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The cost of living
and age pensioner households
Issue 4 2016
From data available in July 2016
About QCOSS
The Queensland Council of Social Service (QCOSS) is the state-wide peak body representing the interests of individuals experiencing or at risk of experiencing poverty and disadvantage, and organisations working in the social and community service sector.
For more than 50 years, QCOSS has been a leading force for social change to build social and economic wellbeing for all. With members across the state, QCOSS supports a strong community service sector.
QCOSS, together with our members continues to play a crucial lobbying and advocacy role in a broad number of areas including:
sector capacity building and support homelessness and housing issues early intervention and prevention cost of living pressures including low income energy concessions and improved
consumer protections in the electricity, gas and water markets energy efficiency support for culturally and linguistically diverse people early childhood support for Aboriginal and Torres Strait Islander and culturally and
linguistically diverse peoples.
QCOSS is part of the national network of Councils of Social Service lending support and gaining essential insight to national and other state issues.
QCOSS is supported by the vice-regal patronage of His Excellency the Honourable Paul de Jersey AC, Governor of Queensland.
Lend your voice and your organisation’s voice to this vision by joining QCOSS. To join visit the QCOSS website (www.QCOSS.org.au).
ISBN – 978-1-876025-90-8
© 2016 Queensland Council of Social Service Ltd. This publication is copyright. Non-profit groups have permission to reproduce part of this book as long as the original meaning is retained and proper credit is given to the Queensland Council of Social Service. All other persons and organisations wanting to reproduce material from this book should obtain permission from the publishers.
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ContentsAbout QCOSS..........................................................................................................2Contents...................................................................................................................3Executive summary..................................................................................................5A basic standard of living.........................................................................................6How are our model households faring?....................................................................8Change in overall budget position..........................................................................10Change in the cost of goods and services based on CPI.......................................11Change in expenditure for our model households..................................................14
Housing costs......................................................................................................16Automotive fuel and private motor vehicle costs.................................................19Council rates.......................................................................................................19Phone and internet..............................................................................................19Financial and insurance costs.............................................................................19Health costs........................................................................................................20Electricity costs, water and sewerage costs........................................................21
Year-to-year changes in income............................................................................22Age pension........................................................................................................22Commonwealth Rent Assistance........................................................................23Concessions........................................................................................................26
Recommendations.................................................................................................30Conclusion.............................................................................................................31
Page 3 / August Cost of living age pensioner households, Issue 4
FiguresFigure 1: Amount above and below a basic standard of living (per week), July 2016.................................................................................................................................8
Figure 2: Amount above and below a basic standard of living for four model households, July 2013 to July 2016.......................................................................11
Figure 3: Cumulative change in the cost of goods and services based on CPI, Brisbane, June 2011 to June 2016.........................................................................12
Figure 4: Annual change in the cost of goods and services based on CPI, Brisbane, June 2015 to June 2016.........................................................................................13
Figure 5: Average weekly rent by Brisbane region for one-bedroom units over five years (June 2011 to June 2016).............................................................................17
Figure 6: Average weekly rent by Brisbane region for two-bedroom units over five years (June 2011 to June 2016).............................................................................18
Figure 7: Proportion of expenditure by expenditure category, single renter July 2016................................................................................................................................23
Figure 8: Proportion of expenditure by expenditure category, couple renter July 2016................................................................................................................................24
Figure 9: Increase in the maximum rate of Commonwealth Rent Assistance versus rents in Brisbane (using rent category of CPI), March 2008 to June 2016.............25
Figure 10: Annual value of concessions for four example households, July 2016 27
Figure 11: Annual value of concessions (per person) for four example households, July 2016................................................................................................................28
Figure 12: Amount above and below a basic standard of living for four example households, with concessions and without concessions, July 2016 concession data compared with June 2016 income and expenditure data.......................................29
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Executive summarySignificant increases in the cost of living over recent years have indisputably impacted many Queenslanders. Unfortunately, it is low-income households who are most affected by the rising costs of essential goods and services and who are most at risk of falling into a cycle of poverty and disadvantage as a result of cost of living pressures.
Older Australians who rely on the age pension are one low-income group who are significantly impacted by cost of living pressures. In 2013, when our first age pensioner Cost of Living Report was released, there were 434,174 Queenslanders receiving the age pension.i This has now grown to 477,029 which represents an increase of 10 per cent over three years.ii This growth is expected to continue, with the Queensland Government estimating that the number of people aged 65-84 in Queensland will more than double from 491,000 in 2010 to 1.3 million by 2050. iii The cost of living pressures experienced by age pensioners in Queensland are therefore likely to affect a growing number of people and potentially place greater stress on social services in the future.
This report examines the incomes and expenses of four model age pensioner households to identify whether they can meet a basic standard of living. The report uses publicly available data to estimate the basic income and expenditure for four types of households. This is the fourth age pensioner Cost of Living Report compiled by the Queensland Council of Social Service (QCOSS) since 2013.
This report demonstrates that housing and utility costs continue to have a significant impact on the capacity of age pensioners to afford a basic standard of living. In particular, the study shows:
Rising housing costs and the battle to meet those costs is the single biggest financial burden for pensioners, especially for those who rent in the private market.
Single and couple households renting privately are most likely to be in housing stress (with almost 50 per cent of their gross income being spent on housing costs).
Our model couple age pensioners living in Brisbane who rent in the private market are not able to meet the costs associated with a basic standard living, and our model single renter is just able to meet their basic costs with only a few dollars to spare each week.
Without further support, renters who rely on the age pension in Brisbane will have to make tough choices about their expenditure, compromising their quality of life.
This report calls for urgent and targeted action to address the significant costs associated housing for Queenslanders dependent on the age pension, and makes recommendations to improve the affordability of other key expenses impacting pensioner households in Queensland.
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A basic standard of livingQCOSS has produced this Cost of Living Report – Special Edition: The cost of living and age pensioner households, Issue 4 to gain a better understanding of the capacity of age pensioners to meet a very basic standard of living.
As with QCOSS’ previous Cost of Living Reports, this report uses very modest estimates to determine a basic standard of living. A basic standard of living is defined as, “one that goes beyond survival (for example food, shelter and clothing) – it provides an opportunity for quality of life (incorporating health, safety, use of facilities and services, connecting with people, a holiday) and access to a modest number of things that contribute to social inclusion and wellbeing (such as recreation, entertainment and social outings).”iv
It is imperative to consider that the findings within this report are based on a very basic living standard, one that allows very little room for improvement or any buffer from unexpected costs. Put differently, even making do according to this standard still leaves one at constant risk of vulnerability.
In determining the income and expenditure, this report follows the methodology used in QCOSS’ previous Cost of Living Reports.v This is then modified to apply specifically to age pensioners through a set of assumptions relevant to each of the four model households.vi
To estimate expenditure, the report draws on data from the Australian Bureau of Statistics’ (ABS) Household Expenditure Survey (HES)vii. As the HES data is only collected every six years, this is adjusted using Consumer Price Index (CPI) data to account for changes in the cost of goods and services over time. HES data is supplemented with real data for rent, public transport, housing, and council rates and charges (including water and sewerage) as this is readily available. The data used is that available from July 2016 unless otherwise stated. To ensure the findings are consistent, data is for Brisbane only, unless otherwise stated. Income data is generated from the Centrelink Online Estimator, which provides up-to-date information on government pensions and allowances.viii This methodology provides a broadly realistic picture of expenditure and income, noting of course that the expenses of any individual or family will differ from the ‘model’ according to their specific experiences and circumstances.
