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Inflation

Volume 885: debated on Monday 27 January 1975

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asked the Chancellor of the Exchequer what is the current rate of price inflation for the most recent month for which figures are available, making use of the same basis of computation as that used to arrive at the figure of 8·4 per cent. quoted for an earlier period.

I would refer the hon. Member to my answer to the Member for Derbyshire, South-East (Mr. Rost) on 21st January.—[Vol. 884. c. 318.]

asked the Chancellor of the Exchequer what the rate of price inflation was in the year ended 31st December 1974; what proportion of this was attributable to domestically-generated inflation; and what proportion was attributable to the increased cost of imported oil.

The rise in the retail prices index in the year to December 1974 was 19·1 per cent. No figure is available for the total effects on the index, including indirect effects, of the increased cost of imported oil, nor is it possible to give a precise figure for the contribution of domestic costs, because of the variable lags with which cost increases feed through into the price level. In the early part of the year, however, oil and other import prices were the principal contributors to inflation, while in recent months domestic costs have been increasingly important. In its latest report the Price Commission estimated that in the three months to November labour cost increases accounted directly and indirectly for 60 per cent. of price increases by pre-notifying companies.