REVISION OF CONSUMERS PRICE INDEX 1974

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Supplement to April 1975, Monthly Abstract of Statistics REVISION OF CONSUMERS PRICE INDEX 1974 NOTE: Salient points of the information contained in this supplement were contained in news releases

1 Supplement to April 1975, Monthly Abstract of Statistics REVISION OF CONSUMERS PRICE INDEX 1974 NOTE: Salient points of the information contained in this supplement were contained in news releases issued by the Department of Statistics on 13 February 1975 and 12 April A new Consumers Price Index is now operative following the completion by the Department of Statistics of research into expenditure patterns of households and the collection of base prices. This index has an expression base of the calendar year 1974 (-1000) (i.e. each current index number compares the general level of prices in the current month or quarter with the average level of prices over the year 1974 for the same grouping of priced items). The relative significance of an individual item is determined by the expenditure weight assigned to it relative to expenditure weights assigned to other items in the regimen of the index. weights were calculated from information on average spending patterns of households for the 12 months ended 30 June 1974 updated for changes in average prices of items as between the 12 months ended 30 June 1974 and the 12 months ended 31 December The information on average spending patterns was obtained primarily from a Household Sample Survey conducted by the Department. The previous index, on base 1965 (=1000), measured price movements up to the end of 1974 and has now been discontinued. The first quarterly All Groups index number on the new (1974 =1000) base is that for the quarter ended March This is 1097 and indicates that the general level of prices for that quarter was 9.7 percent higher than it was, on average, over the 12 months ended December This new index contains some important changes in concept and coverage compared with the index it has replaced and in this it follows the recommendations of the Consumers Price Index Revision Advisory Committee. The wide ranging changes in concepts, methods and expenditure patterns introduced by the new index produce a break in coraparability between the new and old series. Although this problem was always present in the past its significance was minimal since successive index constructions differed only in a relatively minor way. To eliminate the quarter to quarter discontinuity in the new index which would have been produced by annual linking, the new index has been linked to the old through the last quarter of 1974 for which quarter both the old and new index numbers were computed and put on a common denominator. On the basis of this linked quarter series consumer prices increased by 3.1 percent between the fourth quarter of 1974 and the first quarter of 1975 and by 13.2 percent between the March quarters of 1974 and Background to Revision The Government appointed a Consumers Price Index Revision Advisory Committee in June 1971 to report on requirements for a new index. Members of the Committee represented the Federations of Employers, Farmers, Labour and Retailers, and the Combined State Organisation, the Consumer Council, the National Council of Women, and academic and statistical experts. The Committee made a number of recommendations, some of them confirming existing practices, others recommending basic conceptual changes and improvements in statistical procedures and methods. Major features of the Committee's report were that: the weighting for the new index be based on the expenditures of all people living in private households, rather than, as are the 1965 and earlier based indexes, on their actual or notional consumption. there be more frequent revisions of the index, with the institution of a Household Sample Survey to obtain more accurate information on expenditures from the households themselves. expenditure involved in the purchase of all forms of housing be the basis on which owner-occupied housing is included in the new index rather than the previous approach which was based on a notional rental value. the extension of items priced in the new index include new fields of expenditure such as air fares, the con? sumption of certain alcoholic beverages, holiday expenditure and package holiday tours. the index should not include expenditure on certain items such as those to which no price can be attached (contributions to charity, etc.); items where it was impossible to specify the good or service unambiguously (collectors items, legal expenses in court proceedings); investments in securities; and all forms of direct taxation. Also by definition no expenditure was to be attributed to home-grown foods other than the cost of materials incurred in producing them. All of the Committee's main recommendations have been incorporated in the new Consumers Price Index. The full report on the new Index, being prepared, will give details of the regimen and compilation methods but some points are covered briefly now.

Price Collection 2 Prices used in the old All Centres combined index were collected in 25 market centres (Wellington-Hutt and Napier-Hastings, respectively, each being regarded as single centres) and