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In 2011, the Productivity Commission noted that older Australians “generally want to remain independent and in control of how and where they live”. ix Therefore, the four model households used in this report live independently. The households include:
Barbara: aged 72, rents a one-bedroom apartment and relies exclusively on public transport
Pat: aged 69, owns a three-bedroom house (debt-free) and owns a small car
Charlie and May: aged 75 and 73, rent a two-bedroom apartment and rely exclusively on public transport
Liz and Bryan: aged 71 and 74, own a three-bedroom house (debt-free) and own a small car.
The main differences between each of these households are the number of people in the household, the type and size of their housing, whether they own or rent their home, and the type of transport they use. This necessitates some differences in the way income and expenditure is estimated.x As different assumptions are used for each household, caution should be used in comparing the outcomes across all households. Rather, the situation for each individual household should be compared with figures in subsequent QCOSS Cost of Living reports.
*Please note: Updates to our approachxi in this issue mean that care should be taken when comparing the data for the households in this report with previous reports in this series. Where comparisons are made between this report and earlier reports from 2013, 2014 and 2015, data has been updated to enable accurate comparison over time.
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How are our model households faring?The results in Figure 1 and Table 1 below provide a clear picture of the capacity of our four model households to afford the basics in life.
Overall, it appears our homeowner households can afford a basic standard of living, assuming there are no unexpected additional expenses incurred throughout the year.
Our home owner couple, Liz and Bryan, earn $84 per week more than a basic standard of living, or $42 per week per person.
Our single home owner Pat, earns $38 per week more than a basic standard of living.
However, the situation for our households who rent in the private market is untenable.
Our single renter Barbara, is able to meet a basic standard of living, however with only $5 per week to spare.
Renters Charlie and May, cannot afford a basic standard of living because they earn $31 per week less than is required.
As demonstrated by this data it is evident that those pensioners who rent privately are at greatest risk of poverty. The data demonstrates that many households in this situation would be required to forego certain basic goods and services in order to survive, as they simply do not have enough income to meet the costs for a basic standard of living.
Figure 1: Amount above and below a basic standard of living (per week), July 2016
Single renter,Barbara
Single homeowner,
Pat
Couple renters,Charlie and May
Couple homeowners,Liz and Bryan
-$40
-$20
$0
$20
$40
$60
$80
$100
$5
$38
-$31
$84
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Table 1: Weekly budgets for our four model householdsxii (accessible version in Appendix A)
July 2016 Single Couple
Renter, Barbara
Home Owner,
Pat
Renters, Charlie
and May
Home Owners, Liz and Bryan
Weekly
expenses Weekly
expenses Weekly
expenses Weekly
expensesFood and Drink $78 $78 $155 $155 Clothing and footwear $11 $11 $23 $23 Rent (including water) $245 $0 $325 $0 Electricity $17 $18 $19 $19 Household contents and other services $46 $59 $46 $59 Health $28 $28 $55 $55 Private motor vehicle $0 $76 $0 $76 Automotive fuel $0 $16 $0 $32 Transport $14 $0 $27 $0 Phone/Internet $9 $9 $18 $18 Recreation/Entertainment $25 $25 $55 $55 Annual Holiday and Travel $5 $5 $9 $9 Home and Contents Insurance $9 $14 $9 $14 Emergency savings $10 $10 $10 $10 Rates $0 $19 $0 $19 Water and Sewerage $0 $13 $0 $13 Household Maintenance and Repairs $0 $18 $0 $18
Total Expenditure $497 $399 $751 $575
Weekly income
Weekly income
Weekly income
Weekly income
Age Pension $397 $397 $599 $599 Pension Supplement $33 $33 $49 $49 Rent Assistance $65 $0 $61 $0 Other $7 $7 $11 $11 Tax $0 $0 $0 $0
Total Income $502 $437 $720 $659
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Weekly difference $5 $38 -$31 $84
Change in overall budget positionAll our model households have experienced improvements in their overall budget position compared to the first age pensioner Cost of Living Report released in August 2013. As Figure 2 below demonstrates:
Our couple homeowners, Liz and Bryan, experienced the largest improvement of $30 per week in their overall combined budget position between July 2013 and July 2016. Their budget position has steadily increased over time from $54 per week above a basic standard of living in 2013, to $65 above in 2014, $77 above in 2015 and $84 above in July 2016.
Our single homeowner, Pat, experienced the second largest improvement of $16 per week in her overall household budget position between July 2013 and July 2016. Her budget position has also steadily increased over time from $22 per week above a basic standard of living in 2013 to $28 per week above in 2014, $34 per week above in 2015 and $38 per week above in July 2016.
Our couple renter household, Charlie and May, have had their overall combined budget position increase by $25 per week between July 2013 and July 2016, however this is little comfort given they remain unable to afford a basic standard of living. Their overall budget position improved from $56 per week below a basic standard of living in 2013, to $43 below in 2014, $42 per week below in 2015 and $31 below in July 2016.
Our single renter household, Barbara, has had her overall budget position increase by just $1 per week between July 2013 and July 2016. Her overall budget position has fluctuated more than others over the past three years, decreasing from $4 per week above a basic standard of living in 2013 to $2 a week above in 2014 and then increasing to $10 per week above in 2015. However, her budget position has decreased this year, falling to just $5 above a basic standard of living in July 2016. This is in part due to variations in rental costs for one-bedroom apartments, as discussed in later sections of this report.
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Figure 2: Amount above and below a basic standard of living for four model households, July 2013 to July 2016.xiii
Single renter,Barbara
Single homeowner,Pat
Couple renters,Charlie and May
Couple homeowners,Liz and Bryan
-$80
-$60
-$40
-$20
$0
$20
$40
$60
$80
$100
$4
$22
-$56
$54
$2
$28
($43)
$65
$10
$34
-$42
$77
$5
$38
-$31
$84
2013 2014 2015 2016
Change in the cost of goods and services based on CPIFigure 3 below displays the cumulative changes in the price of selected goods and services over the past five years to June 2016. The graph demonstrates that the costs of essential goods and services have increased at a much faster rate than discretionary items.
It also demonstrates the limitations of using the overall CPI to determine how low-income households are faring and whether they are experiencing cost of living pressures. That is because low-income households typically spend a greater proportion of their income on essential items therefore they are disproportionately impacted when the cost of essentials outpaces overall CPI. It is critical then to examine the impact of changes to specific expenditure categories when analysing the impact of cost of living changes on low-income households.
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Our methodology uses CPI data to estimate expenses for some categories, but uses real data for expenses such as rent, public transport, rates, electricity and water and sewerage. As such, the increases in the CPI categories do not always align with the changes in the expenditure for our model households.
Figure 3: Cumulative change in the cost of goods and services based on CPI, Brisbane, June 2011 to June 2016
Electricity
Water and sewerage
Public transport fares
Health
Rent
Food
All groups CPI
Clothing + footwear
Furniture and furnishings
Major household appliances
Games, toys and hobbies
Audio visual and computer equipment
esse
nti
als
CP
Id
iscr
etio
nar
y
-60 -40 -20 0 20 40 60
49.6
31.7
17.3
26.4
9.6
1.4
9.4
3.9
4.7
1.2
-13.0
-39.2
%
Figure 4 below shows the change in the cost of essential items versus more discretionary goods and services between June 2015 to June 2016. This can be compared against the five-year cumulative changes in Figure 3 above, to demonstrate the current and emerging drivers of cost of living pressure for our four model households.
