New Inflation Rates - July 2016

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Head Office Circular No. NP/187/16

To the Secretary, all Branches and Regional Councils
Tuesday 19 July 2016

Dear Colleagues

STERLING DOWN c15% FROM RECENT HIGH (meaning imports dearer)

The Retail Prices Index (RPI) was 1.6% for the year to June 2016, up from 1.4% for the year to May 2016.

Some employers/ government agencies have attempted to sideline RPI, instead pushing other measures of inflation – such as CPI (0.5% for the year to June 2016) or CPIH (0.8% for the year to June 2016). Both CPI and CPIH are inappropriate for use in settling pay claims. This is because they are designed for comparing different countries’ economic performance, rather than average workers’ costs. Further, CPI/CPIH tend to be less responsive than RPI to changes in the cost of living.

 Inflation July 16

Attempts by an employer to link pay awards to CPI or CPIH must be resisted and logged with the Policy Department.

Additional information will follow in the Pay Bulletin presently.

Yours sincerely,


Mick Cash
General Secretary