Australia
Official title
Consumer Price Index.
Scope
The index is compiled quarterly and covers all metropolitan
employees' households. Employees' households are defined as
those households which obtain at least three quarters of their
total income from wages and salaries, but the top 10 per cent (in
terms of income) of such households are excluded. Metropolitan
means the eight capital cities of the Australian States and
Territories.
Official base
Year ending June 1981 = 100.
Source of weights
The present weights are based on the 1984 household expenditure
survey supplemented by information from a range of other
statistics, such as those obtained from financial institutions
and the 1986 Health Insurance Survey. Items are selected for
pricing if they represent a significant amount of metropolitan
household expenditure, if the prices can be associated with an
identifiable and specific commodity or service and if they can be priced
to constant quality. The price movements of items not priced are
assumed to be represented by those of items priced and the
weights of the items not priced are allocated to the priced items
representing them.
Weights and composition
| Major groups
| Number of items
| Weights
| Approximate number of price quotations
|
| Food
| 34 | 19.0 | 27000
|
| Tobacco and alcohol
| 4 | 8.2 | 11200
|
| Clothing and footwear
| 14 | 6.9 | 5500
|
| Housing:
|
| Rent of privately owned dwellings
| 1 | 4.1 | 8200
|
| Rent of Government-owned dwellings
| 1 | 0.4 | 5600
|
| Home ownership (mortgage interest charges, rates, repairs and maintenance and insurance)
| 4 | 9.6 | 22000
|
| Household equipment and operation:
|
| Fuel and light
| 3 | 2.4 | 100
|
| Household appliances
| 1 | 1.5 | 900
|
| Furniture and floor coverings
| 2 | 4.1 | 1200
|
| Household textiles
| 2 | 0.7 | 600
|
| Other household goods and services
| 14 | 5.7 | 3000
|
| Postal and telephone services
| 2 | 1.5 | 200
|
| Consumer credit
| 1 | 2.5 | 200
|
| Health and personal care
| 6 | 5.6 | 3800
|
| Transport
| 7 | 17.0 | 5600
|
| Recreation and Education
| 11 | 10.8 | 5500
|
| Total
| 107 | 100.0 | 100600
|
Note: (a) See below. (b) Per quarter.
a) These figures represent the number of expenditure
classes
and not individual items priced. Each expenditure
class consists of a selection of similar items
&eg., the
four expenditure classes in the Tobacco and alcohol group
are: beer; wine; spirits; cigarettes and tobacco. Each of these
classes covers a range of varieties of liquor or tobacco
products.
Household consumption expenditure
Household consumption expenditure for the purpose of the index is
defined as the actual expenditure on consumer goods and services
during the weighting base period. It excludes notional
expenditure, contributions to private superannuation and pension
funds, income taxes and other direct taxes, life insurance
payments, remittances and gifts, jewellery, legal services, club
and trade union subscriptions and gambling. It includes income
in kind, mortgage interest charges, consumer credit charges,
optical services, motor car registration and licence fees,
insurance associated with specific consumer goods, health care,
local government rates and charges.
Method of data collection
Localities and outlets are selected on the basis of information
from the population census, retail trade data and the local
knowledge of the field collection officers. No point-of-purchase
survey was carried out. Approximately 5,500 respondents in
eight cities are approached for price data and about 100,000
price quotations are collected each quarter from supermarkets,
department stores, footwear stores, restaurants, home delivery
suppliers, other retail outlets, service establishments, etc. Prices
for items such as rail fares, electricity, etc. are obtained from the
authorities concerned. Prices are collected each week for fresh fruit
and vegetables, each fortnight for fresh fish and each month for fresh
meat, bread, cigarettes and tobacco, packaged alcohol and petrol.
Prices for some important items are collected at the end of the quarter
and dates of price changes are registered to enable average quarterly
prices to be calculated. Prices for all other items are collected once
a quarter, with the exception of local government rates and charges,
seasonal clothing and lawn movers, for which prices are collected once a
year. The prices used in the index are those that any member of the
public would have to pay on the pricing day to purchase the specified
good or service, including sales and excise taxes. Sale and discount
prices and specials
are reflected in the index so long as the
items are of normal quality and are offered for sale in reasonable
quantities. There is no general pricing date. Price collection is
spread throughout the quarter.
Housing
Rent quotations are collected each quarter and are based on an
extensive sample of privately-owned and government-owned
dwellings. Home ownership costs are represented by actual
outlays on repairs and maintenance, rates, insurance and mortgage
interest charges.
Specification of varieties
The selection of the particular varieties of items to be priced
is made after the analysis of data from manufacturers, importers and
retailers. Brands and varieties are generally those which sell
in greatest volume. On the basis of these data, detailed
specifications are drawn up for each item to be priced, including such
details as: brand name, model name, size, country of
manufacture, and other necessary information to enable pricing to
constant quality over time.
Substitution, quality change, etc.
Completely new products are introduced in the index at the time
this is reviewed, approximately every four to five years. New
varieties of existing products are introduced when they become
significant in terms of that category of consumer expenditure.
When a given type or quality disappears from the market, it is
taken away from the index and, if warranted, a replacement is
substituted using the linking procedure. With respect to quality
changes, the main techniques adopted are: i) direct assessment
of the value of the quality change with a corresponding
adjustment to the price of the item concerned; ii) linking in new
specifications.
Seasonal items
Price collection for fresh fruit and vegetables is extended
to seasonal items not available throughout the year. In periods
when particular seasonal items are not available, prices are
imputed on the basis of movements in prices of those items that
are available. Prices for seasonal clothing items are
collected once a year in the relevant seasonal quarter. For the
other quarter of the year, the price is held constant. No
adjustment is made for seasonal fluctuations in item prices.
Computation
The index is computed quarterly according to the Laspeyres
chain-linked formula with fixed base weights. Changes in the
weighting pattern and composition occur at approximately
every five years.
The national index is calculated as a weighted average of the
index numbers of the eight capital cities, using as weights the
number of households of the index population group in each city.
Other information
A new series of Consumer Price Indices (base: year ending June
1990 = 100) is under preparation and will be published shortly.
Organisation and publication
Australian Bureau of Statistics: Consumer Price Index
Catalogue No. 6401.0 quarterly (Canberra, ACT).
Actual prices of a selection of goods included in the CPI are
published in: Average Retail Prices of Selected Items, Eights
Capital Cities
, Catalogue No. 6403.0.
Idem: A Guide to the Consumer Price
Index
, Cat. No. 6440.0, 1987.
Idem: Review of the Consumer Price
Index
, Cat. No. 6450.0.
Idem: The Australian Consumer Price Index; Concepts, Sources
and Methods
, Cat. No. 6461.0.