SPC-PFTAC Workshop on quality adjustments and item substitution in the Consumer Price Index

Between 23 and 27 November 2015, statisticians from Pacific countries and territories came together in Nadi, Fiji for a workshop on quality adjustments and item substitution. The workshop was organised by the Pacific Community (SPC) and the IMF Pacific Financial Technical Assistance Centre (PFTAC) and aimed to train price index compilers in the use of internationally recommended compilation methods in order to improve the accuracy and comparability of consumer price indices in the Pacific.

The Consumer Price Index (CPI) is among the most important statistics compiled by national statistical institutes. Together with economic growth, it is the most widely used statistics for monitoring economic development and in developing economic policy. It is an essential tool for countries’ residents to evaluate the evolution of the purchasing power of their income, and is often used for indexation purposes for various social benefits and contract.

Quality adjustment procedures can have a large impact on this important statistic. The workshop therefore aimed to train statisticians in the use of internationally recommended adjustment techniques and to provide them with the tools to choose the most appropriate method in various situations. Furthermore, because the application of some of the methods can be complex, statisticians were trained in the use of software designed to assist with the calculation of quality adjusted price indices.

The workshop’s aim is in line with the goals as specified in the Ten Year Pacific Statistics Strategy and seeks to further harmonise the definitions, methods and classifications used in the Pacific. It builds on important prior work done in this area, such as the adoption and implementation of the Pacific COICOP classification. Adoption of recommended methods by statistician will lead to a marked improvement in the reliability and comparability of consumer price indices in the Pacific.

SPC and PFTAC would like to thank the attendants for their participations and their contributions to making the workshop a success.