Big rise in prices predicted

Press, 12 April 1982, Page 2

Big rise in prices predicted

New Zealand's inflation rate would increase greatly this year, Labour’s spokeswoman on consumer affairs (Mrs Ann Hercus) has said. She was commenting on the latest .Consumer Price Index figures for the year ended March 31, which indicated a steady increase in the inflation rate since a low of 15 per cent for the period June, 1980, to June, 1981. The latest figures of 15.8 per cent, compares with 15.2 per cent for the year March, 1980, to March, 1981. In the financial year March. 1979, to March. i9BO, inflation reached the record high of 18.4 per cent. The C.P.I. at March 31, 1982, was 3.2 per cent higher than it was at December 31, 1981. In the March quarter last year the increase was 3.1 pe’r cent, the June quarter 4 per cent, the September quarter 3.9 per cent and the December quarter 3.9 per cent. Mrs Hercus said the inflation rate for the latest quarter already showed an increase on the corresponding quarter last year. In addition, the recent huge increases in prices were still to come through into the index, she said. “If, as usual, the Government tries to make out that this latest C.P.I. represents a decrease in the rate of inflation. it will clearly indicate that the deceitful politics of the last election campaign are to be carried over , into the Government," said Mrs Hercus. The latest inflation figures take no account of the latest round of price increases which came into effect on April 1. The biggest contributor to the quarterly increase was housing: it made up 28.3 per cent of the 3.2 per cent increase in the index. Food was 13.6 per cent of the

increase, household running costs 14.6 per cent, transportation 18.1 per cent, clothing 2.2 per cent and miscellaneous, 23.2 per cent.

Among items which made the greatest direct contribution to the quarterly rise were housing mortgages, purchase of previously occupied houses, erection of dwellings and alterations, overseas air fares, used cars, petrol, telephone, toll calls, and medical insurance premiums.

For the same period, fruit and vegetables were up 16.1 per cent, meat, fish and poultry 12.8 per cent, other foods 15.5 per cent, rentals 16.2 per cent, fuel and light 11.8 per cent, household furnishings 14.8 per cent, household supplies and services 10.6 per cent, clothing 11.6 per cent, footwear 9.5 per cent, public transport 21.6 per cent, private transport 14.6 per cent, tobacco and alcohol 14.7 per cent. The biggest individual increase in an index over March, 1981, to March, 1982, was for home ownership, which increased 22.7 per cent.

“Now . the Government is talking of an across-the-board wholesale tax, which could slap another 9 or 10 per cent on to the inflation rate. The National Government has had double digit inflation every year since it took office,” said Mrs Hercus.

“On the figures released today, this year could be an all time record,” she said. “Over the next few months, that index will start to register the primary and secondary effects of: a 20 per cent increase in milk; an 18 per cent increase in coal; a 12 per cent increase in bulk electricity.charges; a 20 per cent increase in postal charges; a 40 per cent increase in phone rental charges: and many others.