PASSWORD RESET

Magazine of the Socialist Party, Australian section of the CWI

The crippling cost of living

For many decades Australia was considered to be the “lucky country”. This myth, perpetuated by the ruling class, was designed to make us think that we were much better off than workers in other countries. But the idea that we are lucky today has diminished.

The last 20-30 years have seen a significant deterioration in our living conditions, public services and wage levels. Additionally, costs of living have soared and we feel less secure and more stressed. Recent data confirms the true extent of how all this is impacting on us.

A recent report from the Australian Bureau of Statistics (ABS) shows that cost of living, particularly for families, is rising faster than wage increases.

The consumer price index (CPI) increased by 2.1% in the last year while cost of living expenses increased between 2.3% and 2.7% depending on your household type. Clearly the most vulnerable, those dependent on government benefits, are the most affected.

Workers meanwhile saw just a 1.9% increase in wages during the same period.

A recent Household Financial Comfort survey also found a significant decrease in savings per household. Increased costs have meant that money we would like to have saved has actually been spent on day-to-day expenses including food, transport and utilities.

Household debt has increased more than income in the last 30 years all around the world, but particularly in Australia due to the overvalued housing market. The ABS states that working households with a mortgage spend 8.2% of weekly income on interest charges alone! And this is despite currently low interest rates.

Privatisation, which saw many services such as gas, electricity, water and telecommunications taken out of public hands and sold off to profiteers, has led to a huge spike in the costs of these services. Many more people are now reluctant to turn on heating or cooling when needed.

Electricity costs alone have increased by 63% in the last decade! Most of us understand the feeling of dread when the power bills come in, but pensioners, who survive on an income below the poverty line, are particularly affected.

While much of the health sector is still publicly owned, it has suffered many cuts by stealth. Many private doctors no longer bulk bill and the public hospitals are under enormous strain. According to the Australian Institute of Health and Welfare, one million Australians put off seeing a doctor in the last year as they could not afford to do so.

Those that did attend the doctor were often out of pocket anywhere between $20- $500, with the average cost being $142.

Many other charges also continue to rise. A survey conducted by the Australian Scholarships Group found that the cost of public education for a child today in Victoria from pre-school to year 12 is around $68,000 in the metropolitan area! A huge amount for the average working family.

Adding to the problems, for those on welfare, payments have not risen in real terms for many years. Some groups such as the South Australian Council of Social Services have called for a $75 a week rise in unemployment benefits.

$75 a week would help, but it would not go anywhere near far enough. An increase of at least $250 a week would be needed to lift welfare recipients out of the poverty they have been pushed into.

It is an outrage that in such a rich country, that has not had a recession for more than 25 years, people are doing it so tough.

The blame for all this can be traced back to the policies implemented by the major parties in the service of big business. Privatisation, cuts to welfare, a reduction of social services and low wage growth have all been part of a decades-long plan to transfer wealth from ordinary people to the rich.

It’s worked: wealth inequality is now at record highs.

But we cannot let this go on any longer. We need to put an end to crippling cost of living pressures and reverse the trend towards wealth inequality. This will be best done by people coming together to campaign in a collective way against these policies and for a bigger share of the wealth.

While fighting for improved living conditions, we should also set out to deal with the source of our problems – the capitalist system that puts profits before all else. A socialist society would instead use the wealth created for the benefit of all.

By Denise Dudley