It’s expensive being poor, especially when inflation is running wild. Following pressure from a prominent anti-poverty campaigner—wielding economic theory from one of the U.K.’s most-beloved fantasy authors—the country’s top statisticians have taken this truism to heart and pledged to break down inflation figures for different income groups.
The Office of National Statistics (ONS) will still publish its headline inflation figure, which stands at a nearly 30-year high of 5.4%. However, the agency said Wednesday that from the end of this week it will also resume publication (suspended due to pandemic shortages) of more detailed “experimental statistics” for the Consumer Prices Index, which is a key measure for calculating inflation rates.
“We are committed to ensuring that our statistics are relevant and continue to meet user needs,” an ONS spokesperson said in an emailed statement. “As part of this we are restarting publication of inflation broken down according to how much income you earn.”
‘True cost-of-living crisis’
The ONS has not confirmed that its decision was a reaction to the campaigning of Jack Monroe, a prominent British food writer, but it’s difficult to escape that conclusion.
Monroe, who has long been an anti-poverty campaigner, reacted to the publication of the 5.4% headline figure last week with a Sunday Observer article arguing such inflation measures “grossly underestimate the true cost-of-living crisis.”
The thrust of the piece was that the cheapest food items have been getting more expensive, while their variety has been shrinking, forcing the poorest to either buy less for more, go to a food bank, or starve.
“So, along with a team of economists, charitable partners, retail price analysts, people working to combat poverty in the U.K., ex-staff from the Office for National Statistics and others who have volunteered their time and expertise, I am compiling a new price index—one that will document the disappearance of the budget lines and the insidiously creeping prices of the most basic versions of essential items at the supermarket,” Monroe wrote. “At the very least, it will serve as an irrefutable snapshot of the reality experienced by millions of people.”
The name of this new price index refers to its inspiration: the Vimes Boots Index.
‘A really good pair of leather boots’
For those unfamiliar with the Discworld novels of the late Terry Pratchett—one of the U.K.’s most successful fantasy authors, and its best-selling author before J.K. Rowling took off—some feature as their main character a philosophically-minded police detective named Sam Vimes. As described in the novel Men at Arms, “the Captain Samuel Vimes ‘Boots’ theory of socioeconomic unfairness” explains that the rich are rich because they manage to spend less money:
He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.
But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that’d still be keeping his feet dry in ten years’ time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.
Monroe’s naming of their new index drew approval from the estate of Pratchett, who passed away in 2015 after a battle with early-onset Alzheimer’s disease. Monroe announced this on Tuesday, along with the news that “the ONS chiefs want a meeting. With me.”
‘Personal inflation rate’
“The average annual rate of inflation can conceal a lot,” wrote ONS inflation statistics chief Mike Hardie in a Wednesday blog post. “When you are regularly collecting 180,000 prices, you will observe a lot of variety. And over the past few months, there have been some large changes. Some items such as ‘fruit drinks’ and ‘low-fat spread’ experienced annual price increases of over 30% on average in December, and when analyzing the individual price quotes it’s not uncommon to see price changes of over 100% for some items.”
These isolated cases of huge price increases don’t have a big impact on the headline inflation rate, Hardie wrote, but “everyone has their own personal inflation rate” based on what they spend a larger proportion of their income on.
In the longer term, the ONS has already been working on a radical overhaul of how it tracks prices. Today’s “inflation basket” tracks the changing prices of 700 widely-bought items, but the future system will be far more fine-grained, using hundreds of millions of price points “sent to us directly from supermarket checkouts,” Hardie wrote. “While it will not show us what each consumer has bought, protecting their privacy, it will show exactly what has been sold and for how much, giving us even more detail on how inflation is affecting U.K. households.”
The ONS’s shift “has the potential to kickstart an avalanche of change,” Monroe tweeted Wednesday, citing the agency’s influence on government policy. But the Vimes index is still happening, with Monroe hoping to have it “published in time for the next round of inflation figures to come out mid-February.”
“The next goal is to use both the Vimes Boots Index and the ONS [data] to lobby, with hard data and facts, for a guaranteed decent income for everyone,” Monroe tweeted.
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