Inflation figures are done by trying to work out the average spending by all Australian households; the cost of living figures however split up the households into groups. They do this because obviously a household with people working are going to have different spending habits that retirees, or those on government benefits.
Also importantly the cost of living measures count the cost of repaying a mortgage, whereas the CPI figures do not. And because this year there have been interest rates cut, that has meant the cost of living for those with a mortgage has gone up by less than overall inflation. The impact is biggest for “Employee Households” because they are the ones most likely to be paying off a mortgage, whereas those who are on the age pension or other government benefits are much less likely to have a home loan.
While inflation in the year to September grew 3.2%, the cost of living for employee households rose just 2.6%.
The news was not so good for those who neither have a mortgage or who spend more of their income on necessities. As we noted last week, the big driver of inflation was electricity prices, rents, and other necessities. As a result, those who do not get the benefit of the falling interest rates saw their cost of living rise by more than inflation.
Under One Nation’s policy, the gas industry would not pay anything for at minimum 10 years – which is why it hasn’t kicked up a fuss. What Hanson has done, is show that Labor and Liberal are the only ones who see the status quo as the way forward. The gas industry knows that, so it is supporting the circuit breaker, which makes it seem like something is being done.
Prime Minister Anthony Albanese is facing backlash after quoting inaccurate statistics from the gas lobby, while defending his decision not to impose a 25% tax on gas exports in the federal budget. Mr Albanese was interviewed on radio during a post-budget trip to Perth, during which he claimed that “gas companies paid $22 billion of tax last year”. The $22 billion figure is not an official estimate by the Australian Taxation Office (ATO), but a figure produced by a gas lobby group.
