What’s this?
Households have different spending habits. A younger household spends more on rent, and an older household more on energy bills. This means that rising inflation doesn’t affect everybody in the same way. Some households will find it easier to cut back than others.
You can use the tracker to see:
- the increase in cost different households would now face if they were to buy the same goods and services they bought in a typical week before the pandemic (2020); and
- which categories of goods and services (such as energy bills, rent and food) would contribute the most to this increase in cost, and by how much.
This is not an inflation measure, but the tracker helps us see how much more a household would have to spend to maintain the same standard of living they had in 2020. And which household types are most likely to have had to scale back on essentials.
Last updated April 2024, updates quarterly.
London's Cost of Living Tracker
SUMMARY
This section takes a household’s spending on its basket of goods and services from before the pandemic - the three years to Q1 2020 - and looks at how the items in that basket have changed in price since. This allows us to see how much more households in different groups would have to spend now to achieve the same standard of living that they had before the pandemic. Use the drop down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
KEY FINDINGS
27% - the increase in price that households in London with the lowest incomes would see if they were to buy the same goods and services as they did in the three years to March 2020.
2 - the percentage point gap between increases in expenditure for the most and least impacted income groups, in London.
Inflation impact - the estimated percentage change in spending for London households, if buying the same goods and services (April 2020 - March 2024)
Inflation isn’t felt by everyone in the same way. The headline inflation figure is measured as the average rise in price of goods and services that people buy. But the prices of products and services don’t change at the same rate, and individual households consume a different mix of those.
Over the course of the last four years, price increases have more severely affected households with lower incomes than those with higher incomes. Following a steep rise in prices in Spring 2022, we can clearly see that those most affected are the 40% of households with the lowest incomes and those least affected are the 40% of households with the highest incomes.
SUMMARY
This section takes a household’s spending on its basket of goods and services from before the pandemic - the three years to Q1 2020 - and looks at how the items in that basket have changed in price since. This allows us to see how much more households in different groups would have to spend now to achieve the same standard of living that they had before the pandemic. Use the drop down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
KEY FINDINGS
29% - the increase in the cost of a London household’s basket of goods and services between April 2020 and now for those over 65 years old.
5 - the percentage point gap between the increases in expenditure for the most and least impacted age groups.
Inflation impact - the estimated percentage change in spending for London households, if buying the same goods and services (April 2020 - March 2024)
There are differences in the impact of inflation on households that are headed by people of different age groups, with older households being more heavily affected than younger ones. This graph takes the price of a household’s basket of goods and services from before the pandemic and looks at how it has increased in price since. If an older household (65 years and older) in London were to buy the same basket as they did in the period between April 2017 and March 2020, they would see a 29% increase in price. This is compared to 24% for younger households (20-34 years old).
This section takes a household’s spending on its basket of goods and services from before the pandemic - the three years to Q1 2020 - and looks at how the items in that basket have changed in price since. This allows us to see how much more households in different groups would have to spend now to achieve the same standard of living that they had before the pandemic. Use the drop down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
Inflation impact - the estimated percentage change in spending for London households, if buying the same goods and services (April 2020 - March 2024)
Households are defined as being in poverty if their equivalised (that is, taking into account households’ different size and composition) income after housing costs was less than 60% of the median. This was based on incomes during the three years up to March 2020. We found that inflation has had a similar impact on households that are in poverty and those that are not in poverty. If they were to buy the same products and services as they did in the three-year period to March 2020, both of these groups would experience a similar increase in price of about 25%. However, given that the spending patterns of these two groups are likely to be different, this increase is also likely to have been felt very differently. We discuss this in more depth in The Impact of Inflation section.
Go to the next section Pre-Pandemic Expenditure or scroll up and use the drop down menu to see the data split by income group, age group and type of tenure.
SUMMARY
This section takes a household’s spending on its basket of goods and services from before the pandemic - the three years to Q1 2020 - and looks at how the items in that basket have changed in price since. This allows us to see how much more households in different groups would have to spend now to achieve the same standard of living that they had before the pandemic. Use the drop down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
KEY FINDINGS
29% - the increase in price that owner occupied households in London would see if they were to buy the same goods and services as they did in the three years to March 2020.
5 - the percentage point gap between increases in expenditure for the most and least impacted income groups, in London.