Based on the CPI data, there have been notable increases in the cost of essentials such as Water and Sewerage (2.7 per cent) and Health (4.3 per cent), both increasing above overall CPI this year. Two of the discretionary items listed (Furniture and Furnishings, and Clothing and Footwear) have also increased faster than overall CPI during the past year. This is in contrast to the previous five years where the change in the cost of these items was lower than overall CPI.
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Another notable change is the slowing increase in the cost of electricity. Electricity costs have been a key contributor to cost of living pressure for Queensland households for a number of years, so it is encouraging to see CPI increases contained to 1.4 per cent between June 2015 and June 2016.
This is a significant reduction when compared to the 49.6 per cent cumulative increase in electricity costs during the past five years which equates to 9.9 per cent per year on average. While prices have slowed in growth they remain at a very high level and persist as a point of acute cost of living pressure for many households. It is also worth noting that when we look at the expenditure of our households based on real electricity prices, the increase is higher than CPI suggests at between 2.8 per cent and three per cent, as described in the next section.
The CPI data also indicates that rent increases are slowing over time. According to CPI figures, the cost of renting in the private market in Brisbane increased by only 0.5 per cent between June 2015 and June 2016, compared to an increase of 9.6 per cent cumulative (or 1.9 per cent on average per year) between June 2011 and June 2016. Again however, when we look at the expenditure for our households which is based on real rental price data, the changes in rental costs for our households are different from what is suggested by the CPI data, as described in the next section.
Figure 4: Annual change in the cost of goods and services based on CPI, Brisbane, June 2015 to June 2016
Electricity
Water and sewerage
Public transport fares
Health
Rent
Food
All groups CPI
Clothing + footwear
Furniture and furnishings
Major household appliances
Games, toys and hobbies
Audio visual and computer equipment
esse
nti
als
CP
Id
iscr
etio
nar
y
-12.0 -10.0 -8.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 6.0
1.4
2.7
0.0
4.3
0.5
0.4
1.5
2.7
3.8
1.3
-3.7
-10.1
%
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Change in expenditure for our model householdsTable 2 on the following page demonstrates the impact to changes to different expenditure categories on the overall budget position for each of our four model households between July 2015 and July 2016.
Overall, all our model households experienced an increase in their overall costs during the year. Our single and couple homeowner households experienced increases of $147 and $140 respectively and our couple renters had an increase of $40 in their annual costs.
Single renter, Barbara, was hardest hit by increased expenditure of $710 over the year. This increase was driven mainly by increased rental costs as discussed the next section.
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Single renter (Barbara)
Single home owner (Pat)Pat
Couple renters (Charlie and May)
Couple home owners (Liz and
Bryan)
% change
/ year
$ change / year
% change / year
$ change / year
% change / year
$ change / year
% change / year
$ change / year
Food and drink 0.7% $30 0.7% $30 0.7% $60 0.7% $60Clothing and footwear 2.7% $15 2.7% $15 2.7% $31 2.7% $31
Rent 4.3% $520 n/a $0 -1.5% -$260 n/a $0
Electricity 2.8% $23 2.9% $26 3.0% $28 3.0% $28
Household contents and other services
2.5% $58 2.5% $74 2.6% $61 2.6% $77
Health 4.3% $60 4.3% $60 4.3% $119 4.3% $119
Private motor vehicle n/a $0 -3.5% -$144 n/a $0 -3.5% -$144
Automotive fuel n/a $0 -11.9% -$112 n/a $0 -11.9% -$225
Public transport 0.0% $0 n/a $0 0.0% $0 n/a $0
Phone / internet -7.2% -$37 -7.2% -$37 -7.2% -$73 -7.2% -$73
Recreation / entertainment 1.9% $25 1.9% $25 1.9% $54 1.9% $54
Annual holiday and travel 1.9% $4 1.9% $4 1.8% $8 1.8% $8
Financial and insurance 2.6% $12 2.6% $19 2.6% $12 2.6% $19
Emergency savings 0.0% $0 0.0% $0 0.0% $0 0.0% $0
Rates n/a $0 3.6% $35 n/a $0 3.6% $35Water and sewerage n/a $0 27.1% $141 n/a $0 27.1% $141
Household maintenance and repairs
n/a $0 1.1% $11 n/a $0 1.1% $10
Total Change in expenditure $710 $147 $40 $140
Table 2: Annual change in expenditure for example households, July 2015 to July 2016
Please note: Annual percentage and dollar amounts presented in Table 2 are based on unrounded weekly estimates. Annual estimates will differ from weekly estimates (such as those provided in Table 1, which are rounded weekly figures). This provides a more accurate reflection of the annual impact of changes in expenditure for each of the four households.
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Housing costsThe most significant cost impacting our households has been the changes in the cost of rent for our two renter households. These changes for those relying on the age pension have a high budget impact because rent makes up such a large proportion of their expenditure.
While the majority of people aged 65 and over in Australia own their own home, 14.5 per cent of people in this age category are renting, over half of which are renting in the private rental market.xiv These figures are actually likely to be higher in Queensland, as there are a higher proportion of renters in Queensland compared to other states. According to the Australian Bureau of Statistics, 27 per cent of Queensland households rent compared to 21.2 per cent across Australia.xv
While the CPI data indicates a slowing of rental cost increases this year, the rental cost information for our model households was sourced from the Residential Tenancy Authority (RTA) by using the median rent data published each quarter. This data indicates that there has been a 4.3 per cent rise in the cost of rent for our single renting household, which equates to a $10 increase per week. However, our couple renters experienced a 1.5 per cent (or $5 per week) decrease in their rental costs.
It should be noted that the method used to calculate an estimate of rent in this report can result in some fluctuation from year-to-year, which may not always accurately reflect reality. For example, the dramatic rise in the cost of rent for our single renter can be attributed to the data available for the cheapest one bedroom units in the Brisbane region. In calculating the estimated rent paid by each household, a ‘weighted average’ method was used by taking an average of the cheapest 300 properties in the Brisbane Council Area.
In June 2015, the cheapest suburb for a one-bedroom apartment averaged $180 per week based on 48 rental bonds lodged.xvi In June 2016, the cheapest suburb available averaged $156 per week but with only 5 rental bonds being lodgedxvii and the next cheapest suburb had rents averaging $200 with 14 bonds lodged.xviii
Overall, housing stress is a key concern for pensioner households who rent. Our report looks at the cheapest suburbs in Brisbane to provide a modest estimate of rental costs, however it should be noted however that the cheapest properties may not be appropriate for our households especially if they are not accessible for people with mobility issues.
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Further, most older people derive significant value from living in the same local area as they age, including experiencing a greater sense of community, access to a local network of supports and reduced social isolation resulting from living close to friends, family and accessible transport. This means not all pensioners will be able to take advantage of renting in the cheapest suburbs and may therefore have significantly higher rental costs than estimated by our methodology.
Additionally, the cheapest suburbs are not consistent over time. Generally, we could assume that most pensioner households would remain in the same property or suburb over time. However, our methodology is based on rental figures from the cheapest suburbs. This means the suburbs we assume our households live in also changes from year to year, even though it is not feasible that our pensioners would be constantly moving to take advantage of the lowest rents at all times. Figure 9 and Figure 10 below show how the average rental prices in different regions across Brisbane have changed during the past five years.
