Bertie Ahern
Question:1 Mr. B. Ahern asked the Taoiseach the contribution of increases in food and drink prices to inflation over the past six months. [10566/97]
Ceisteanna—Questions. - Consumer Price Index.
The Consumer Price Index is designed to measure the change in the average level of prices paid, inclusive of all indirect taxes, for consumer goods and services by all private households in the country.
The CPI was compiled on a quarterly basis in respect of the middle Tuesday of the months February, May, August and November each year up until the end of 1996. From January 1997 onwards the CPI is being complied on a monthly basis. March 1997 is the latest month for which the CPI is available.
The contributions of changes in the levels of prices paid for food and alcoholic drink to the All Items CPI since August 1996 are as follows. In the seven months August 1996 to March 1997 the Consumer Price Index went up by 0.693 per cent of which the food contribution was minus 0.011 per cent and alcoholic drink contribution was plus 0.109 per cent. There is a difficulty in giving figures for the past six months because up until the end of last year the CPI was compiled on a quarterly basis. That is why I am giving figures for a six months and seven months period. In the six months from August 1996 to February 1997 the Consumer Price Index increased by 0.584 per cent of which the food contribution was minus 0.047 per cent and the alcoholic drink contribution was plus 0.113 per cent.
Is it significant that no member of the Government Front Bench appears to be available for Question Time? I am not casting any aspersion on the Minister of State, but that is most unusual. The Minister of State should promote himself to the Front Bench.
I understand from the Minister's reply that since January there has been a change in the compilation of the CPI from a retrospective six monthly basis to a monthly basis. The Minister of State is aware that the value of the punt against sterling has declined from IR£1.02 to 95p, a fall of approximately 7 per cent. That currency decrease is not reflected in the food and alcoholic drink prices he quoted. Is forward purchasing causing the fall in the value of our currency against sterling not to be reflected in the Consumer Price Index in terms of food prices?
The fall in the price of food as reflected in the CPI is accounted for by two food items, vegetables and beef. Those two food items when factored into the Consumer Price Index account for the zero factor in the seven monthly and six monthly periods in question. Apart from those items, other items in most cases show a slight increase. Even allowing for the aggregate figure for inflation over the full year, we still meet the convergence criteria for European Monetary Union qualification.
That is welcome and so too is the fact the consumer price index in relation to food has not increased, with the exception of the two items the Minister mentioned. The question concerned the fall in the value of the punt against sterling of up to 7 per cent and the fact it is not reflected in the consumer price index. Why has this drop not been reflected?
I will check out the query the Deputy raised and come back to her. I will inquire how the CSO reached the equation in question.
It should be reflected, not that we want it to be.
We will communicate with the Deputy.