Negative inflation

Those who live from past savings are one group who have suffered during the attack on recession, as interest rates have sunk close to zero. The one crumb of comfort is that since RPI is now in negative territory, although not CPI which is Brown's preferred definition, their costs are going down. (Of course OAPs are something of an exception, - the items which they spend most on - council tax, fuel and power, etc, are not going down.)

The government has decided, to save money presumably, that many benefits will not be increased this year. This includes Disability Allowance, Carer's Allowance and statutory Maternity Allowance. The principle here is the negative RPI, but since many of this group are pensioners, or have similar needs, they are not encountering falling prices for important goods and services.

The remarkable thing is that the old age pension is to be increased, and by 2.4%. So if OAPs faced the negative RPI for all their expenditure, they would be enjoying a rise in pension of 2.4 + 1.4, or 3.8 %.

Has the Government slipped up here, or has it accepted the argument that the RPI facing pensioners is very much in positive territory?

Or is the explanation that there is an election coming soon?