THE LIVING COST INDEXES – SUMMARY COMMENTARY – Extract
The Living Cost Indexes (LCI) have been designed to answer the question:
‘By how much would after tax money incomes need to change to allow households to purchase the same quantity of consumer goods and services that they purchased in the base period?’
In the June quarter 2018, the living costs of employee households and self-funded retiree households rose 0.4%. Over the same period, pensioner and beneficiary households (PBLCI) and other government recipient households rose 0.3%. The living costs of age pensioner households rose 0.2%. For more information about the June quarter 2018 results see Main Contributors to Change.
These differences arise for a number of reasons. The inclusion of mortgage interest and consumer credit charges and the different treatments of housing and insurance costs in the LCIs result in variations between the LCIs and the CPI series. The expenditure patterns of those households measured by the LCIs differ from those of the overall household sector in scope of the CPI; these also contribute to differences in the percentage changes.
OVERVIEW OF THE SELECTED LIVING COST INDEXES, AUSTRALIA – EXPLANATORY NOTES – Extract
- The Selected Living Cost Indexes (SLCIs), Australia incorporates the Pensioner and Beneficiary Living Cost Index (PBLCI) and the Analytical Living Cost Indexes (ALCIs). The ALCIs have been compiled and published by the ABS since June 2000 and were developed in recognition of the widespread interest in the extent to which the impact of price change varies across different groups of households in the Australian population.
- ALCIs are prepared for four types of Australian households: employee households (i.e. those households whose principal source of income is from wages and salaries); age pensioner households (i.e. those households whose principal source of income is the age pension or veterans affairs pension); other government transfer recipient households (i.e. those households whose principal source of income is a government pension or benefit other than the age pension or veterans affairs pension); and self-funded retiree households (i.e. those households whose principal source of income is superannuation or property income and where the Household Expenditure Survey (HES) defined reference person is ‘retired’ (not in the labour force and over 55 years of age)).
- The PBLCI was introduced in the June quarter 2009 and is a measure of the effect of changes in prices on the out-of-pocket living expenses experienced by the following two groups of households in the Australian population:age pensioner households, and other government transfer recipient households.
- The ABS publishes these indexes quarterly in Selected Living Cost Indexes, Australia (cat. no. 6467.0).
- Households have been categorised based on the principal source of household income, derived from the 2015-16 Household Expenditure Survey (HES).
SOURCE: Australian Bureau of Statistics. “How Have Your Living Costs Changed.” ABS no. 6467.0 – Selected Living Cost Indexes, Australia, June 2018
Produced by the librarians at the Brotherhood of St Laurence in Melbourne, Australia