MPC Policy Inflation Calculator

hallmark

Anybody ever tried using this?

https://www.bankofengland.co.uk/monetary-policy/inflation/inflation-calculator

Out of curiosity I just checked what I used to pay for Council tax, gas, electricity, water, BB, & mobile in 2013 vs today.   Same house, same stuff (i.e. I don't now pay for a more fancy mobile service or whatever)

In 2013 those items cost me £492/month.  According to the estimable BOE that means they should now cost £679.  However in reality they currently cost £892 meaning the BOE is massively  understating inflation.

Be interested to see how the reality of other people's bills matches what the BOE claim is inflation over the last decade or so?

masonic

Looks like it only supports CPI. For me it is overestimating my personal inflation rate over the longer term, but underestimating it over the past few years.

phlebas192

hallmark said:

Anybody ever tried using this?

https://www.bankofengland.co.uk/monetary-policy/inflation/inflation-calculator

Out of curiosity I just checked what I used to pay for Council tax, gas, electricity, water, BB, & mobile in 2013 vs today.   Same house, same stuff (i.e. I don't now pay for a more fancy mobile service or whatever)

In 2013 those items cost me £492/month.  According to the estimable BOE that means they should now cost £679.  However in reality they currently cost £892 meaning the BOE is massively  understating inflation.

Be interested to see how the reality of other people's bills matches what the BOE claim is inflation over the last decade or so?

First off, the BOE doesn't calculate inflation, that's the ONS and the BOE are just using their figures so blame the ONS if you think they are wrong! But more importantly, the official inflation rate is based on a lot more factors than just those items. It is based on a basket of goods which is designed to cover the 'average' spending of a 'typical' household. So that includes new phones, TVs, other appliances, groceries, holidays, subscriptions, eating out, cinema tickets, nursery costs, and many, many other items. It also includes some pretty weird stuff (eg when I last checked it a few years ago it included an amount for replacing a hall lampshade once ever 5 years or so!).

It's also important to remember that unless your individual expenditure happens to match that of the basket used by the ONS (unlikely!) then your personal inflation rate can be rather different than the official one. For some it will be rather higher, for others it will be lower - and it can be quite an extreme difference. An obvious difference would be for those with or without children.

From eyeballing a graph of our own expenditure, we had a household inflation rate of essentially zero between 2003 and 2021. Hard to tell for the period since then (due to large, irregular expenditures) but I suspect it's been a bit higher than the official rate.

Linton

I suggest you look at other expenses,  The BOE calculator figures give roughly 40% rise in costs beteen 2013 and now.  For example our grocery+wine costs have remained pretty constant as has car insurance.

Eyeful

I think you will find, the nearest inflation index to the old RPI is called CPIH. They like to quote current CPI as it is normally less than the current CPIH.