Figure 5: Average weekly rent by Brisbane region for one-bedroom units over five years (June 2011 to June 2016)
Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 150
170
190
210
230
250
270
290
310
330
Bayside Inner North Outer North Outer North WestInner South Outer South Inner South East Outer South West
Page 17 / August Cost of living age pensioner households, Issue 4
Figure 6: Average weekly rent by Brisbane region for two-bedroom units over five years (June 2011 to June 2016)
Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 250
270
290
310
330
350
370
390
Bayside Inner North Outer North Outer North West
Inner South Outer South Inner South East Outer South West
About household debt
It is important to highlight that an assumption is made in this report that our homeowner households are debt-free with no mortgage payments to be made. However, the proportion of pensioners who fully own their home is falling, with a shift towards more seniors with mortgages during retirement.xix
The most recent data available shows the proportion of older households who owned their homes without a mortgage decreased from 78 per cent in 2002 to 71 per cent in 2011xx, and we can assume this trend has continued to 2016. This may be relevant to consider in the methodology for future reports in this series once updated census data is available.
We also note that the methodology assumes $18 per week for home maintenance and repairs. At $936 per year, this is not a generous figure and depending on the age and quality of the home and fixed appliances, many homeowners are likely to have much higher maintenance costs than estimated.
While there is a trend of older households continuing to have mortgage debt into their retirement, there does not appear to be a broader trend towards any increase in the accumulation of other forms of debt by older households, such as credit card debt or payday loans. Households between the ages of 65 and 74 years have comparatively low levels of most forms of debt and those over 75 years appear the closest to being debt free of any age category.xxi This reflects anecdotal evidence from No Interest Loan Scheme service providers in Queensland who report that older households are generally less likely to take up an interest-free loan to purchase an essential item and more likely to simply “go without” until
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they can afford to purchase what they need.
Automotive fuel and private motor vehicle costsThe next biggest change since June 2015 has been a decrease in the cost of automotive fuels and private motor vehicle costs. Based on the CPI data, our single and couple homeowners both experienced a 11.9 per cent decrease in the price of fuel between June 2015 and June 2016. This equates to an overall budget decrease of $112 and $225 for the single and couple homeowners respectively. This is partially due to the global oil price dropping below $US30 a barrel in February 2016, resulting in the dramatic decrease in fuel prices.xxii In addition, there has been a significant decrease in private motor vehicle costs of 3.2 per cent, which is the equivalent of a $96 decrease since June 2015.
About fuel prices
Fuel prices are impacted, not only by the global oil price, but other factors such as the level of local retail competition and the cost structures and pricing strategies of wholesalers and retailers in the market.xxiii As a result, not all Queenslanders have benefited from the reduction in fuel prices shown in this report, which is based on Brisbane CPI data. Households in regional areas of Queensland typically pay higher fuel prices, for example in Cairns fuel prices are consistently higher than the rest of the country.xxiv Given the lack of accessible public transport options in many regional areas, the cost of fuel is likely to be a larger proportion of the overall expense for many households in regional Queensland compared to those in Brisbane. The Australian Competition and Consumer Commission (ACCC) has initiated a market study to investigate why petrol prices are higher in Cairns relative to the larger capital cities and to explain each component of the prices.xxv
Council ratesWhile changes to local council rates are a direct issue for our two home owner households, they also indirectly impact on renters as one of a number of pressures on rental prices. Council rates increased by 3.6 per cent for both of the single and couple home owners with a three-bedroom house at median value of residential land in Brisbane. This equates to an increased cost of $35 since June 2015 for both the single and couple homeowner households.
Phone and internetAnother significant change in costs for our households was for phone and internet services. Phone and internet costs have decreased by 7.2 per cent since the last report. This equates to a saving of $37 per year for our single households and $73 per year for our couple households when comparing between June 2015 and June 2016. The main contributor to the decline in the cost of phone and internet services is the continuing fall in telecommunication equipment and services costs.xxvi
Financial and insurance costsAnother significant change between June 2015 and June 2016 was for financial and insurance costs. Financial and insurance costs have increased by 2.6 per cent since
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the last report for all sample households. This equates to an increase of $12 per year for our renter households and $19 per year for our homeowner households when compared between June 2015 and June 2016.
Health costsHealth costs have also increased between June 2015 and June 2016. Each of the households experienced an increase in the cost of health care of 4.3 per cent since the previous report. This equates to $60 per year for our single renter Barbara and single homeowner Pat and $119 per year for our couple households.
It is important to note that changes in the cost of health care are taken from the CPI which includes costs associated with private health coverxxvii. This may not directly reflect health care costs for low-income households relying on the age pension who are less likely to have private health cover or use private hospital services.
About health costs
While these figures demonstrate how health costs have changed based on CPI, we know that actual health expenses can vary dramatically across pensioner households depending on their circumstances and life events. For example, Aboriginal and Torres Strait Islander people are affected by chronic health conditions associated with ageing earlier than non-Indigenous Australians and may therefore have higher than average health costs as a result.xxviii
Health costs can not only vary significantly across individuals, but can also be experienced as unexpected spikes in expenses that can dramatically change a households’ budget position. With three of our model households having only a slight surplus above a basic standard of living (and our couple renters not at all), an unexpected increase in health costs could have a significant impact on the cost of living and in some instances create a cycle of poverty which is difficult to recover from.
Our model households are based on people with good overall health and no ongoing health issues.
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Electricity costs, water and sewerage costsAs seen in Table 2, there has been an increase in the cost of electricity across all model households of between 2.8 per cent (for single renter) to three per cent (for our couple renters and couple homeowners). This exceeds the increase of 1.4 per cent shown in the CPI figures as it is based on actual electricity prices and estimated household consumption.
Electricity prices were deregulated in South East Queensland (SEQ) from 1 July 2016, so the prices used are the standing offer prices of the retailer with the largest market share in SEQ.
We note that for the first time our single renter household has higher electricity costs than they would if they were located in regional Queensland where prices are regulated by the Queensland Competition Authority. This is because the regulated prices have a lower fixed daily supply charge than the standing offer prices that apply to our model households based in SEQ. The Australian Energy Market Commission (AEMC) has identified that older person households are more likely to remain on higher priced standing offers, as they are less likely to shop around and switch retailers.xxix
Water and sewerage costs for our homeowner households have increased by a significant 27.1 per cent or $141 per year. Not all of this increase is driven by changes in water prices which increased by 2.3 per cent.
The majority of the increase is a result of changes to the Brisbane City Council Water and Sewerage Remission. From 1 July 2016, the Council has removed the remission for new customers and capped payments at $300 per year for existing customers (previously capped at $476 per year). Existing customers will continue to receive the 40 per cent remission off their total water and sewerage costs as long as they remain at their current address, but would be ineligible if they were to change address.
The $300 cap affects our model homeowner households and represents an increase in their water and sewerage costs of $132 per year (assuming they remain in their current home). Should they move into a new property, they would experience an increase of $432 per year (or $8 per week) in their water and sewerage costs as they would no longer be eligible for the concession.
