Labour rallies against permanent RPI-CPI switch

Labour Shadow pensions minister Rachel Reeves says the opposition party will oppose a permanent switch in pensions indexation from RPI to CPI.

Speaking at the Professional Pensions Show yesterday evening, the MP for Leeds West accused pensions minister Steve Webb of announcing the policy without proper consultation.

She said: “I heard Steve Webb say CPI is a better measure of inflation for pensioners, but he hasn’t consulted the ONS on that. It’s easier to say it’s a better measure than it is to prove it. It’s very clear that it’s a cost-saving policy.”

However, Reeves indicated Labour could be willing to support a short-term switch in the inflation measure to help tackle the UK’s burgeoning deficit.

She said: “We wouldn’t be willing to support a permanent switch from RPI to CPI, but we would consider it for a term of Parliament.”