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APPENDIX UPDATE ON 2012 REVIEW COMMITMENTS


COMPLETE/NEARING COMPLETION

The Producer Price Index (PPI) and International Trade Price Index (ITPI) 2012 Review commitments that are complete or nearing completion:

• From the September quarter 2012, the indexes represent an industry, rather than a product (primary to an industry) view.
• From the September quarter 2012, the ABS re-weighted the individual PPIs and SOP indexes based on the latest available Input-Output (I-O) tables (i.e. in respect of 2007-08). The Stage of Production (SOP) indexes are now classified according to the Australian and New Zealand Standard Industrial Classification, (ANZSIC) 2006 edition (cat. no. 1292.0).
• From the September quarter 2012, the ABS has increased the collection of price observations in the third month of the reference quarter to ensure full quarter coverage.
• The ABS has delayed the timing of the PPI and ITPI publication releases by nine working days, aligning with the National Accounts and Balance of Payments input deadlines.
• The ABS fully incorporated the use of the Export Price Indexes (EPIs) and the Import Price Indexes (IPIs) (i.e. the ITPIs) in the compilation of the National Accounts and the Balance of Payments chain volume measures (CVMs).
• The ABS harmonised the index reference periods for PPIs (including the SOP indexes), ITPIs and the Consumer Price Index. These series are presented on an index reference period of 2011-12 = 100.0.
• The ABS adopted 2008 System of National Accounts (SNA) terminology when referencing indexes that align with the 2008 SNA. This resulted in some changes to PPI series titles, details of which appear in the outcomes paper.
• The ABS PPIs for retail trade margins commenced on 25 February 2014.
• The ABS PPIs will continue to support the compilation of the National Accounts and Balance of Payments.
• The ABS will continue to improve the coverage of the PPIs in line with the 2008 SNA I-O framework by progressively developing new price indexes, in line with the priorities detailed in the review.
• The ABS will increase the frequency of re-weighting the PPIs in line with international recommendations to update weights at a minimum of once every five years. The ABS is undertaking additional research to firm up the possibility for more frequent PPI re-weighting. The schedule of release of the National Accounts I-O tables will influence this outcome. The re-weighting frequency of the ITPIs will remain annual.
• The services prices index development program will continue to improve the coverage of the PPIs and ITPIs to reflect the contribution of services to the economy.
• Price indexes for Construction; Transport, Postal and Warehousing; and Information Media and Telecommunications products are currently under development.
• The ABS will provide further clarification on the concept of the SOP indexes in the Explanatory Notes of the publication Producer Price Indexes, Australia (cat. no. 6427.0) and within an updated Producer and International Trade Price Indexes: Concepts, Sources and Methods publication, which will be released on 20 August 2014.

• Due to the timing of input data receipt from survey respondents, the current period retail trade margins data will not be available to be incorporated in the suite of PPIs for publication at the same time as all other PPIs. The ABS is exploring options for a more timely inclusion of retail trade margins price indexes.
• The introduction of a new computer system will allow the coverage of the PPIs to include non-market price indexes.
• The ABS will broaden the scope of the ITPIs to include International Trade in Services. The ITPIs will change to being aggregated using weights aligned with Balance of Payments and International Investment Position Manual, sixth edition (BPM6) concepts.
• It is the aim of the ABS that the PPIs and ITPIs are able to be revised to accommodate improved data in subsequent quarters. To minimise the impact on those who use the indexes for contract indexation, once revised, indexes will be considered final (barring significant error and respondent corrections). The time period that the statistics will remain open to revision is subject to further investigation. The revisions strategy is dependent on the development and implementation of a new computer system, which is reliant on ABS 2017 outcomes.