Inflation impact - the estimated percentage change in spending for London households, if buying the same goods and services (April 2020 - March 2024)
Price changes have impacted households in different tenure types differently. Over the last four years, price changes have been felt more acutely by those in households that are owned outright (i.e. with mortgages paid off), who have seen the price of their basket of goods and services rise by 29%, while private rented households and those owned with a mortgage have seen a 24% and 23% rise, respectively. Owned outright households had slightly higher expenditure to begin with and they started feeling inflation pressures more acutely than other groups in April 2021.
However, the spending habits of these groups are different, meaning that the rise in cost is likely to be felt very differently. For example, although the increase for private renters is less in total than for those who own their homes outright, a greater proportion of private renters' spending goes on essentials (food, energy and housing). This means that this group may find it harder to cut back. We explore this more in the following sections.
Go to the next section Pre-Pandemic Expenditure or scroll up and use the drop down menu to see the data split by income group, age group and poverty status.
This section takes London households’ basket of goods and services from before the pandemic and looks at the proportion they spend on different item groups in that basket. This allows us to see the differences in spending between different groups. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
Average weekly spending on goods and services as a proportion of all expenditure for household income quintiles in London - baseline (April 2017 - March 2020)
The biggest and most consistent inflation in prices throughout 2022 was in energy bills and food and non-alcoholic beverages, and the headline inflation figures were, to a great extent, driven by these increases. Households on lower incomes spent a much higher proportion of their total expenditure on these products. For London households in the lowest income category, expenditure on food and non-alcoholic beverages represents 17% of their total expenditure and expenditure on energy bills represents 7%. Households in the highest income category spent 8% of their total on food and only 3% on energy bills.
Average weekly spending on goods and services, in pounds, for household income quintiles - baseline (April 2017 - March 2020)
London households in the lowest income category spent £57 per week on food and non-alcoholic beverages and £23 on energy bills, while those in the highest income category spent £78 per week on food and non-alcoholic beverages and £24 on energy bills. The difference between income categories is larger in what could be considered non-essential spending, such as on restaurants and hotels and on recreation and culture. Those on the lowest incomes spent, on average £30 and £21 per week on these categories, respectively. In contrast, those in the highest income households spent £153 and £93, respectively.
Key findings
£57 and £78 - average weekly spend on food and non-alcoholic beverages by households in the lowest and highest income categories, respectively.
17% and 8% - the percentage of the total expenditure that this money represents for households in the lowest and highest income categories.
Total average weekly spending on goods and services, in pounds, by household income quintiles, in London and the rest of England - baseline (April 2017 - March 2020)
London households in the lowest income quintile spent an average of £336 per week before the pandemic on goods and services. Those in the highest income quintile spent £965 per week. Expenditure was higher in London than in the rest of England for each of the five income groups.
Differences in weekly average spending between high and low income London households and the median group, by type of product or service - baseline (April 2017 - March 2020)
Households on the lowest incomes spent less in total than the median and those on the highest incomes spent more. This is true for almost all spending categories. All households, regardless of income, spent a similar amount on energy bills, although this represents a varying proportion of their total expenditure.
Go to the next section Inflation Impact Tracker or scroll up and use the drop down menu to see the data split by age group, poverty status and type of tenure.
This section takes London households’ basket of goods and services from before the pandemic and looks at the proportion they spend on different item groups in that basket. This allows us to see the differences in spending between different groups. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
Average weekly spending on goods and services as a proportion of all expenditure for London households by age - baseline (April 2017 - March 2020)
London households headed by younger people spent over a quarter of their total expenditure on rent (29%), compared to households headed by older people, who only spent 5% of their total expenditure on rent. This difference is not necessarily offset by older groups being more likely to own their homes, as mortgage capital repayments, interest and other housing costs account for a much lower proportion of total spending for older age groups (7%). Additionally, it is this ‘essential’ spending that households have little control over. This might make it difficult for younger households to adapt their budgets in order to accommodate price increases in other products and services.
Younger-aged households also spent a lower proportion on food and non-alcoholic beverages (8% compared to 14%) and a similar proportion on restaurants and hotels (14% compared to 13%) as older-aged households.
Average weekly spending on goods and services, in pounds, for London households by age group - baseline (April 2017 - March 2020)
Households headed by people aged between 20 and 35 years old spent, on average, £211 on rents in the three years leading up to the pandemic (2020 Q1), making it the largest proportion of spending for that group. Households headed by people over 65, on the other hand spent, on average, £69 on recreation and culture and £63 on food and non-alcoholic beverages - representing the highest spending proportions.
