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Retail Prices Index Excluding Mortgage Interest Payments

Lord Jacobs asked Her Majesty's Government:

Lord McIntosh of Haringey: The information requested falls within the responsibility of the National Statistician, who has been asked to reply.

Letter from the National Statistician, Len Cook, dated 15 November 2000.

As National Statistician I have been asked to reply to your recent questions on the Retail Price Index (RPI). Your first question asks what would be the RPI excluding mortgage payments (RPIX) in September 2000 if the depreciation of owner occupied houses, which has been a component of the index since 1995,

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had never been introduced; and how this compares with the RPIX for that month (HL4530). Your second question asks for an approximate calculation of the theoretical RPIX for September 2000 on the following basis: (a) that the depreciation component for owner occupied houses was introduced in 1950, (b) that the rate of inflation since 1950 has been 2000 per cent, and (c) that the increase in house prices since 1950 has been 4,750 per cent; and how this figure compares with the actual RPIX for September 2000 (HL4531).

In response to your first question, the Retail Price Index excluding both mortgage interest payments and depreciation stood at 167.4 in September 2000 compared to 168.9 for RPIX. The annual rate of change of the Retail Price Index excluding both mortgage interest payments and depreciation was 1.8 per cent compared to 2.2 per cent for RPIX in the same period.

These figures are published each month in table 2 of the Consumer Price Indices First Release and on the National Statistics website

In response to your second question, I am unable to provide an estimate both for reasons of disproportionate cost and because it would not be accurate enough to be of publishable quality. The Retail Prices Index is chainlinked annually and to calculate even an approximate estimate of a hypothetical RPI for September 2000 would require weightings for the depreciation component for each year as well as reworking all the other RPI component weights for each year. In addition it would be necessary to remove the "rental equivalent" of owner occupied housing that was included in the RPI between 1956 and 1974 to avoid double counting of housing costs (the rental equivalent includes an element of depreciation).

You might like to note that had the depreciation component been included in the RPI since 1950 the latest annual inflation rate would be unaffected as this only depends on price changes in the last year. The annual rate of change of RPIX for September 2000, had depreciation been included from 1950, would therefore be identical to the current published figure, 2.2 per cent, apart from rounding differences.

Personal Incomes: Top Rate of Direct Tax

Lord Marlesford asked Her Majesty's Government:

    Whether they will publish in the Official Report a corrected reply to the Question answered by Lord McIntosh of Haringey on 23 October (WA30-32) showing the top rate of direct tax on personal incomes in the United Kingdom for each year from 1970-71 to 1999-2000.[HL4563]

Lord McIntosh of Haringey: I very much regret that one table in my earlier answer was incorrect. The table should have read as follows.

Single, non-aged personal allowance for a man with no childrenTaxable income above which the highest rate is chargedHighest rate of income tax chargedRetail Price IndexSingle, non-aged personal allowance for a man with no children at 1999-2000 pricesTaxable income above which the hightest rate is charged at 1999-2000 prices

For 1970-71 to 1972-73 the highest rate of income tax is the highest rate of surtax.

For 1973-74 to 1983-84, the highest rate charged includes investment income surcharge at 15 per cent but this total rate would only apply if the taxpayer's income included investment income greater than the threshold for the highest rate of surcharge which varied between £2,000 in 1973-74 and £7,100 in 1983-84.

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Church Buildings: VAT

Lord Tebbit asked Her Majesty's Government:

    Whether it is within the power of Parliament to reduce or zero rate VAT on repairs to church buildings without the consent of the European Union.[HL4567]

Lord McIntosh of Haringey: No. The Paymaster General wrote to the European Commission on 8 November to ask for consideration of early legislative proposals to include repairs, maintenance and improvements to listed places of worship in the list of permissible reduced rates.

National Insurance Contributions

Lord Higgins asked Her Majesty's Government:

    Why the Chancellor of the Exchequer's Autumn Statement made no reference to his proposal to increase national insurance contributions.[HL4595]

Lord McIntosh of Haringey: The proposed increase in the upper earnings limit for employees' national insurance contributions from April 2001 was

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announced in the Chancellor of the Exchequer's Budget on 9 March 1999 as part of the Government's response to the recommendations in Martin Taylor's report. Full details of all changes in national insurance contributions rates and limits for the tax year 2001-02 were announced in the House of Commons by the Paymaster General, following the Pre-Budget Report (Official Report, 8 November 2000; cols. 274W-276W) and were also set out in an Inland Revenue press release.

A3 Kingston By-pass

Lord Brabazon of Tara asked Her Majesty's Government:

    How many road accident casualties there were on the A3 Kingston by-pass between the junctions with the A308 and the A309 in the 12 months to 31 May in each of the following years: 1997, 1998, 1999 and 2000.[HL4560]

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): The number of casualties on the A3 Kingston by-pass between the junctions with

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the A308 and A309 in the 12 months to 31 May in the years 1997, 1998, 1999 and 2000 were the following:

A3 Kingston by-pass(1): 1996-2000 Casualties


(1) The data above cover the stretch of the A3 by-pass 100 metres west of the Ace of Spades roundabout (Hook) and the Robin Hood roundabout (Kingston Vale). provisional 2000 data.

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