The harmonised index of consumer prices (HICP) is calculated in each member-state of the European Union to allow comparison of consumer price trends in the different states.
Normally, the HICP is published at the same time as the Central Statistics Office's (CSO) own consumer price index (CPI). But this month's HICP release was delayed for a week because the index was being extended to include some goods and services which had previously been excluded.
Among the additional items now being measured in the HICP are the fees paid for private primary education, second-level day and boarding fees, third-level tuition fees and maintenance, examination fees and play school costs.
In the health area, the fees charged by doctors, opticians and dentists, and the cost of prescribed drugs, therapeutic equipment and paramedical services will be included.
The basket of items measured is also being extended to take in health, travel and motorcycle insurance and childcare costs. The cost of household repair and decoration, toll charges and driving test fees will also be factored into the new index.
The new HICP index will take account of tourist expenditure too, thereby increasing the importance of items such as the cost of eating out.
The main difference between the Irish CPI and the HICP is accounted for by a number of items still excluded from the EU index.
Until December, 87 per cent of the items included in the Republic's official CPI index were measured in the HICP, with 13 per cent left out. Following the extension of the HICP basket, it will cover 92 per cent of the CPI basket, the CSO said.
Among the items which will continue to be excluded are mortgage interest, which does not play such a large part in continental European economies, where many people rent.
The cost of building materials and union subscriptions is not measured in the EU index either. Also left out of the HICP are certain insurance costs, hospital charges, motorcycle and car tax. Altogether, these items constitute around 8 per cent of the CPI index, which the CSO says still represents the most accurate measure of consumer prices in the economy.