About water charges for renters
It is important to note that our methodology assumes our renter households do not pay for water and sewerage. However, an increasing number of renters are being charged by their landlord for the cost of their water usage. This would represent an additional cost of $7 per week if our renter households were to be charged for their water use, which would mean our single renter, Barbara, would no longer be able to afford a basic standard of living and would be $2 below each week. This may be relevant to include in our methodology for future reports in this series should this trend continue.
Additionally, given these costs are passed on by the landlord, rather than billed by a water provider, our renter households would not be eligible for any government or
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local council rebates intended to assist pensioners with meeting this expense.
Year-to-year changes in incomeWhile some pensioners have access to superannuation or other forms of income in conjunction with the age pension,xxx many rely on the age pension as their primary source of household income.xxxi For more than 50 per cent of the people of eligible age, the age pension makes up between 80 and 90 per cent of income.
Reliance on the age pension can be influenced by a range of other circumstances. For example, older women are overrepresented as age pension recipients and are statistically more likely to receive the maximum rate. This is because it is more difficult for women to earn enough superannuation through either compulsory or voluntary contributions during the course of their working life.xxxii As such, it remains vital that the age pension is adequate and keeps pace with living costs.
Age pensionThe age pension is currently indexed twice each year by either the CPI or the Pensioner and Beneficiary Living Cost Index (PBLCI), whichever is highest. It is then checked against Male Total Average Weekly Earnings (MTAWE) to ensure that it is not lower than 41.76 per cent of MTAWE. If the age pension is lower than 41.76 per cent of MTAWE, this amount is used, instead of CPI or PBCLI, to set the couple rate for the age pension.
The single rate of pension is then set at 66.33 per cent of the combined couple rate. Because of this method it is more likely that the age pension will increase at a rate higher than CPI. xxxiii However as evident in the information provided within this report, it is clear that the current pension rate does not provide enough for some pensioners to afford a basic standard of living.
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Commonwealth Rent AssistanceIn 2013-14, there were approximately 10,400 people over the age of 65 receiving Commonwealth Rent Assistance in the Brisbane Council Area.xxxiv While some of these renters live in community housing, it can be assumed that most rent in the private market.
Much of the difficulty that renters have to face within the private rental market results from the high and increasing cost of renting coupled with the inadequate level of support provided.
CPI data demonstrates that the cost of rent in Brisbane has increased by 9.6 per cent during the past five years. However, it is evident that assistance provided through the Commonwealth Rent Assistance scheme has failed to keep up. As Figures 7 and 8 illustrate, our renting households are in severe housing stress paying between 43 and 49 per cent of their expenditure just to meet housing costs.
Figure 7: Proportion of expenditure by expenditure category, single renter July 2016.
49.3%
15.7%
9.3%
5.6%
5.0%
3.4%
2.8%
2.2%
2.0%1.8% 1.8% 1.0%
Rent (including water)
Food and Drink
Household contents and other services
Health
Recreation/Entertainment
Electricity
Public Transport
Clothing and footwear
Emergency savings
Phone/Internet
Financial and Insurance
Annual Holiday and Travel
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Figure 8: Proportion of expenditure by expenditure category, couple renter July 2016.
43.3%
20.6%
7.3%
7.3%
6.1%
3.6%
3.1%2.4%
2.5% 1.3% 1.2% 1.2%
Rent (including water)
Food and Drink
Recreation/Entertainment
Health
Household contents and other services
Transport
Clothing and footwear
Phone/Internet
Electricity
Emergency savings
Annual Holiday and Travel
Financial and Insurance
As almost half of our renter households’ expenditure is allocated towards rent costs. The increase in the cost of renting exceeds the increase in the level of CRA. As seen in Figure 9 below, the increase in the maximum rate of CRA from March 2008 to March 2016 is 21.6 per cent, however rents in Brisbane increased by 29.1 per cent between March 2008 and June 2016.
This clearly demonstrates that some age pensioners are paying higher amounts of income on rent, but are not being provided with enough assistance in order to cover those costs to an appropriate extent.
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Figure 9: Increase in the maximum rate of Commonwealth Rent Assistance versus rents in Brisbane (using rent category of CPI), March 2008 to June 2016
CRA Rents, Brisbane0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
21.6%
29.1%
The situation for our single renter, Barbara, illustrates this point. The annual increase in the cost of renting a one-bedroom unit or apartment makes up a significant portion of her overall change in expenditure over the year. As one bedroom units in the cheapest suburbs to rent in Brisbane have increased on average by $10 per week, it is clear that her current budget position is not sustainable. In addition, it shows how inadequate the CRA scheme is in coping with an increase of this size. The rental cost for the cheapest suburbs in Brisbane on average for a one-bedroom unit has increased by $520 in a year. The income assistance provided by CRA does not come near that.
This situation is slightly better for our couple renters, Charlie and May. They experienced a decrease of $260 in their annual rent costs. However, their rental cost remains a significant proportion of their overall expenses and means they are experiencing housing stress.
It is likely that the clear mismatch of income versus expenditure would make it difficult for some renter households to sustain accommodation appropriate to their needs. In particular, our single renter, Barbara, has suffered an increase in her overall expenditure with the increase in rent making up the greatest proportion of that increase. Substantial numbers of older private renters live in fear of eviction and unaffordable rent increases; and lack flexibility within their rental agreements to make modifications to properties to accommodate mobility issues.xxxv This shows that a more targeted approach is required to enable our renters who rely on the age pension to meet rental costs for appropriate housing in Brisbane. However, without an increase in income assistance, our households have limited options available to them, typically worsening their standard of living in order to afford housing.
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The first option is to reduce their costs by living in smaller or substandard accommodation. This means that Barbara, Charlie and May would be living in conditions that do not meet community expectations for a quality of life with dignity.
A second option would be to forego a number of other essential items required to meet a basic standard of living. This is also clearly not tenable nor is it desirable as it may mean foregoing food, medicine, clothing or other items or by becoming more socially isolated by reducing transport costs or recreational expenses.
Another option is to move to an area, outside of Brisbane, where housing is cheaper. Unfortunately, these areas may leave our households, especially Barbara, more isolated. She might find it more difficult to access essential services or incur higher transport costs to access vital services. In addition, many elderly Australians have lived or rented in the same house for decades and would be disadvantaged if they were to relocate as they would lose the strong connections, built over time, with their home and local community including relationships with local services, including GPs and hospitals.
Accessing social housing where the cost of renting is much cheaper would provide another alternative. However, there continues to be a significant lack of available and appropriate public housing in Queensland. With the Department of Housing and Public Works estimating that 15,891 households were on the waiting list for social housing in Queensland of which 3,274 of the individual applicants were people over the age of 55.xxxvi
ConcessionsThe financial stresses experienced by our model households would be much worse if they did not benefit from several Queensland Government and local council concessions. Currently, age pensioners are eligible to receive a number of concessions on electricity, car registration, public transport fares, council rates, water charges and the Emergency Management, Fire and Rescue Levy.
The value of concessions is set by various means. The Queensland Government’s Electricity Rebate is increased in line with changes in electricity costs for a ‘typical’ residential customer as determined by the Queensland Competition Authority each year. This year the rebate increased by 2.8 per cent in line with the rise in regional Queensland electricity prices on average from 1 July 2016.xxxvii
However, the Queensland’s Government’s Pensioner Water Subsidy of $120 per year has not increased since it was introduced, despite water and sewerage costs increasing by 31.7 per cent during the past five years.
