Consumer Price Index-Industrial Workers
The Labour and Employment Ministry revised the base year of the Consumer Price Index for Industrial Workers (CPI-IW) from 2001 to 2016.
• It was done to reflect the changing consumption pattern, giving more weightage to spending on health, education, recreation and other miscellaneous expenses, while reducing the weight of food and beverages.
• The sample size was increased from 41,040 families to 48,384, and the number of selected markets for collecting retail price data from 289 to 317.
• The number of items directly retained in the index basket has increased to 463 items as against 392 items in the 2001 series.
• The weight of food and beverages has declined over time whereas the weight of miscellaneous group (health; education and recreation; transport and communication; personal care and effects; household goods and services etc.) has increased substantially under 2016 series vis-à-vis earlier series. The weight of housing group has reported an increasing share over period of time.
• The weight to food and beverage was reduced from 46.2% to 39%, while spending on housing increased from 15.2% to 17%.
• The new series would not have an impact on the dearness allowance (DA) given to government employees for now.
The new series, representing the latest consumption pattern, would be in the interest of workers. The number of centres, markets and the sample size for working class family income and expenditure survey were all increased.
Labour and Employment Secretary said that in the future, the Bureau would work towards revising the index every five years. The reduction in weight to spending on food and beverages indicated an increase in disposable income.
The Bureau was expected to bring out the new series of the CPI for agriculture workers, which currently has the base year of 1986-87) by August.
PEPPER IT WITH
WPI, Index of Industrial Production, Headline Inflation.