2 Price Collection 2 Prices used in the old All Centres combined index were collected in 25 market centres (Wellington-Hutt and Napier-Hastings, respectively, each being regarded as single centres) and indexes were published for 14 market centres. The Consumers Price Index Revision Advisory Committee laid down as guideline that prices should be collected in all urban areas with the status of cities, in all large towns (i.e. over 10,000 population), a representative range of intermediate towns (i.e. 5,000-10,000 population), and a small representative range of small towns (i.e. 2,500 to 5,000 population). To better meet these guidelines, pricing of food for the revised index is undertaken in Tokoroa and Taupo. These market centres replace Thames and Oamaru for which prices were collected for the old index. The new index series will thus continue to incorporate prices from twenty five centres and will have indexes for: Each of the seven chief market centres (Auckland,. Hamilton, Napier-Hastings, Palmerston North, Wellington- Hutt, Christchurch, Dunedin). All seven chief market centres combined. Each of the ten larger market centres (Whangarei, Tauranga, Rotorua, Gisborne, New Plymouth, Wanganui, Masterton, Nelson, Timaru, Invercargill). All ten larger market centres combined. New Zealand as a whole [jwenty-five market centres combined (i.e. those listed above and Tokoroa, Whakatane, Taupo, Hawera, Blenheim, Greymouth, Ashburton, and Gore)]. All Food Group In the weighting base for the old index (1965) food represented 3 percent of the total index expenditure whereas in the base of the new index (1974) it represents a significantly lower percentage percent. For the new index 145 items are being priced monthly or weekly for the All Food Group against 125 for the old index. Additions include dehydrated peas, additional cuts of beef and sheep meats (including lamb), fresh shellfish, yoghurt, cakemix, animal and vegetable fats and oils, frozen fruit pie, instant pudding, margarine, ice blocks, potato chips, and take-aways. Bananas and oranges have been transferred to the seasonal basket of fruit and vegetables and the distinction between hothouse and outdoor tomatoes has been discontinued since they are frequently indistinguishable in the shop. As the prices and availability of eggs are now virtually non-seasonal, seasonal adjustments have been discontinued for this item. Tables 1 and 2 attached set out the regimen of the revised Index and Table 3 compares the expenditure weighting of the revised Index with that of its predecessor. Department of Statistics, Wellington, April 1975., E.A. HARRIS Government Statistician TABLE 1 1. FOOD (a) Fruit arid Vegetables (I) Seasonal Fruit and Vegetables (see table 2) Total, Seasonal Fruit and Vegetables (it) Processed Fruit. Apricots, dried Dates Peaches, canned Pineapple, canned Sultanas Total, Processed Fruit (Hi) Processed Canned Frozen Dehydrated.. Vegetables Total, Processed Vegetables Total, Fruit and Vegetables (b) Meat, Fish, and Poultry (i) Meat Beef and Veal Beef, blade steak Beef, corned Beef, porterhouse steak Beef, prime rib, rolled Beef, rump steak Beef, topside Wiener schnitzel Total, Beef and Veal Hogget and Lamb Hogget, chops, forequarter Hogget, chops, midioin Hogget, cut leg, knuckle end Hogget, forequauer.. Lamb, leg, whole Total, Hogget and Lamb Pork Pork, cut leg, knuckle end Pork, loin chops, Total, Pork (ii) (Hi) REGIMEN OF CONSUMERS PRICE INDEX, 1974(i) Weight's) Smallgoods and Prepared Meats Bacon Ham, cooked, pressed, sliced.. Luncheon sausage Liver, sheep's Meat mince, seasoned, frozen.. Mince, beef Sausages.. Saveloys.. Canned meat Fish Sole or flounder, wet.. Wet fish, other Smoked fish Shellfish, opened Salmon, canned Sardines, canned Fish fingers, frozen Total, Fish Poultry Chicken, roaster, frozen Total, Meat, Fish, and Poultry Total, Smallgoods and Prepared Meats 1.27 Total, Meat (c) Other Foods (i) Eggs Total, Eggs (ii) Dairy Products Milk, delivered Cream, delivered Butter Cheese Yoghurt Condensed milk Milk powder, full cream Total, Dairy Products (Hi) Cereals and Cereal Products Breads, Biscuits, and Cakes Breads Biscuits Cakes Total, Breads, Biscuits, and Cakes Other Cereals and Cereal Products Breakfast flake biscuits Cake mix.. Cornflour, packaged Flour, white Oatmeal, packaged Rice Total, Other Cereals and Cereal Products Total, Cereals and Cereal Products (Iv) Jams and Spreads Honey Jam Marmalade.. Peanut butter Vegetable extract Total, Jams and Spreads (v) Beverages Cocoa Coffee, instant Coffee, packaged, ground Proprietary drink, granulated Tea Total, Beverages (vi) Other Grocery Foods Baking powder Cooking fats and oils.. Fruit pie, frozen Instant pudding Jelly crystals Margarine, table Pepper, white Salt, iodised Sauce, tomato Soup, canned Soup powder Spaghetti, canned Sugar, white Vinegar Total, Other Grocery Foods (vii) Soft Drinks, Fruit Juice, and Ices Aerated waters Fruit extracts and cordials Fruit juice, pure Ice block Ice cream Total, Soft Drinks, Fruit Juice, and Ices Fxpenriiture Weightta C

4 TABLE 1 REGIMEN OF CONSUMERS PRICE INDEX. 1974U)- continued Grouping aid Commodity or Service 1. FOOD continued (viii) Sweets, Potato Chips, Peanuts Chocolate block.