Key findings
£211 - average weekly spend on rent by the youngest London households.
29% - the percentage of the total expenditure this represents.
Total average weekly spending on goods and services, in pounds, by household age, in London and the rest of England - baseline (April 2017 - March 2020)
In total, younger households tended to spend more on products and services than older ones. In the three years leading up to the pandemic (2020 Q1), households headed by 20 - 34 year olds spent, on average, £728 per week on such items, while those headed by over 65 year-olds spent £442. Spending was higher in London compared to the rest of England.
Go to the next section Inflation Impact Tracker or scroll up and use the drop down menu to see the data split by income group, poverty status and type of tenure.
This section takes London households’ basket of goods and services from before the pandemic and looks at the proportion they spend on different item groups in that basket. This allows us to see the differences in spending between different groups. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
Average weekly spending on goods and services as a proportion of all expenditure for London households by poverty - baseline (April 2017 - March 2020)
In the three years leading up to March 2020, almost half (47%) of the expenditure for London households in poverty was taken up by rents, food and non-alcoholic beverages and energy bills. This contrasts with less than a quarter of the expenditure (23%) for London households that are not in poverty.
Key findings
47% - is the percentage spent on essential items such as food and non-alcoholic beverages, rents and energy bills, by London households in poverty.
23% - is the percentage spent on the same items by London households not in poverty.
Average weekly spending on goods and services, in pounds, for London households by poverty - baseline (April 2017 - March 2020)
In the three years leading up to March 2020, London households in poverty spent, on average, £220 per week on food and non-alcoholic beverages, rents and energy bills. Households that were not in poverty spent £172 per week, on average, on the same items.
Key findings
£135 - average weekly spend on rents for London households in poverty.
29% - is the proportion of total spending this represents.
Total average weekly spending on goods and services, in pounds, by household poverty, in London and the rest of England - baseline. (April 2017 - March 2020)
In 2020, London households in poverty spent an average of £464 per week on the items that make up the “basket of goods” that inflation is measured on. Those not in poverty spent £737 per week. Expenditure was higher in London than the rest of England for both groups.
Go to the next section Inflation Impact Tracker or scroll up and use the drop down menu to see the data split by income group, age group and type of tenure.
This section takes London households’ basket of goods and services from before the pandemic and looks at the proportion they spend on different item groups in that basket. This allows us to see the differences in spending between different groups. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
Average weekly spending on goods and services as a proportion of all expenditure for London households by tenure type - baseline (April 2017 - March 2020)
In the three years leading up to March 2020, London households living in private rented housing spent 40% of their total expenditure on rent. This compares to 22% for households in the social rented sector. Households in the social rented sector spend the highest proportion on food (16%) and energy (7%).
In total, more than half of private renters' expenditure (52%) was spent on essentials (housing, food and energy), while those in the social rented sector spent 44%, mortgage holders 34% and outright owners 18%.
Londoners in social housing spent the lowest proportion on leisure activities - Recreation & culture and Restaurants & hotels combined make up 16% of social rented households’ expenditure, similar to private renters who spend 18% of their expenditure on leisure activities. This is compared to 31% for owner occupiers and 23% for mortgage holders.
KEY FINDINGS
40% - The proportion of private renting households’ expenditure that is spent on rent.
Average weekly spending on goods and services, in pounds, for London households by tenure - baseline (April 2017 - March 2020)
Londoners in private rented housing spent, on average, £288 on rents in the three years leading up to the pandemic (2020 Q1), making it the largest proportion of spending for that group (40%).
Mortgage holders had the highest level of spending overall, spending around £200 on housing costs (mortgage capital and interest as well as mortgage endowment policies) and a similar amount (£207) on leisure activities. Both spending figures represented just over 20% of their overall expenditure (22% and 23% respectively).
Londoners in social housing appear very squeezed, spending less than other households on many products and services. They spent £56 per week on food and £58 per week on leisure activities, each representing 16% of their total spending.
KEY FINDINGS
£288 - average weekly spend on rent by Londoners in private rental housing..
40% - the percentage of the total expenditure this represents.
Total average weekly spending on goods and services, in pounds, by tenure, in London and the rest of England - baseline (April 2017 - March 2020)
In total, mortgage-holding households tended to spend more on products and services than any other type of tenure. In the three years leading up to the pandemic (2020 Q1), mortgage-holding households spent, on average, £894 per week on such items, while those in social housing spent £352. Spending was higher in London compared to the rest of England.
