Vinnies says costs hit poor where it hurts

This week's CPI figures come on top of a sustained growth in cost burdens on some of the poorest groups in Australia, according to research released by the St Vincent de Paul Society.

The annual inflation rate dropped from 3% in the September quarter of 2005 to 2.8% in December, according to figures released on Wednesday by the Australian Bureau of Statistics.

Headline inflation was 0.5% in December, down from 0.9% the previous quarter, reflecting falling prices for health, transport, clothing, audio-visual and petrol during the last three months of 2005.

But in Social Policy Issues Paper 2, Winners and Losers: the story of costs, Vinnies Researcher, Gavin Dufty fond that since 1990 there has been a growth in inequality due to changes in the cost burdens of various goods and services.

"These cost pressures have especially hit the aged, parents and those reliant on the rental housing market and public transport," he says.

For larger families any increases in the costs of food, clothing and footwear, utilities, education and childcare produce a disproportionately heavy impact since these households and heavier consumers of these items.

Similarly, Aged and Disability Support Pensioners feel a greater impact from the increases in the costs of food, utilities and health services.

Since 1990, childcare costs rose at at a rate 2.09 times (109%) greater than the inflation rate.

"[This week's] CPI figures do not tell the whole story when it comes to the daily strugges of the people we assist" said Vinnies' John Falzon. "We also expect that recent Welfare and IR reforms will further reduce the chances of low income families to pay for the essentials on a day to day basis."

"Costs hit poor where it hurts" - Vinnies (St Vincent de Paul Society 25/1/06)

LINKS (not necessarily endorsed by Church Resources)
Winners and Losers: The Story of Costs (St Vincent de Paul Society 19/12/05)

Low inflation cuts risk of rate rise (The Australian 26/1/06)

27 Jan 2006