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CHAPTER VIII - PRICES
COLOMBO CONSUMERS PRICE INDEX (Base 2013=100)
It is a common practice of the countries that the basket of goods & services and the weights of the CPI are updated in regular intervals probably in five year intervals to accommodate the changing expenditure patterns, and to incorporate changes of goods & services available in the market. Accordingly it had been arranged to revise the base year from 2006/07=100 to 2013=100. CCPI with respect to the base year (2013=100) is computed monthly and published last working day of each month.
1. Characteristics:
The Colombo Consumers Price Index CCPI (Base: 2013=100) is based on data from the Household income and Expenditure Survey 2012/13.
1.1 Base period:
The year 2013 is the base period for CCPI (Base: 2013=100). The total monthly expenditure value of the base period is Rs. 60,364.73 and expenditure level is 115.80% greater than the base period expenditure level of Rs. 27,972.11 in the CCPI, Base: 2006/07. This increase reflects the increased expenditure due to higher income, prices and the changed composition of the consumption basket.
1.2 Market Basket of Goods and Services:
The CCPI (Base:2013=100) has a larger consumption basket than in the CCPI (Base 2006/07=100). It contains 95 sub classes; 10 groups in the CCPI (Base 2006/07=100) but 2013 basket 105 sub classes of goods and services further categorized; 12 groups. The share of food category was 28.24% while the share of Non – food category was 71.76%.
1.3 Full year coverage of Consumption patterns:
Expenditure weights were obtained using data on Household Expenditure in the Household Income and Expenditure Survey during the 12 months period from July 2012 to June 2013. Therefore, it has captured the seasonal variations of consumption pattern.
1.4 Coverage of House Holds in Colombo District urban areas:
The geographical coverage of the CCPI (Base: 2013=100) is same as that of in CCPI (Base: 2006/07=100) and it covered urban areas of the Colombo District, i.e. Colombo Municipal Councial, Dehiwala-Mt. Lavinia Municipal Council, Moratuwa Municipal Councial, Sri Jayewardenapura Municipal Council, Kaduwela Municipal Council Kolonnawa Urban Council, Seethawakapura Urban Council, Maharagama Urban Council, Kesbawa Urban Council and Boralasgamuwa Urban Council.
1.5 Price Collection Procedure :
The price collection of the new index (Base 2013=100) has covered 14 price collection centers in Pettah, Maradana, Wellawatta, Dematagoda, Grandpass, Borella, Kirulapone, Dehiwala & Mt. Lavinia, Kotte, Nugegoda, Kolonnawa and two Dedicated Economic Centers namely Narahenpita and Rathmalana as in index 2006/07.
1.6 Method of Computation:
In the Index (Base: 2013=100) DCS has introduced the use of Modified Two stage Laspeyers formula to calculate the CCPI.
1.7 Value of one Index Point:
Average consumption expenditure of a household of CCPI (Base: 2013=100) was Rs.60,364.73 and the value of one index point was Rs. 603.65.
 
NATIONAL CONSUMER PRICE INDEX :(Base 2013 = 100) for Sri Lanka
The Department of Census and Statistics (DCS) has been releasing Colombo Consumer Price Index (CCPI) with base period of 2006/07 from June 2011, covering the urban areas of Colombo district. The latest Consumer Price Index (CPI) released by the DCS is National Consumer Price Index (NCPI). NCPI will be released monthly commencing from November 2015 on monthly basis with a time lag of 21 days. The NCPI is considered as the country’s official price index. Also the NCPI will have weights based on consumer spending in 2012/13, and will reflect new methods consistent with international best practices.
1. Expanded Geographic Coverage:

To better reflect international best practices, the new CPI i.e National Consumer Price Index for Sri Lanka will be compiled using prices collected for all of the nine provinces. From 1953 to April 2008 the DCS has compiled and disseminated a CPI for the Colombo metropolitan area only. Since May 2008 to DCS has been compiling and disseminating a CPI covering the urban areas of Colombo district. However, there is great need for an index that measure price change for the entire country. As noted above, the CPI is one of the key indicators used to formulate fiscal and monetary policy decisions and further to enhance the effectiveness of the policy decisions, a national index is needed.

 
2. Features 
The National Consumer Price Index NCPI (Base 2013=100), is based on data from the Household Income and Expenditure Survey conducted in 2012/13. The 2012/13 HIES included all types of consumption expenditures by households, and was broadly representative of all households in the country. The main features of NCPI are as follows:
2.1 A Base period:

2.1 A Base Period:The year 2013 is the base period for NCPI. The total monthly value of the base period expenditure level on the basket of goods and services in the NCPI (Base 2013=100) is Rs.32,142.69. This expenditure level is 14.9% greater than the base period expenditure level of Rs.27,972.11 in the CCPI(Base 2006/07=100). This increase reflects the increased expenditure due to geographical coverage, higher income, price changed composition of the each provincial market baskets and reference periods.

2.2 Weights:

To reflect international recommendations and best practices, the provincial weighting structures are developed separately and for compiling the NCPI, the provincial weights refer to the consumption expenditures within the province in proportion to the total expenditures in the whole country.
2.3 Market Basket of Goods and Services:

NCPI (Base 2013 = 100) has a larger consumption basket than in the CCPI (Base 2006/07 =100). It contains 105 Sub Classes of goods and services further categorized in to 12 Divisions, as against 95 Sub Classes in the CCPI (Base 2006/07=100) The share of food category is 44.04% while the share of Non-food category is 55.96% in the NCPI (Base 2013 = 100)
2.4 Full year coverage of Consumption patterns:

Expenditure weights were obtained using data on Household Expenditure in the Household Income and Expenditure Survey during the 12 months period from July 2012 to June 2013. Therefore, it has captured the seasonal variations of consumer pattern.

2.5 Expansion of Price collection:

For Compiling CCPI, the DCS collects prices from fourteen price collection centers located in the Colombo district urban areas. For the NCPI, the prices are collected for each item in the market basket from 03 price collecting centers in each district town.
2.6 Inclusion of Alcohol, Tobacco and Narcotics:

The CCPI (Base 2006/07= 100) has not covered alcoholic beverages, tobacco and narcotics as an expenditure item in the consumption basket to be consistent with government policy of discouraging their alcoholic beverages, tobacco and narcotics as an expenditure item complying with international best practices.
2.7 Method of Computation:

In the past, the DCS used the Laspeyres index number formula to calculate the CPI, with the new NCPI, the DCS has introduced the use of the Modified, or Two – Stage Laspeyres formula to calculate the CPI.

2.8 Value of one Index Point:

Monthly average per household consumption expenditure of this index which is based on the year 2013 is Rs. 32,142.69 and the value of one index point was Rs. 321.42 (Rs. 32,142.69/100).

 

 

 

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