KEY FINDINGS
£894- average weekly spending on products and services of London’s mortgage-holding households.
£352 - average weekly spending on products and services of Londoners in social housing.
Go to the next section Inflation Impact Tracker or scroll up and use the drop down menu to see the data split by income group, age group and poverty status.
SUMMARY
This section looks at how the prices that made up a household’s basket of goods and services in the three years to 2020 have changed. This allows us to look more specifically at how much a household now has to spend to get the same amount of food or energy, for example, as they were purchasing leading up to 2020. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
KEY FINDINGS
£18 - would be the weekly increase in energy bills for households with the lowest and highest incomes for the same consumption as in the three years to 2020 Q1.
5% and 2% is the contribution of this increase in energy bills to the total additional amount households on the lowest incomes now have to pay to maintain the same standard of living as in the three years to 2020 Q1. For households on the highest incomes, energy costs contribute 2% to the increase.
£19 and £25 - would be the weekly increase in food and non-alcoholic beverages for households with the lowest and highest incomes for the same consumption as in 2017-2020.
6% is the contribution of this increase in food and non-alcoholic beverages to the total additional amount households on the lowest incomes now have to pay to maintain the same standard of living as in the three years to March 2020. For households on the highest incomes, food and non-alcoholic beverages contribute 3% to the increase.
Inflation impact - percentage change in prices of goods and services for household income quintiles in London (March 2024)
There are differences in how much changes in the price of products and services contribute to a households’ overall spending increase and these depend on the original expenditure of each household. For example, essential items, such as bills and food, contribute a much higher proportion to the total increase in lower income households. The opposite is true for non-essential items.
If they were to purchase the same basket as in the three years leading up to March 2020, households on the two lowest income quintiles would see their basket increase in price by 27%. Essential items such as energy bills contribute 5% to this increase for the lowest income households and 4% for the second lowest, while spending on food and non-alcoholic beverages represents 6% and 5%, respectively. Recreation and culture price increases contribute only 2% to the total increase, while restaurants and hotels 3%, for both the lowest and second lowest income households.
In contrast, households in the highest income category would see a 25% increase in their basket price. Energy bills contribute 2% to this increase while spending on Food and non-alcoholic beverages 3%. Recreation and culture contributes 3% and Restaurants and hotels, 5%.
Inflation impact - estimated change in average weekly spending on goods and services for income quintiles in London (April 2017 to March 2020 and March 2024)
Households in the lowest income quintile now need to spend £76 to buy the same food and non-alcoholic beverage items that they bought for £57 pounds in the three years leading up to March 2020. They have to pay £41 to use the same amount of energy as they did leading up to 2020 Q1, when it cost them £23.
Households in the highest income quintile need to spend £103 in food and non-alcoholic beverages compared to £78 leading up to 2020 and £42 on energy bills compared to £24 in the three years to 2020 Q1.
This section looks at how the prices that made up a household’s basket of goods and services in the three years to 2020 have changed. This allows us to look more specifically at how much a household now has to spend to get the same amount of food or energy, for example, as they were purchasing leading up to 2020. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those on different types of tenure.
Inflation impact - percentage change in prices of goods and services for household age in London (March 2024)
If an older household (65 years and older) in London were to buy the same shopping basket as they did in the three years to March 2020 again in April 2023, they would see a 29% increase in price.
The biggest contributors to this increase is the rise in energy bills (4%) and food (5%), as well as restaurants and hotels and recreation and culture, contributing 4% and 5% respectively, to the overall increase.
The youngest households would have to spend 23% more to maintain the same standard of living as in the three years to March 2020. Rent (5%) and restaurants and hotels (4%) are the biggest contributors to this increase, with energy bills and public transport having contributed 2% each, to the overall increase in the price of their basket.
Inflation impact - estimated change in average weekly spending on goods and services for age in London (April 2017 to March 2020 and March 2024)
Older households need to pay an additional £20 each week, to buy the same food and non-alcoholic beverages as they did in the three years to March 2020 and to pay £19 more per week, on energy bills. Younger households need to pay £39 more on rent and £13 more on energy bills.
