PRICE INDEX REVISION

Press, Volume XCV, Issue 28266, 2 May 1957, Page 12

PRICE INDEX REVISION

“No Change In Principle ”

(New Zealand Press Association) WELLINGTON, May 1. “There has been no basic change in principle in the compilation of the consumers’ price index, and the revised index follows closely the principles laid down by an index committee appointed by the Labour Government in 1948 and chaired by Mr Walsh himself.” said the Minister of Finance (Mr J. T. Watts) this evening. The Minister said that in his presidential address to the Federation of Labour, Mr F. P. Walsh had expressed concern as to the accuracy of the revised index recently released by the Government statistician (Mr G. E. Wood). The committee which Mr Walsh had chaired had concluded that the index should not be limited in application to a given economic group or a specified type of community, but should be representative of post-war consumption among the generality of New Zea - landers, said the Minister.

“The Government Statistician, in reviewing the index in conformity with the changes in consumption habits since 1946. the weighting base of the previous index, has kept this requirement in mind,” said Mr Watts. Increased prosperity and the greater availability of goods and services meant that some new items had to be added, while the weighting bf some other items, notably consumer durables such as washing machines, had been increased.

Mr Walsh objected specifically to the inclusion of private motoring in the revised index, continued th 6 Minister. The number of cars licensed had increased from 206.070 in June, 1946, to 411.217 in June, 1956. Canada, the United States, and the United Kingdom now included this item, and in view of the wide distribution of cars among all sections of the community it was thought the time had come for New Zealand to include it also. This had been pointed out by the Government Statistician in his account of the revision of the index.