You are here
Last amended: 15 August 2013
What is the CPI?
The Consumer Price Index (CPI) provides the official measure of inflation in Australia. The CPI is calculated by the Australian Bureau of Statistics. Movement in the CPI is measured quarterly for the three month periods ending 31 March, 30 June, 30 September and 31 December each year. The CPI figures are normally publ — ished around four weeks after the end of the quarter. The CPI is not a percentage but an index number. Any two numbers from the index can be compared to calculate a percentage change.
CPI indexation factor
The CPI indexation factor is determined by comparing two quarters of CPI figures. The more recent of these quarters is known as the reference quarter and the older is known as the base quarter. The CPI number for the reference quarter is divided by the CPI number for the base quarter, rounding the answer to three decimal places.
Reference and base quarters for CPI
Legislation describes which CPI figures are used as the base and reference quarters. The reference and base quarters vary between different payments, allowances and limits.
The consumer price index (CPI) provides the official measure of inflation in Australia. The CPI measures quarterly changes in the price of a 'basket' of goods and services which account for a high proportion of expenditure by the CPI population group (i.e. metropolitan households).
The reference quarter is the more recent of the two quarters of CPI or PBLCI data used in indexing a payment rate, limit or threshold. The reference quarter CPI or PBLCI figure is compared to the base quater CPI or PBLCI figure to determine the indexation factor to be applied. The reference quarter is defined in the legislation and varies according to the amount being indexed.
The base quarter is the older of the two quarters of CPI or PBLCI data used in indexing a payment rate or limit or threshold. The reference quater of the CPI or PBLCI figure is compared to the base quarter CPI or PBLCI figure to determine the indexation factor to be applied. The base quarter is defined in the legislation and varies according to the amount being indexed.