The Manx Government is to change the way in which the Retail Price Index (RPI) measure of inflation is calculated.

Currently, the government calculates three measures of inflation - the Consumer Price Index (CPI), RPI and RPI using the Jevons formula.

CPI is its preferred measure. But RPI was still used for some calculations. For example, last year’s water rates rise was based on the higher RPI rate.

In December, inflation was 4.1% as measured by CPI but RPI was 6.9%. RPI Jevons, however, was 3%.

From April, government will publish only two measures of inflation in economic statistics - CPI and RPI calculated using Jevons. The government said the old way of measuring RPI overstates the effects of price changes.

Policy and Reform Minister Chris Thomas MHK said: ’Ultimately, no two people experience the same inflation as they consume different goods and services.’

He said he hoped by 2019 it should be possible to calculate separate inflation indices for different sectors of the population.