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A number of concessions are percentage-based, and thus do not need to be indexed each year. For example, pensioners receive a discount of 50 per cent off adult Public Transport fares, 40 per cent off Rates and Water and Sewerage Charges from Brisbane City Council and 20 per cent off the Emergency Management, Fire and Rescue Levy. These concessions ensure that pensioners receive assistance that adjusts in line with increases (or decreases) in costs over time.
Figure 10 and Figure 11 below show the extent of concessions available to each household on an annual basis per household and per person. Figure 10 shows the impact of concessions on each of our four households’ capacity to meet a basic standard of living. As can be seen, the total value of concessions available for each household is considerable and helps to improve the budget bottom line of each of the four households.
Figure 10: Annual value of concessions for four example households, July 2016
Single renter Single owner Couple renter Couple owner$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
$330 $330 $330 $330
$708
$1,416
$150 $150
$467 $467
$420 $420 $1,038
$1,406
$1,746
$1,406 Water concession
Rates and Fire Levy concession
Public Transport Concession
Car registration concession
Electricity Rebate
Total
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Figure 11: Annual value of concessions (per person) for four example households, July 2016
Single renter Single owner Couple renter Couple owner$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,038
$1,406
$873
$703
Our couple renters, Charlie and May, receive the highest value of concessions as a household. This is because they use more public transport and thus receive a greater value from concession fares for public transport. According to our methodology, Charlie and May receive $1,746 worth of concessions combined. 81 per cent of the value of these concessions comes from public transport and the other 19 per cent is from the Electricity Rebate. However, on a per person basis Charlie and May receive the second lowest annual amount of concession per person per year at $873 per person. Without any concessions, they would be earning $65 per week less than a basic standard of living. However, even with these concessions, Charlie and May still do not earn enough to warrant them a basic standard of living, being $31 below per week.
Both of our homeowner households received $1,406 worth of concessions per year combined as recorded in July 2016. On a per person basis our homeowner couple, Liz and Bryan, received the lowest amount in concessions at $703 per year. As seen in Figure 12 below, without concessions our single homeowner, Pat, would be only $11 above a basic standard of living, while Liz and Bryan would be $57 above.
If our single renter, Barbara, went without any concessions she would be in a much worse state financially than what she is in with concessions. With concessions she is only $5 per week above a basic standard of living. Without concessions however, Barbara would be $15 below a basic standard of living. This highlights how critical concessions are for age pensioner households.
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It is clear from this analysis that government and local council concessions play a significant role in supporting age pensioners to meet a basic standard of living. It also demonstrates that percentage based concessions can be more effective in ensuring that the assistance provided adjusts as the cost of living increases over time.
About the uptake of concessions
It should be noted that being eligible does not necessarily mean that all age pensioners will be in receipt of these concessions. An investigation in 2008 by the Australia Institute across four Centrelink payments found that 168,000 Australians were missing out on assistance to which they were entitled with the unused benefits totaling $623 million.xxxviii
Some of the reasons for the lack of uptake included lack of awareness about available assistance, the complexity of paperwork and people dropping off systems due to failure to renew their concessions status periodically. Factors that can inform awareness include literacy levels, language barriers, level of education, awareness within social networks, and support available to lodge a claim.
With the shift towards providing information about concessions online, it is important that older Queenslanders are provided with accessible information and support to claim the benefits to which they are entitled.
Figure 12: Amount above and below a basic standard of living for four example households, with concessions and without concessions, July 2016 concession data compared with June 2016 income and expenditure data.
Single renter Single owner Couple renter Couple owner-$80-$60-$40-$20
$0 $20 $40 $60 $80
$100
$5
$38
($31)
$84
($15)
$11
($65)
$57
With concessions Without concessions
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RecommendationsState and federal governments assist age pensioners by providing base pensions and allowances and through delivering of a range of targeted rebates, concessions and subsidies. While there is no doubt that these initiatives have a positive impact on age pensioners, as demonstrated in the previous figures, QCOSS is concerned that the allowances, rebates, concessions and subsidies provided to age pensioners are not sufficient to keep pace with increases in the cost of living, and especially the cost of essentials.
Evidently, those at the lower end of the socio-economic spectrum are battling to meet a basic standard of living, especially those who are renting in the private market. With almost half of our renter households’ budgets taken up with rental costs and the average price of rent increasing by $10 per week for our single renter, it is clear that action is needed to assist age pensioners who are unable to afford appropriate housing in the private rental market.
Based on the analysis in this report, QCOSS has a number of recommendations to improve access to affordable and appropriate housing and utilities for people relying on the age pension.
Recommendations for affordable and appropriate housing
review the level and indexation of Commonwealth Rent Assistance (CRA) available to age pensioners with the view to ensuring that assistance is adequate for households living primarily on the age pension and that it remains adequate over time.
This would require increasing the maximum rate of CRA immediately and indexing future payments to the rental component of CPI (rather than overall CPI) to ensure the CRA keeps pace with rental prices.
investigate options to improve access and secure tenure to more appropriate public and community housing for age pensioner households, considering approaches such as inclusionary zoning.
Inclusionary zoning has been used by the South Australian Government making social housing a mandatory component of all new developments, with 15 per cent affordable housing required, including five per cent for those on very low incomes. Similarly, Western Australia has a target of 15 per cent affordable housing in government-led development.xxxix
Public and community housing must be appropriate in size, accessible for older Australians with mobility issues, and located in areas of high connectivity for social inclusion and easy access to services.xl
Investigate options to stimulate private sector investment in housing that is affordable and appropriate for age pensioners. This can be achieved in a range of ways such as reinstating the National Rental Affordability Scheme (NRAS) or similar scheme. Other options have also been discussed in QCOSS’s submission to the Queensland Government’s Housing Strategy Discussion Paper. xli
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Recommendations for more affordable utilities
monitor the uptake of government concession or support programs against the number of people eligible. This will help to identify where there may be problems with awareness or uptake. Concessions must be well-promoted with information accessible in formats appropriate for older Queenslanders and support available to access concessions where required.
ensure all concessions provide an appropriate level of assistance and include transparent mechanisms to cope with the fluctuating costs of essential goods and services over time.
the Queensland Government index its Pensioner Water Subsidy and extend eligibility to renters who pay their landlord for their water usage.
local governments and water utilities should investigate options for assisting low income water users – including both home owners and renters – to cope with the rising costs of water. This may include providing concessions or implementing other proactive hardship measures such as Centrepay.
the Queensland Government must ensure the effective monitoring of electricity price outcomes for low-income households, including age pensioner households, following the removal of retail price regulation in SEQ from July 2016. This includes identifying the outcomes for pensioners and improving protections and support should adverse outcomes be identified.
ConclusionWhile this report provides a useful snapshot of the cost of living pressures experienced by age pensioners, it is important to recognise there are a diversity of experiences and outcomes for age pensioners across the state depending on their individual experiences and circumstances.
For example, age pensioners living in rural, regional and remote parts of Queensland are likely to face very different cost of living pressures and may be in significantly worse budget positions as a result.
Culturally and Linguistically Diverse households or Aboriginal and Torres Strait Islander households may experience additional barriers to accessing concessions which is likely to impact of their cost of living outcomes.
It is important to consider not only the outcomes for age pensioners in broad terms, but also the outcomes for those who may experience multiple disadvantage due to gender, isolation, impairment or life circumstance.