3 4 TABLE 1 REGIMEN OF CONSUMERS PRICE INDEX. 1974U)- continued Grouping aid Commodity or Service 1. FOOD continued (viii) Sweets, Potato Chips, Peanuts Chocolate block..... Chocolates Peanuts, salted Potato chips Toffees Total, Sweets, Potato Chips, Peanuts (ix) Meals Away From Home Grill, grill-room Lunch, cafe Snack, coffee-bar Total, Meals Away From Home (x) Take Aways Chicken, cooked, hot Fish, fried, hot Hamburger, hot Pie, meat, hot Sandwich.. Total, Take Aways Total, Other Foods 2. HOUSING (a) Rentals TOTAL, ALL FOODS (i) State and Municipal Dwelling Rentals Houses Total, State and Municipal Reiitciis.. (ii) Other Dwelling Rentals Houses Flats Total, Other Dwelling Total, Rentals (b) Home Ownership Rentals Dwelling (i) Purchase ol Dwellings Previously-occupied house Previously-occupied flat Newly-erected house.. Newly-erected flat Section Erection of dwelling (including additions and alterations to existing dwellings) Total, Purchase of Dwellings.. (ii) Expenses of Purchase and Financing of Ownership of Dwellings Specialists' fees and stamp duty Interest on mortgage, mortgage repayment insurance, and contribution t& Housing Corporation Reserve Fund Total, Expenses of Purchase and Financing of Ov/nership of Dwellings (Hi) Maintenance, Rates and Insurance Contractors' charges for maintenance Timber Concrete blocks Wallboards and insulating materials Paint and wallpaper.. Cartage Rates, local authority Insurance on house.. Total, Maintenance, Rates and Insurance Total, Home Ownership TOTAL, HOUSING jobs WeightO HOUSEHOLD OPERATION (a) Fuel and Light Coal, delivered Electricity..... Gas Oil, domestic heating.. Total, Fuel and Light (b) Household Furnishing Weighto (I) Household Appliances Electric Household Appliances Blanket Cake mixer Clothes dryer, tumbler Drill, portable Freezer 0.22 Frypan Iron Jug Radiator.. Radio Range Razor Refrigerator Sewing machine Stereo Tape recorder Toaster Television sets, black and white. and colour 0.22 Vacuum cleaner Washing machine 0.40 (ii) Other Household Appliances Motor mower Stroller Total, Other Household Appliances Total, Household Appliances Furniture Bedroom suite, and tallboy Dining room and lounge suites and cocktail cabinet Kitset furniture Mattresses.. Blinds Cot Piano Total, Furniture (Hi) Floor Coverings Carpets Other flooring coverings Total, Floor Coverings (iv) Household Textiles Blankets Pillows and sheets Towels and teatowels.. Furnishing materials.. Total, Household Textiles (v) Household Equipment and Utensils Cake tin Baking dishes Clock Mixing bowl Glassware.. Saucepans.. Crockery Cutlery Tin opener.. Brooms 0.1 r Total, Electric Household Appliances ,04 TABLE 1 3. HOUSEHOLD OPERATION - continued Weighty ol Total (v) Household Equipment and Utensils ctd. Hammer Plane Hose, garden.... Ladder and steps.... Garden tools.... Total, Household Equipment and Utensils 1.12 Total, Household Furnishing (c) Household Supplies and (i) Household Supplies Battery, dry cell.... Bulb, electric light.... Pet food Cleanser powder.... Dish washing liquids.... Disinfectant.... Fly spray Foil, aluminium.... Garden fertiliser.... Garden plants.... Lawn seed Lunch wrap Polish, furniture.... Polish, shoe.... Washing powders.... Window cleaning fluid.. Total, Household Supplies (ii) Household Post Office Charges Postages Telegram Telephone rental, box and toll calls 1.32 Total, Post Office Charges Other Household Dry cleaning.... Household furniture removal.. Insurance on house contents Television hire Television licence.... Repairs to appliances Veterinary fees.... Total, Other Household 1.46 Total, Household Total, Household Supplies and APPAREL (a) TOTAL, HOUSEHOLD OPERATION Clothing (i) Men's Clothing Cardigan Handkerchief.... Jacket Jeans Pyjamas, light-weight.... Raincoat Shirts, business.... Shirts casual.... Shirts, working.... Singlet, lightweight..-.. Socks Suit Swimming trunks.... Trousers, sports.... Trousers, working.... Underpants V/alk shorts Windbreaker.... Total, Men's Clothing WeightO (ii) Women's Clothing Brassiere.... Cardigan, lightweight.... Cardigan, heavyweight.. Coat Dressing gown.... Frock, lightweight Frock, heavyweight.... Girdle Nightdress Panties Hosiery Pyjamas Raincoat Slacks, lightweight Slacks, heavyweight.... Skirt Suit Swimsuit Umbrella Underslip Vest Total, Women's Clothing (Hi) Boys' Clothing Jeans Pyjamas, lightweight.... Pyjamas, heavyweight.. Raincoat School uniform Shirt Shorts Underpants Total, Boys' Clothing (iv) Girls' Clothing Frock Jeans Jumper Panties Pyjamas School uniform.... Shorts Skirt Slacks Socks Vest Total, Girls' Clothing.. (v) Infants' Clothing Nightwear Nursery squares.... Plastic pants.... Underwear Total, Infants' Clothing (vi) Piece Goods Coating material.... Fabric, sailcloth Fabric, synthetic, lightweight Fabric, synthetic, heavyweight.. Cloth, wool I en/cotton mixture.. Cloth, woollen, medium weight.. Total, Piece Goods (vii) Sewing and Knitting Materials Pattern, paper.... Thread, sewing.... Wools, knitting Zip Total, Sewing and Knitting Materials 0.46 Total, Clothing

