Anglicare Australia鈥檚 new report, which documents how people on low incomes often end up paying more for basic goods, suggests cutting the Stage 3 tax cuts and regulating food and energy prices.
, released on September 12, points out that those who are already poor pay a price for being poor. It鈥檚 called a 鈥減overty premium鈥.
The report identified food, credit and finance, transport, data and communications, energy and insurance as key areas where the already poor are being hit the hardest in the cost of living crisis.
Rents have risen, on average, by 11% this year and interest costs are set to double by 2024.聽Food聽prices聽are also聽辞耻迟辫补肠颈苍驳听颈苍蹿濒补迟颈辞苍.
The report found that poor people prioritise housing costs, then bills and debt repayments, and compromise on transport and food.
While some people can cut back on discretionary items, the report said 鈥渇or the lowest-income households, there has never been room in the budget for these kinds of luxuries鈥.
鈥淢ore than two million households in Australia have run out of food in the last year due to limited finances. A staggering 72% of respondents [on Centrelink payments] regularly skipped meals.鈥
Food insecurity is worse in rural and remote areas, where prices can be up to three times more than in cities.
The report compared common items from Coles supermarkets: it found that prices for those who can鈥檛 afford to bulk purchase rose by 20鈥95%.
For example, a 20-pack of聽toilet paper聽cost $11 (31垄 per 100 sheets), while a 6-pack cost $6.50 (60垄 per 100 sheets) 鈥 a 93% poverty premium. Five hundred grams of beef mince cost $14 a kilogram, while a 1.9kg value pack cost $11.50/kg 鈥 a 22% poverty premium.
Meanwhile in transport, a daily Myki pass in Naarm/Melbourne costs $9.30 a day, while聽an annual pass costs $1794 ($7.47/day), a daily saving of more than $2.
Older cars use, on average, an extra litre of petrol every 100 kilometres. The report noted that this adds an average 10% 鈥減overty premium鈥 on to those who don鈥檛 have a newer model.
Similarly, the costs of energy, internet, car and home insurance and mobile data are essentials that poorer people pay more for.
But this is not聽why聽people are poor, the report notes. It points to the low rate of welfare payments, the high cost of housing, insecure jobs and stagnating wages as the key drivers.
It said 鈥渢he poverty premium stretches already impossible budgets to breaking point鈥.
More than 3 million people are living below the poverty line, and the 鈥渄epth of poverty鈥 has been growing.
The poverty gap 鈥 the difference between the poverty line and the average weekly income of people in poverty 鈥 has risen from $168 a week in 1999 to $304 a week this year.
At the same time, the rate of JobSeeker and other welfare payments has fallen to less than half the poverty line, even with聽尝补产辞谤鈥檚听辫补濒迟谤测听$56-补-蹿辞谤迟苍颈驳丑迟听谤颈蝉别.
鈥淚t is now so low it fails to perform that core function [of providing a safety net], and people are unable to afford basics.鈥
The rise in precarious and insecure work, along with stagnating wages, is increasing poverty: 37% of people in poverty live in households where wages are the main source of income.
The report recommended raising welfare payments above the poverty line; boosting the minimum wage; scrapping the Stage 3 tax cuts; regulating telecommunications and energy costs; and a national food security strategy.
鈥淭he number one action we can take to lessen the impact of the poverty premium is lifting every Australian out of poverty,鈥 it concluded.聽