20th Apr 2019
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Rising food costs put most pressure on retirement tribes
Rising food costs put most pressure on retirement tribes

The Consumer Price Index (CPI) rose 0.5 per cent in the December quarter of 2018.

There were significant price drops in the telecommunications and transport categories. Telecommunications saw the biggest fall (-1.3 per cent) while the smaller drop in transport costs (-0.7 per cent) was driven by cheaper automotive fuel as petrol prices fell from recent highs.

The big price increases were in alcohol and tobacco, recreation and food.

The extra cost in the alcohol and tobacco category was driven by additional tax on tobacco.

Recreation price rises were driven by increases in the cost of domestic holiday accommodation (+6.2 per cent).

The food and non-alcoholic beverages category was affected by price rises for fruit (+5 per cent) due to more expensive lemons, apples, bananas and strawberries. Also, meat costs continued to rise as a result of the drought.

The quarterly figures affected the tribes differently.

Affluent Couples and Constrained Couples experienced the smallest cost-of-living increases at 0.3 per cent each.

Affluent Singles experienced a 0.4 per cent increase, primarily due to rises in recreation costs, while a hike in food costs was the main reason for a 0.4 per cent rise for Constrained Singles.

Food costs were also the prime driver of increases for Cash-Strapped Couples and Singles (both at 0.5 per cent).

Overall, food costs had the biggest impact with falls in the price of transport offsetting rises for the Affluent and Constrained tribes.

Housing is still a pressure point for Cash-Strapped tribes, but much less so for Affluent and Constrained tribes.

In the past 12 months, the Cash-Strapped tribes and Constrained Couples were most affected by cost-of-living increases, mainly due to food and petrol price rises.


This article first appeared in the March 2019 Retirement Affordability Index.





    COMMENTS

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    MICK
    21st Apr 2019
    10:07am
    The claimed CPI is a fraud. Anybody who shops or pays the bills knows that because everything costs more every other month and even belt tightening is not working.
    Food? Yes I've seen those rising over a decade. Significant rises which are never reported as such. Of late fresh food has in many cases doubled in price and the drought is either the excuse or the reason or both for this rise. The question is will prices come down when it rains again....or will Woolies and Coles reduce their prices? Unlikely.
    Governments need to stop pandering to big business and start regulating them when they behave in predatory ways. Sure profit is their reason for existence but when Australians are held to ransom with basic foodstuffs we do need regulation or a way to bypass the big players milking both farmers and their customers.
    Old Man
    21st Apr 2019
    8:14pm
    MICK, we have had some agreement on parts of this topic in the past. What is in the "basket" and, more importantly, what is left out that affects retired people. Here is the broad list of goods in the "basket":-

    "The basket of goods includes basic food and beverages such as cereal, milk, and coffee. It also includes housing costs, bedroom furniture, apparel, transportation expenses, medical care costs, recreational expenses, toys, and the cost of admissions to museums also qualify. Education and communication expenses are included in the basket's contents, and the government also includes other random items such as tobacco, haircuts, and funerals."

    I don't see electricity costs nor fuel costs although "transportation expenses" may cover fuel but my guess is that it doesn't. We need a "basket" that reflects the modern consumer which includes volatile costs such as electricity and gas.
    SFR
    21st Apr 2019
    11:01am
    A report I read 2 days ago about the stoush between Mars pet food and Uncle Toby’s cereals stopping supply to Woolies & Coles unless they received pricing increases will only increase prices to the consumer. Other suppliers may follow suit if they can apply pressure.
    Watch for food increases next quarter.
    Charlie
    21st Apr 2019
    11:02am
    The native tribes are restless, they have no shoes, must they go bare foot.
    ardnher
    21st Apr 2019
    2:22pm
    in our household we are managing very well and I actually save money without trying. is not how much you earn/get it is how you manage it.
    Foxy
    21st Apr 2019
    10:05pm
    ...... has this chart been fabricated by some "bod" living in la la land??

    Singles who rent at a cost of $160.38 per week????? hahahahahaaaa Now that's funny!!

    Where are these people living that pay $160? Tent City?? Certainly not capital city/suburbs!


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