In good news for older Australians, living costs for age pensioner and beneficiary households dropped for the first time since 2020.
Costs fell 0.1 per cent in the December 2024 quarter according to the latest data from the Australian Bureau of Statistics (ABS).
Michelle Marquardt, ABS head of prices statistics offered some insight into what was behind the much-needed financial relief amid rising living costs.
“Lower prices for electricity due to the 2024-25 Commonwealth Energy Bill Relief fund rebates impacted living costs this quarter. These lower electricity prices largely offset rises in other areas of living costs,” Marquardt said.
Living costs were also influenced this quarter by an increase in Commonwealth Rent Assistance (CRA), particularly for age pensioners and other pensioner or beneficiary households.
The CRA boost helped reduce rent costs for eligible households. From September 20, 2024, the maximum CRA rate increased by 10 per cent, in addition to the usual biannual cost-of-living adjustment (CPI).
Government payment recipients also saw a decrease in health costs, as more households reached the Pharmaceutical Benefits Scheme (PBS) safety net, lowering their out-of-pocket expenses for medicine.
The news will no doubt be welcomed by those on the age pension after a recent report found that more retirees are experiencing financial stress, finding that the age pension is no longer enough to meet even basic needs.
This alarming trend came to light in the latest Cost of Living Longer Report 2024, commissioned by Australian Seniors in partnership with research group MyMavins.
The study surveyed over 1,000 Australians aged 50 and above, revealing the impact of inflation and rising costs on those relying on the age pension.
Alarmingly, the study found that nearly three in five (58 per cent) are facing moderate to severe financial challenges due to rising costs, with one in 10 (10 per cent) experiencing severe difficulties.
With the cost of living continuing to climb, seven in 10 (69 per cent) now fear that the age pension alone will not be enough to live on.
The financial strain has left nearly three in five (59 per cent) struggling to pay for essentials such as utilities and groceries.
Even more concerning, one in five (20 per cent) have delayed or forgone medical treatment due to costs, placing their health at risk.
Understandably, these difficulties are taking an emotional toll, with around two in five (43 per cent) reporting a decline in their quality of life over the past two years. For 21 per cent, this decline has been considerable or severe.
Carolyn McColl, President of the Board for Meals on Wheels NSW, expressed deep concern over the findings, calling for urgent action.
“The aged pension is no longer sufficient to meet basic living expenses, with rising costs forcing many elderly Australians to make significant sacrifices,” McColl said.
“Since the onset of COVID-19, nearly every aspect of daily life — groceries, utilities, fuel, council rates — has seen substantial price increases, leaving little to no room for essentials such as medical care or social engagement.
“Some are unable to afford heating during winter, while others rely on Meals on Wheels for affordable, balanced meals. Urgent action is needed to address this issue —either through a reduction in living costs or an increase in the aged pension— to ensure older Australians are treated with the respect and care they deserve, rather than being left behind.”