Amid fears rising food prices are hitting those on lower incomes harder, changes are being made to better understand the impact - but how have costs changed in the past decade?
December saw prices for food and non-alcoholic drinks rising at their fastest monthly rate since January 2012 - up 1.3% in a month.
That rise was part of the reason the figures released by the Office for National Statistics last week showed the overall Consumer Prices Index (CPI) rose by 5.4% in the 12 months to December 2021, up from 5.1% in November.
That was the biggest annual increase since a rise of 7.1% in March 1992.
However, anti-poverty campaigner Jack Monroe explained in a viral Twitter thread that the headline figure doesn’t reflect the impact of big price changes for essentials on those on low incomes with no ability to absorb price rises.
She talked about the way in which the cheapest 500g of pasta in her local supermarket had gone from 29p to 70p, while a 1kg bag of rice used to cost 45p, but not what was available was 500g for £1.
She is now working with economists, charities and analysts to compile her own index - that will document the disappearance of budget options and the creeping prices of basic versions of essential items.
Now, the ONS has announced it will change how it measures prices of goods to try to provide a clearer picture of how different changes in costs affect different groups of people.
How does the ONS currently measure inflation?
It is produced by collecting the prices of over 700 everyday goods and services bought by UK households in numerous locations up and down the country, as well as online, to give the ONS more than 180,000 price points.
It then combines this with detailed information on spending patterns to calculate accurate price changes for goods and services in the UK.
You can get an idea the kind of information they collect, with this visualisation, which takes all of the price points collected for different food and drink items, and then looks at the median price each month (the median is the mid point in all the values).
This gives a rough idea of how much it would have cost to buy each item over the past 11 years.
As the ONS points out the headline measure captures the average, but everyone has their own personal inflation rate. Some people may spend a larger proportion of their income on gas and electricity, or petrol if you commute via car daily.
The ONS is now planning to put out more detail looking at how inflation impacts different groups in society.
Over the longer term, it’s going to transform the way it measures prices, by increasing the number of price points dramatically each month from 180,000 to hundreds of millions, using prices sent to us directly from supermarket checkouts.
So instead of just picking one apple in the shop to represent apples, the ONS will include how much every apple costs, and how many of each type were purchased, in many more shops in every area of the country.
This hopefully will allow more analysis of how prices are changes and the impact on people’s spending - If one variety of apple goes up in price while another falls, do some people switch varieties to avoid a price rise? And given that people of different means undoubtedly buy different varieties of products, what happens to the price of own brand versus branded baked beans?
You can explore the ONS’s current data in more detail in the below visualisation, which shows all the price point data they currently collect for December in each of the past 11 years.
For each item, you can see both the highest and lowest prices recorded (which may give some indication of how value and branded versions varied).
The boxes show the range in prices - those items below the box are in the bottom 25% of prices, the midpoint in the box is the midpoint in the prices (the median), and the items above the box are in the top 25% of prices.
