardest.

But she said the official way inflation is calculated failed to reflect this.

On Wednesday, the Office for National Statistics admitted that “one inflation rate doesn’t fit all”.

“Delighted to be able to tell you that the ONS have just announced that they are going to be changing the way they collect and report on the cost of food prices and inflation to take into consideration a wider range of income levels and household circumstances,” Ms Monroe said in a tweet.

Earlier, she told the BBC: “People who are buying the 29p pasta, the 17p kidney beans, the 45p bags of rice – those statistics don’t exist, so those people aren’t represented.”

That followed a series of tweets in which she highlighted budget supermarket lines being discontinued.

The ONS is understood to have been working on a way of broadening its measure of inflation for some time.

In a blog, head of inflation statistics Mike Hardie said: “We are currently developing radical new plans to increase the number of price points dramatically each month from 180,000 to hundreds of millions, using prices sent to us directly from supermarket checkouts.

“This will mean we won’t just include one apple in a shop – picked to be representative based on shelf space and market intelligence – but how much every apple costs, and how many of each type were purchased, in many more shops in every area of the country.”

Jack Monroe is right that a big increase in the price of the cheapest pasta or the cheapest rice in a store may not be being reflected in the official inflation figures.

Here’s why: the ONS sends shoppers to stores around the country to check prices. They go to the big supermarkets, as well as discount retailers such as Aldi and Lidl, and corner shops. The use of Aldi and Lidl are particularly important because some of the bigger chains price-check against them.

If the item that the shopper bought the previous month has been discontinued, they will look for a replacement product of a similar quality. So, for example, if Morrisons stopped stocking a particular brand of spaghetti, which the shopper had bought last month, they would try to replace it with a similar product.

“However, if there were a change in quality, for example, from a value brand to premium brand, or from own brand to branded, then we would break the price chain,” they told Reality Check, which means that they would buy a different product but not include the change in price in the inflation calculation.

So a shopper looking for the cheapest spaghetti could face a big price increase that would not show up in the statistics.

The ONS said it had no plans to carry out research on spending patterns of different income groups, but the changes would offer a much more accurate reflection of overall price rises.

It added that it was in the process of working out how to incorporate supermarket checkout data into the official statistics.

This would take place over the next year or so, with no official timetable for the changes.