Labour's cost of living figures out of date
Ahead of today's Budget, Labour has been driving out a familiar claim on the state of the economy since the election. Namely, that people are, on average, £1,600 worse off since the election.
We've looked at this in detail before. It's based on comparing average earnings each year with what those earnings would have been had they risen as fast as prices have (inflation). The trouble with this is that the answer is very different depending on which measure of inflation wages are being compared to.
Labour use the Retail Prices Index - but this is no longer considered a robust measure. In the Financial Times' economics editor's words, "when prices do not change, the RPI will normally show positive inflation."
RPI shows a much steeper drop than do other commonly-used measures:
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The latest earnings figures were released only this morning. Labour's £1,600 claim is now out of date, even on their preferred measure.