SUMMARY
This section looks at how the prices that made up a household’s basket of goods and services in the three years to 2020 have changed. This allows us to look more specifically at how much a household now has to spend to get the same amount of food or energy, for example, as they were purchasing leading up to 2020. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
KEY FINDINGS
£17 and £18 - the weekly increase in energy bills for London households in poverty and not in poverty if consuming the same as in the three years to March 2020.
4% and 3% - the contribution to the overall increase that these amounts represent.
Inflation impact - percentage change in prices of goods and services by household poverty in London (March 2024)
Whether or not households were in poverty or not did not have a noticeable effect on how much inflation impacted baskets of goods and services overall. Both groups would see their basket in the three years to March 2020 increase in price by around 25% if they were to purchase the same items again. However, the composition of this change is quite different for the two groups. The biggest increases for households in poverty have come from price rises in what can be thought of as essentials such as energy bills (which contribute 4% to the overall increase), food and non-alcoholic beverages (4%) and rents (5%). This is in contrast to households not in poverty, where essentials represent proportionally less of the total spend. While the overall increase in prices is very similar for both groups, households in poverty may find it difficult to reduce the current price of their basket by buying less quantity or trading down, without forgoing essential products and services.
Inflation impact - estimated change in average weekly spending on goods and services for poverty in London (April 2017 to March 2020 and March 2024)
Households in poverty would now have to pay £39 per week on energy bills in order to use the same amount of energy as in the three years to March 2020, when it cost them £22 - an increase of £17 per week. Households that are not in poverty would have experienced an increase of £18 (from £24 per week to £42 per week).
This section looks at how the prices that made up a household’s basket of goods and services in the three years to 2020 have changed. This allows us to look more specifically at how much a household now has to spend to get the same amount of food or energy, for example, as they were purchasing leading up to 2020. Use the drop-down menu to see the data split by income group, age group, those in and out of poverty and those in different types of tenure.
Inflation impact - percentage change in prices of goods and services for tenure in London (March 2024)
If a household in London that is owned outright (a household which is owned by the people living in it and whose mortgage has been paid off) were to buy the same shopping basket now as they did in the three years to March 2020, they would see a 29% increase in price.
The biggest contributor to this increase is the rise in Restaurants and hotels, which contributed 5% to the overall increase. Food and non-alcoholic beverages contributed 4% to that increase, energy bills 4%, and public transport 2%.
Social renting households have seen a smaller overall increase in the price of their 2020 basket of goods and services as those in outright owned households (27%). Energy bills (5%) and Food and non-alcoholic beverages (5%) are the biggest contributors to this increase.
Households in private renting would have to spend 24% more to maintain the same standard of living as in the three years to March 2020. Rents have contributed 7% to this increase, energy bills 2% and Restaurants and hotels 4%.
Inflation impact - estimated change in average weekly spending on goods and services for tenure in London (April 2017 to March 2020 and March 2024)
Households in private rented housing would need to pay an additional £53 each week, on average, on rent, compared to the three years to March 2020. They would need to pay £35 more per week, in order to do the same leisure activities as they did in the three years to March 2020.
Households that are owned outright would need to spend £22 more on food in order to be able to buy the same things as they did in March 2020 and £50 more in order to take part in the same leisure activities.
Households in social rented housing would need to spend £16 more on energy per week to be able to use the same amount as they did in March 2020.
Overview
This analysis explores what the impact of inflation would be if households were to continue spending in the same way as they did before the cost of living crisis. As such, it gives an indication of what impact inflation has had on the ability of households to maintain the same standard of living.
This is not an inflation measure in itself but tells us the effect that inflation has had on specific baskets of goods and services, that is, how much the prices that consumers pay for a specific shopping basket have changed over the last two years.
This allows us to understand how inflation affects different population groups and in the long run it will show how much prices have changed in total, even as inflation falls. Headline inflation figures alone will not give information about the price increases that remain after inflation has gone down.
One thing to keep in mind is that consumers change their behaviour when prices change. This means that the shopping basket of 2017-2020 will not be the same as the shopping basket today as many consumers will have made different choices in response to price rises. The analysis therefore cannot give us an exact picture of households’ current expenditure nor can it tell us how this has changed due to high inflation.
In addition, inflation indices represent average national prices, which means that we don’t have region-specific information on price changes. Therefore, it is likely that inflation figures underestimate London price increases, as the capital tends to be more expensive than the rest of the country. However, the analysis provides a useful reference point and contributes to our understanding of the impact of inflationary pressures on household spending.
