A dose of reality?

Just how fast are prices rising? The Government will tell you that the figure is between 2½ and 4 per cent a year, depending on which price index you consult. And yet it feels much more than that, doesn't it? You see, it all depends on just what you mean by prices. The Government look at a whole range of things, including many non-essential or even plain luxury items. Many of these - particularly technological things like computers, TVs and so on - are actually coming down in price, and this is why the Government's figure doesn't appear to accord with what's actually going on out there. If you look at essentials, like food, heating and lighting, mortgage or rent, council tax and the cost of travel for example - the things you have no choice but to fork out for in order to live and work - then you come up with a figure well in excess of 10%. What we could do with is a price index which concentrates on the real genuine "cost of living".