| Major groups | Number of items | Weights | Approximate number of price quotations |
|---|---|---|---|
| Food | 213 | 18.05 | 550000 |
| Housing: | |||
| Rented accommodation | 3 | 7.75 | 170000 |
| Home ownership (including repairs and maintenance) | 10 | 12.72 | 5000 |
| Other accommodation | 5 | 1.38 | 1000 |
| Water, fuel and electricity | 5 | 3.82 | 1400 |
| Other household operations | 44 | 5.77 | 23000 |
| Furnishings and household equipment | 67 | 4.88 | 15000 |
| Clothing and footwear | 91 | 8.69 | 50000 |
| Transport | 30 | 18.29 | 33000 |
| Health and personal care | 35 | 4.20 | 62000 |
| Recreation, reading and education | 95 | 8.84 | 35000 |
| Tobacco and alcohol | 10 | 5.60 | 21000 |
| Total | 608 | 100.00 | (a) 966400 |
Note: (a) Annual number of quotations.
Insurance is an area that necessitates a diversified approach. In some cases, the insurance can be associated with specific goods and services and is therefore included in the index. Insurance for homeowners and tenants and vehicle insurance are in this category, because the contract guarantees to replace or restore given goods. On the other hand, life and disability insurance are excluded because the payments stipulated in the insurance contract represent future purchasing power that cannot be identified with any specific set of goods or services.
Health services received by the population through the health insurance system are excluded, because the health insurance premiums do not reflect either the full value of the services rendered or a constant proportion of the value. Health services received by means of direct payment to the physician or hospital are likewise excluded, because the amounts paid for them are affected, in varying degrees, by government financing of medical care. On the other hand, medical supplies, pharmaceuticals and dental care are currently included, because the amounts of money paid for them relate to specific quantities and qualities of goods or services.
A special case for inclusion is made with regard to property taxes. While property taxes are not directly associated with specific goods or services obtained by homeowners, they are considered an integral part of the cost of owning and using a dwelling, and for this reason are included.
The frequency of price collection depends on the nature of the commodity. Some goods and services subject to frequent price change require frequent price collection. Prices for food commodities and gasoline, for example, are collected once a month. Most other commodities have monthly price collection. These include: household supplies, clothing, pharmaceuticals, personal care supplies, tobacco products, alcoholic beverages, rent, mortgage interest and new houses. The remaining commodities are characterised by less frequent price changes and, for this reason, their prices are collected at intervals longer than one month. Prices for furniture and household appliances are collected six times a year. Prices for automobiles, clothing services, personal care services, and newspapers are collected each quarter; automobile registration fees and property taxes are recorded once a year. However, additional price collections are carried out for these commodities when there is evidence of a significant price change between regular pricing dates, and, if required, changes are made to the regular pricing dates.
For most commodities, the price collection for a given month's index is carried out within a four-week period, starting from about the 20th of the previous month and ending in the middle of the given month.
The following elements are included as homeowners' costs: the cost of homeowners' repairs, property taxes, the replacement cost of that amount of owner-occupied dwellings that is assumed to be used up, the cost of homeowners' insurance and mortgage interest cost.
In many cases it is possible to collect prices of both the initial variety and of its replacement at a particular point of time. The ratio of these prices can be used as the price adjustment factor for quality change. The same technique is also applied when a given retail outlet replaces another outlet in the sample. This technique, sometimes referred to as splicing, is based on the implicit assumption that the difference in market prices between the two commodities (or the two outlets), as observed for a specific point of time, is entirely attributable to quality differences between these commodities (or between the services provided by these outlets).
Sometimes it is possible to make explicit quality adjustments to recorded prices, i.e. to assess the difference in worth between the new variety and the replaced one due to the variation in quality between them. In the case of relatively minor changes, the assessment may be derived from cost analysis or by comparing the respective retail market prices of added or deleted equipment or services.
The practice for the treatment of seasonal items is to extrapolate the index for the seasonally priced item based on the index movement of continuously priced commodities in the group to which it belongs. For example, the February index for women's winter coats would be represented by the January index multiplied by the ratio of the February index to the January index for a women's wear aggregate. This aggregate, as well as all others used in seasonal imputation, excludes any basic groupings that are seasonally priced.
The carry-forward imputations are made for prices of items at the outlet level; the group imputations are made for price indexes at the basic grouping level. Where feasible, the group that is the source of the imputation is the group immediately above the targeted good in the primary classification. It there are no continuously priced basic groupings in that group, the group one level higher in the primary classification is used instead as the source group.
First, monthly average prices are derived for each priced commodity, for each urban-centre stratum. Month-to-month price indexes are then calculated as ratios of the corresponding average prices in the given month and in the previous month. Price indexes on a time base other than the previous month are not calculated directly by comparing (dividing) average prices, but are derived by multiplying, up to the given month, all month-to-month indexes subsequent to the time base. If a given basic grouping is represented by more than one priced commodity, price indexes are first calculated for each of these priced commodities and then their weighted average forms the estimate of the price movement for the basic grouping.
The national index for Canada can be computed both as a fixed basket price index relating to the national 1986 basket, or as a weighted arithmetic average of corresponding price indices for all 82 urban centres.
The Consumer Price Index(Ottawa), Monthly, Catalogue No. 62-001, Bilingual (English and French).
Idem: The Consumer Price Index reference paper: Updating
based on 1986 expenditures
, Catalogue No. 62-553, Bilingual
(English and French).