4 TABLE 1 REGIMEN OF CONSUMERS PRICE INDEX, 1974'i> - continued TABLE 1 REGIMEN OF CONSUMERS PRICE INDEX, 1974U) - continued 4. APPAREL (b) Footwear (i) Men's Footwear Boots, football Boots, heavyweight Sanoshoes.. Shoes, bowling Shoes, lightweight Shoes, heavyweight Repairs to men's shoes Total, Men's Footwear (li) Women's Footwear Shoes, lightweight Shoes, heavyweight Sneakers Repairs to women's shoes Total, Women's Footwear (Hi) Children's Footwear Gumboots, Y-thong Shoes, boys' school Shoes, infants' Shoes, girls' Total, Children's Footwear Total, Footwear TOTAL, APPAREL 5. TRANSPORTATION (a) Public Transport (I) Land Travel Urban and suburban bus and rail fares Long distance bus and rail fares Taxi fares.. Rental car hire Total, Land Travel.. (If) Air Travel Air fares (III) Sea Travel and Transport of Vehicles inter-island passenger fares and vehicular transport charges Total, Public Transport (b) Private Transport (I) Purchase of Vehicles Car, new Car, used Motorcycle, new Bicycle Total, Purchase of Vehicles Bass Weights( Weight s(3 (ii) Motor Vehicle Running and Maintenance Petrol Lubrication Tyre and tube, including retread.. Decarbonise and valve grind Overhaul of brakes Overhaul of gearbox Reconditioned short block Annual licence Driving licence.... Driving-school fee.... Insurance Total, Motor Vehicle Running and Maintenance Total, Private Transport TOTAL, TRANSPORTATION MISCELLANEOUS (a) Tobacco and Alcohol (i) Tobacco, Cigarettes, and Requisites Cigarettes, including cigars Tobacco, pipe and cigarette Matches (II) Total, Tobacco, Cigarettes, and Requisites Alcohol Beer, draught Hotel or tavern sales of draught beer (including lager type beers and stout) sold by the glass, or flagon or jug 1.23 Beer, bottled and canned Bottled and canned beers consumed in hotel or tavern or purchased for consumption off the premises, wholesale and retail Spirits Spirits consumed in hotel or tavern or purchased for consumption off the premises, wholesale or retail Wines Local and imported wines purchased wholesale or retail Total, Alcohol Total, Tobacco and Alcohol (b) Other Supplies (I) Medical and Health Supplies Adhesive dressings.... Antiseptic liquid.... Aspirin Cough remedy.... Hormone tablets.... Paracetamol.... Throat tablets.... Vitamin concentrate.... Total, Medical and Health Supplies MISCELLANEOUS continued <l>) Other Supplies (ii) Cosmetics Deodorant Face powder F-ounaation makeup Haircream Hair rinse Hair rollers.. Hair spray.. Hand cream.. Lipstick Mascara eye liner Skin perfume Total, Cosmetics (Hi) Personal Goods Toiletries Talcum powder Razor biacles Sanitary towols Shampoo Toilet paper Toilet soap Toilet tissues Toothbrush Toothpaste Total, Toiletries continued Other Personal Goods Handbaq.. Satchel Suitcase.. Ring, engagement Watch Total, Other Personal Goods Toial, Personal Goods (iv) Stationeiy Supplies Binder file refill Envelopes.. Exercise books Pad, writing Pen, ball-point Pen, fountain Pencil Total, Stationery Supplies (v) Leisure and Recreational Supplies Boat and boating equipment Photographic equipment, and supplies Caravan Cassettes and gramophone records Children's toys Equipment for sports, games, and tramping Music instruments Swimming pool Total, Leisure and Recreational Supplies (vi) Newspapers, Magazines, and Books Newspapers Magazines and periodicals Books, popular reading Library subscription F.ciucational text-books Total, Newspapers, Magazines, and Books Books (D Total, Other Supplies Weighty tc) Other Weighty (I) Health (over and above Social Security) Optometrists' fees 0.18 Dentists' fees 0.41 General medical practitioners' fees (over and above Social Security) 0.36 Medical specialists' fees (over and above Social Security) Private general hospital fees (over and above Social Security) 0.25 Total, Health 1.34 (ii) Recreational, Cultural, and Educational Admissions to concerts and cinemas Admissions to games and sports events Fishing licence Music, singing, etc., tuition fees.. Primary, secondary and tertiary tuition and examination fees.. Sightseeing and scenic tours Subscriptions to sports and other clubs Total, Recreational, Cultural, and Educational (Hi) Accommodation, Board, and Lodging Board at schools Licenced hotel tariffs.. Private hotel tariffs Motel tariffs and motor camps charges (iv) Credit Total, Accommodation, Board, and Lodging.. Hire purchase charges Total, Credit (v) Personal Funeral, burial, and cremation fees Haircuts Hairset, woman's Labour union dues Watch repairs Total, Personal Total, Other TOTAL, MISCELLANEOUS.. GRAND TOTAL, ALL GROUPS The estimated quantities of commodities purchased in the year ended June 1974 have been repriced with the average prices of the year ended December 1974 to provide the base expenditure of the index - base: year ended December 1974 M0C0). For convenience of presentation, the figures shown in this published table have beer, rounded (independently) to fewer decimal places than are used in the calculations. Because of this rounding, tne sums of the weights ot the individual items as shown in the table are not always id.tiiic&l with the total.

