Industry experts have urged the industry to respond to the government consultation on reforms to Retail Prices Index (RPI), emphasising the importance of engaging with members.

In a panel session at the PLSA Investment conference, Insight Investment head of solutions design, Jos Vermeulen, highlighted that the change was likely to have a “significant impact on more than 10 million people in the UK”, emphasising the importance of transparency with members.

Vermeulen stated: “The issue we have here is it’s a fairly complex story, and it’s not very transparent. The people who don’t know or understand what is happening, are ultimately impacted by this.

“So if that is the intention, be open and transparent, so that people can be aware. But at the moment, this is almost outside of the public, and therefore that’s where we have a challenge.”

Vermeulen added: "It’s a very serious issue, and hence people do need to consider the consequences and respond to the consultation, and ask your members to respond.

“People need to know about it to allow them the platform to make their voices known, if they’re not aware of this potential change”.

Vermeulen also added that whilst the inclusion of a "broader impact" section within the consultation was initially met with a "hopeful" reaction, it "almost said they’re likely to ignore the broader impact when they come up with a recommendation".

The section of the consultation referred to reads: “Responses in this section are unlikely to be relevant to the Chancellor’s decision regarding the Authority’s proposal to address the shortcomings of the RPI by improving the methods and data sources used in compiling the index; however, they may be relevant in wider policy contexts”.

Marks and Spencer head of pensions trust and chief investment officer, Simon Lee also highlighted the lack of inclusion of a section on potential compensation despite calls from the industry.

However, he acknowledged that many responses to the consultation may nonetheless focus upon this.

Vermeulen concluded: “We’d like to encourage as many of you to respond to the consultation. In 2012, it only took 406 responses to make a difference with CPAC, and this time around we believe we will need many more.

“We’re not arguing whether RPI is a good or bad statistic, all we are saying is that nobody needs to lose out as a result of this change.

“For example, the way that can be achieved is by aligning RPI with CPIH, plus a fair spread, where a fair spread is calculated by looking at historic difference.

“If there’s one message we would like to send you home with this week, its that RPI reform needs you.”

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