Age pensioners are clearly significantly impacted by cost of living pressures and especially the rising cost of rent and other essentials.
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It is imperative that all levels of government work together to ensure age pensioners are able to afford a basic standard of living for a life with dignity.
Appendix A - weekly budgets for our four model householdsBarbara’s weekly expenses and income.Barbara, our single renter has weekly expenses in the following areas:
$78 Food and Drink $11 Clothing and footwear $245 Rent (including water) $17 Electricity $46 Household contents and other services $28 Health $0 Private motor vehicle $0 Automotive fuel $14 Transport $9 Phone/Internet $25 Recreation/Entertainment $5 Annual Holiday and Travel $9 Contents Insurance $10 Emergency savings $0 Rates $0 Water and Sewerage $0 Household Maintenance and Repairs
This gives a total expenditure of $497 per week.
Her total weekly income is achieved through: $397 Age Pension $33 Pension Supplement $65 Rent Assistance $7 Other $0 Tax
Making her total Income $502 per week.
The difference is $5 – meaning that Barbara is $5 above a very basic standard of living.
Pat’s weekly expenses and income.Pat, our single person who rents has weekly expenses in the following areas:
$78 Food and Drink $11 Clothing and footwear $0 Rent (including water) $18 Electricity $59 Household contents and other services $28 Health $76 Private motor vehicle
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$16 Automotive fuel $0 Transport $9 Phone/Internet $25 Recreation/Entertainment $5 Annual Holiday and Travel $14 Contents Insurance $10 Emergency savings $19 Rates $13 Water and Sewerage $18 Household Maintenance and Repairs
Making her total weekly expenditure $399.
Her total weekly income is achieved through: $397 Age Pension $33 Pension Supplement $0 Rent Assistance $7 Other $0 Tax
This makes her total income $437, giving her $38 more than a basic standard of living.
Charlie and May’s weekly income and expensesOur couple renting, Charlie and May have weekly expenses in the following areas:
$155 Food and Drink $23 Clothing and footwear $325 Rent (including water) $19 Electricity $46 Household contents and other services $55 Health $0 Private motor vehicle $0 Automotive fuel $27 Transport $18 Phone/Internet $55 Recreation/Entertainment $9 Annual Holiday and Travel $9 Contents Insurance $10 Emergency savings $0 Rates $0 Water and Sewerage $0 Household Maintenance and Repairs
Making total weekly expenditure $751.
Their income: $599 Age Pension $49 Pension Supplement $61 Rent Assistance $11 Other
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$0 Tax This gives them a total income of $720, leaving them $31 short being able to afford a basic standard of living.
Liz and Bryan’s weekly expenditure and incomeOur home owners Liz and Bryan have weekly expenditure in the following areas:
$155 Food and Drink $23 Clothing and footwear $0 Rent (including water) $19 Electricity $59 Household contents and other services $55 Health $76 Private motor vehicle $32 Automotive fuel $0 Transport $18 Phone/Internet $55 Recreation/Entertainment $9 Annual Holiday and Travel $14 Contents Insurance $10 Emergency savings $19 Rates $13 Water and Sewerage $18 Household Maintenance and Repairs
This means they are spending a weekly total of $575.
Their income is: $599 Age Pension $49 Pension Supplement $0 Rent Assistance $11 Other $0 Tax
This gives them a total weekly income of $659 and putting them $84 above a very basic standard of living.
Back to Change in overall budget position .
Page 34 / August Cost of living age pensioner households, Issue 4
i Department of Social Services 2013. ‘DSS Demographics September 2013’. https://www.data.gov.au/dataset/dss-payment-demographic-data
ii Department of Social Services 2016. ‘DSS Demographics March 2016.’ https://www.data.gov.au/dataset/dss-payment-demographic-data
iii Queensland Government; ‘Queensland Commission of Audit – Final Report, February 2013 Volume 2’; Page 11. http://www.parliament.qld.gov.au/Documents/TableOffice/TabledPapers/2013/5413T2499.pdf
iv Queensland Council of Social Services 2015. ‘Cost of Living Report – Special Edition: The cost of living and age pensioner households, Issue 3 2015.
v For further details of this method please refer to Queensland Council of Social Service 2011. Cost of Living Report. Issue 1, June http://www.qcoss.org.au/content/cost-living-report-issue-1-may-2011
vi All cost estimates rounded to nearest dollar. A year based on 26 fortnights, 52 weeks, or 365 days. Emergency savings. Assumed to be $500 per year/$10.00 per week for a household. Rent. Assumption about dwelling type - 3BR house for home owners, 2BR apartment for couple renters and 1BR apartment for single renter. Electricity. Origin Energy Standing Offer prices for 2016/17. All households receive electricity rebate. Use average household use in Queensland of 4053 kwh/year. Assume single renter uses 70 per cent of average consumption, single home owner uses 75 per cent of average consumption and couple renter and home owners use 80 per cent of average. Transport. Assume single and couple renters rely solely on public transport – one round trip over four zones and three round trips over two zones per person per week all with concession and in off peak. Rates Use Average Rateable Value (ARV) for Brisbane from Valuer General and 2016-17 Brisbane City Council rates charges. Assume eligibility for pensioner remission for rates charges from both state and local government and pensioner subsidy for Emergency Management, Fire and Rescue Levy. Water and Sewerage Water use from National Water Commission. Assume age pensioner usage at 75 per cent of Brisbane average. Water and sewerage based on charges for Brisbane in 2016-17 from Queensland Urban Utilities. Assume eligibility for state and local government rebates and subsidies. Other estimates. Food, alcohol, clothing, recreation, annual holiday, private motor vehicle and automotive fuel based on spending by the second income quintile of the 2009/10 HES survey. Health, household contents and services and phone/internet based on spending of people receiving age pension from the 2009/10 HES survey. House and contents insurance based on spending in Brisbane from the 2009/10 HES survey. Queensland data is used where possible (QLD), but Australia-wide data is used for disaggregated items (AUS). The $ amount from the HES is adjusted by the relevant CPI component inflator for Brisbane, using the index values for June 2010 (the base year for the 2009/10 HES survey) and June 2016. Income. The Centrelink Online Estimator was used to estimate government support payments as at July 2016. The main inputs were rent (see cost estimates) and age.
vii Expenditure data is drawn from households in the second income quintile as this is representative of households on low incomes. In some
instances, expenditure data is used specific to age pension where this is deemed more relevant. In one instance, expenditure data specific to households in Brisbane is used to give a more households who receive the accurate representation of the cost of house and contents insurance.viii
Centrelink online estimator https://www.centrelink.gov.au/RateEstimatorsWeb/publicUserCombinedStart.doix
Productivity Commission 2011. Caring for Older Australians. Productivity Commission Inquiry Report Overview No. 53, 28 June 2011 http://www.pc.gov.au/__data/assets/pdf_file/0016/110932/aged-care-overview-booklet.pdf x For example, our home owner households have additional expenses associated with council rates and charges and household maintenance
and repairs but do not have significant ongoing housing costs, such as those associated with renting a property, and are therefore ineligible for Commonwealth Rent Assistance.xi Amendments to the approach include applying the Brisbane City Council Water Remission to our homeowner households and adding metering charges to the 2015-16 electricity service fee which were not included in the 2015 report.
xii Note: Concessions and subsidies that relate to specific expenditures have been incorporated into the expenditure figures.