TABLE 2 REGIMEN OF CONSUMERS PRICE INDEX, 1974 SEASONAL FRUIT AND VEGETABLES on Annual Basis at Price W ( a > Jan Feb Mar Apr May j Jun Jul Aug Sep Oct Nov Dec I " Apples 0.26 0.29 0.33 0.

5 TABLE 2 REGIMEN OF CONSUMERS PRICE INDEX, 1974 SEASONAL FRUIT AND VEGETABLES on Annual Basis at Price W ( a > Jan Feb Mar Apr May j Jun Jul Aug Sep Oct Nov Dec I " Apples Apricots _ Bananas Grapefruit Kiwi berries >-:,0 *MC( Lemons Oranges Poaches U _ Peara e&st~'$' U.U6 Plums Strawberries!-- ; l(it-_' _ Tamarillos i, r~. mm Beans _ Brussels sprouts. >. Cabbage Carrots Cauliflower Celery Cucumber _ Kumaras Leeks Lettuce Onions Parsnips BOitiJ _ Potatoes Pumpkin _ Silverbeet Swedes Tomatoes 0.36 Totals (2) For convenience of presentation the figures shown here have been rounded (independently) to fewer decimal places than are used in the calculations. Because of this rounding, sums of the individual items may not always appear identical with the totals. 'on annual basis" means on the assumption that the average expenditure on seasonal fruit and vegetables in each month of the base year comprises 2.25 percent of the average total expenditure. In the base year as a whole the average expenditure on this grouping of Items comprises 2.25 percent of the average total expenditure of th<» whole year. TABLE 3 CONSUMERS PRICE INDEX - COMPARISON OF THE EXPENDITURE WEIGHTING OF THE 1974 REGIMEN WITH THAT OF THE 1965 REGIMEN Group and Sub-group 1965 Food: Fruit and Vegetables " 5.89 Meat, Fish and Poultry 9.22 Other Foods Housing: Rentals Home Ownership Household Operation Fuel and Light Household Furnishing 5.59 Household Supplies and 2.80 Apparel: Clothing Footwear Transportation: Public Transport Private Transport Miscellaneous: Tobacco and Alcohol 7.64 Other Supplies Other Totals Covered by the Index

REVISION OF THE CONSUMERS PRICE INDEX 1977

Supplement to the April 1978, Monthly Abstract of Statistics REVISION OF THE CONSUMERS PRICE INDEX 1977 The Department of Statistics has revised the Consumers Price Index. The original index was described