Why this is needed
We are in a cost of living crisis and have been since late 2021 (Institute for Government). This has mainly been caused by high inflation outstripping wage increases - the Consumer Price Index, including housing costs (CPIH), has seen consistent month-to-month increases since March 2021. Prices of food and non-alcoholic beverages, housing and household services (driven mainly by energy bills), clothing and footwear, restaurants and hotels have all seen fairly consistent increases over the past year.
The Office for National Statistics (ONS) measures inflation by tracking the prices of several items in a "basket of goods" - as the price of the individual items change, so does the total price of this basket. The basket includes over 700 items ranging from food to rents. The ONS collects prices from different shops (e.g. supermarkets or off-licences) and in different parts of the country, which means that each month, around 180,000 prices are collected to calculate inflation.
Individual price changes are monitored monthly and presented in the form of a year-on-year change (inflation). This figure represents the percentage by which prices have increased for the whole of the UK population. However, these price increases are felt differently by different groups of people. The impact depends on people’s income and how much headroom they have to accommodate price increases, what they spend their money on and the part of the country in which they live. Also, inflation is not equal across products and services, so the headline inflation figure may be experienced as higher or lower depending on what households spend their money on.
We have conducted this detailed analysis to understand what these headline figures mean for the lived experience of certain population groups that are likely to be more seriously affected, with a focus on households in poverty or low incomes.
London had the highest rate of in-work poverty, when compared to the rest of the UK, which means that people living here could be particularly vulnerable to price increases. 41% of Londoners had an income below the minimum income standard in 2019 – this proportion has increased during the pandemic and through the current cost of living crisis. London also has much higher property prices than the rest of England and this can affect how inflation is felt. The price of rental properties is also increasing faster in London compared to the rest of the UK. Rents increased by 15% in inner London and 20% in outer London between 2014-19, compared to 10% outside of London. When surveyed, 24% of Londoners said they would not be able to afford an unexpected bill (this is similar to the UK average). Investigations by the Minimum Income Standard in 2019 revealed that it is up to 58% more expensive to reach a decent standard of living in London than in other urban areas of the UK, this is due to higher housing, childcare and transport costs.
Data
CLASSIFICATION OF INDIVIDUAL CONSUMPTION BY PURPOSE (COICOP)
This is the standard international classification of products and services for household expenditure. It is hierarchical, with individual items grouped into progressively higher categories. At its highest level, there are 13 categories (divisions) that describe all items of household expenditure.
We used the highest order categories to present expenditure data. We separated out some elements of division 04 (Housing, water, electricity, gas and other fuels), into the following categories: Rents (04.1 Actual rentals for housing), Mortgage interest and endowment policy premiums (04.2 Imputed rentals for housing), Energy bills (04.5 Electricity, gas and other fuels), House maintenance, water rates and council tax (all the rest 04 categories).
CPIH FIGURES, ONS
We used the disaggregated index of CPIH inflation available from the ONS. The index tracks price changes for each COICOP category as well as overall. The index base is in 2015 and we rebased this to the dates during which baseline expenditure data were collected (2017 Q2 to 2020 Q1).
LIVING COSTS AND FOOD SURVEY (LCFS)
We used three waves of the LCFS in order to have an adequate sample size. We decided not to use data collected during 2020/21 as pandemic lockdowns created exceptional circumstances; we instead used pre-pandemic data (2017/18 - 2019/20) as they were more representative of usual spending patterns. The survey runs in financial years, meaning that only 1-2 weeks out of the total of 36 months represented in the data we used, were impacted by lockdowns. We don’t expect this to affect our estimates significantly.
We extracted the LCFS expenditure variables that are included in each of the COICOP categories indexed in CPIH. We used COICOP+ codes to assign LCFS expenditure codes to COICOP class codes. This resulted in a long list of C- product codes, of which we only used the household totals (i.e. C- expenditure codes with a -t suffix). For expenditures without estimated totals in the LCFS, we used the Family Spending methods to calculate them.
We included mortgage capital repayment spending in the baseline expenditure, even though it is not tracked by CPIH, as it constitutes a big part of household spending. This expenditure remained the same at baseline and after inflation was applied. The household shopping baskets used in this project do not represent households’ total expenditure.
Read more about our approach in the Data & methods section. If you have any feedback on London's Cost of Living Tracker, we'd love to hear it.