xiii The historic overall budget positions for our home owner households have been updated in this edition with amendments as per endnote 11.
xiv Council of the Ageing 2013 Budget Submission 2013. http://cotaqld.org.au/wp-content/uploads/2012/01/COTA-Qld-GovtBudget-Submission-2013-14.pdf
xv Data from the ABS shows that Queensland has one of the highest proportion of renters of any state and territory with 27 per
cent of households renting compared to 21.2 per cent across Australia. Source: Australian Bureau of Statistics 2011
Household Income and Income Distribution Australia 2009-10. Cat No. 6523.0
xvi Data sourced from the suburbs Mansfield, Mt Gravatt and Wishart. Residential Tenancy Authority. (RTA). 2016. ‘2015 Median rents quarterly data: Brisbane.’ https://www.rta.qld.gov.au/Resources/Median-rents/Median-rents-quarterly-data/2015-Median-rents-quarterly-data
xvii Data sourced from the suburbs Northgate. Residential Tenancy Authority. (RTA). 2016. ‘2016 Median rents quarterly data: Brisbane.’ https://www.rta.qld.gov.au/Resources/Median-rents/Median-rents-quarterly-data/2016-Median-rents-quarterly-data
xviii Data sourced from the suburbs Altandi, Macgregor, Robertson and Sunnybank. Residential Tenancy Authority. (RTA). 2016. ‘2016 Median rents quarterly data: Brisbane.’ https://www.rta.qld.gov.au/Resources/Median-rents/Median-rents-quarterly-data/2016-Median-rents-quarterly-data
xix Council of the Ageing 2013. Housing Policy Submission. http://cotaqld.org.au/wp-content/uploads/2014/02/2013_12_COTA-Qld-Housing-Policy-submission.pdf
xx Australian Institute of Health and Welfare 2015. Australia’s Welfare 2015 ‘Growing Older’ http://www.aihw.gov.au/australias-welfare/2015/growing-olderxxi ABS, 4102.0 Australian Social Trends 2014. http://www.abs.gov.au/ausstats/[email protected]/Lookup/4102.0main+features502014#dowe
xxii Hinchliffe, Jessica. ‘Petrol prices tipped to drop below $1 per litre in Queensland, RACQ says.’ ABC News 24. http://www.abc.net.au/news/2016-01-19/price-of-petrol-could-drop-below-dollar-a-litre-in-queensland/7097656
xxiii ACCC, 2016. About Fuel Prices. https://www.accc.gov.au/consumers/petrol-diesel-lpg/about-fuel-prices
xxiv Vlasic, K. 29 July 2016. The Cairns Post. Cairns Motorists urged to have their say on fuel prices. http://www.cairnspost.com.au/business/cars/cairns-motorists-urged-to-have-their-say-on-fuel-prices/news-story/2de76ce45e0a2277804649542a0b3b13
xxv ACCC, 2016. Market Study on Petrol Prices in Cairns. https://consultation.accc.gov.au/regulated-infrastructure/market-study-on-petrol-prices-in-cairns/
xxvi Australian Bureau of Statistics 2016 6401.0 - Consumer Price Index, Australia, Mar 2016 http://www.abs.gov.au/AUSSTATS/[email protected]/allprimarymainfeatures/938DA570A34A8EDACA2568A900139350?opendocument
xxvii Australian Bureau of Statistics 2015 6401.0 - Consumer Price Index, Australia, Jun 2015 http://www.abs.gov.au/ausstats/[email protected]/Latestproducts/6401.0Main%20Features2Jun%202015?opendocument&tabname=Summary&prodno=6401.0&issue=Jun%202015&num=&view=
xxviii Australian Institute of Health and Welfare 2015. Ibid.
xxix AEMC, 2015, Final Report, 2015 Retail Competition Review. p57. http://www.aemc.gov.au/Markets-Reviews-Advice/2015-retail-competition-review/Final/AEMC-Documents/Final-Report.aspx
xxx Unfortunately, households that rent are generally on lower incomes than those that own their homes resulting in lower superannuation balances Source: CPA Australia 2012. Household savings and retirement: Where has all my super gone? Oct 2012 https://www.cpaaustralia.com.au/~/media/corporate/allfiles/document/professional-resources/superannuation/household-savings-retirement.pdf?la=en
xxxi As recent research has shown some households are using their superannuation to pay off mortgages after living beyond their means in the period before retirement, leaving them to become solely reliant on the age pension for their retirement income. Source: CPA Australia 2012. Household savings and retirement: Where has all my super gone? Oct 2012 Ibid ^.
xxxii Marie Coleman AO PSM and Helen Hodgson; ‘WOMEN'S VOICES: Report from consultations on factors influencing women's decisions on work-force attachment, including tax and transfers Including technical analysis and recommendations’; September 2011. http://www.actu.org.au/media/349567/national-foundtion-for-australian-women-womens-voices.pdf
xxxiii Parliament of Australia 2014. ‘Pension indexation: a brief history’ http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/FlagPost/2014/April/Pension-indexation
xxxiv Department of Social Services 2014. ‘LGA by Commonwealth Rent Assistance and age group - March 2013 Quarter.’ http://www.abs.gov.au/ausstats/[email protected]/mf/6523.0
xxxv Communities, Disability Services and Domestic and Family Violence Prevention Committee, Report No. 2, 55th Parliament. August 2015. Inquiry into the adequacy of existing financial protections for Queensland’s seniors. http://www.parliament.qld.gov.au/documents/tableOffice/TabledPapers/2015/5515T876.pdf
xxxvi Department of Housing and Public Works 2015. Social Housing Register. https://data.qld.gov.au/dataset/social-housing-register/resource/c9f174a3-8a53-49d5-a583-52e6f7453078
xxxvii Queensland Competition Authority, May 2016. Regulated Electricity Prices 2016-17. http://www.qca.org.au/Electricity/Regional-consumers/Reg-Electricity-Prices/Final-Report/Regulated-Electricity-Prices-2016-17
xxxviii The Australia Institute, 2010. Missing Out: Unclaimed government assistance and concession benefits. https://www.melbourneinstitute.com/downloads/hilda/Bibliography/Other_Publications/pre2010/Baker_Unclaimed_governernment_assistance_TAI_PB14.pdf
xxxix QCOSS, 2016. Response to Housing Discussion Paper: Policy and program options generated through engagement. https://www.qcoss.org.au/response-housing-discussion-paper-policy-and-program-options-generated-through-engagement
xl Queensland Shelter 2009. Positively ageless: Developing a Queensland seniors’ strategy. http://www.qshelter.asn.au/files/Seniors%20Submission%2016%20Dec%2009.pdf
xli QCOSS, 2016. Ibid.
Disclaimer: The material contained in this Report has been developed by the Queensland Council of Social Service Inc. The opinions, comments and/or analysis expressed in this document are those of the authors and do not necessarily represent the views of the State Minister, nor Department of Communities, Child Safety and Disability Services, and cannot be taken in any way as expressions of government policy. The Queensland Government doesn’t guarantee or accept any legal liability or responsibility for the accuracy, completeness, nor usefulness of any information disclosed in this report. The Queensland Government recommends that users exercise their own skill and care with respect to their use of this paper and that users carefully evaluate the accuracy, completeness and relevance of the material in the paper for their purposes and where necessary obtain any appropriate professional advice relevant to their particular circumstances.
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