Selected Living Cost Indexes, Australia

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Living Cost Indexes (LCIs) measures the price change of goods and services and its effect on living expenses of selected household types

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Reference period
March 2021
Released
5/05/2021
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Key statistics

Weighted average of eight capital cities, All groupsDec Qtr 2020 to
Mar Qtr 2021
% change		Mar Qtr 2020 to
Mar Qtr 2021
% change
Selected Living Cost Indexes (LCIs) - Household type:  
 Pensioner and Beneficiary LCI (PBLCI)

0.7

0.6

 Employee LCI

0.5

0.0

 Age Pensioner LCI

0.9

0.5
 Other Government Transfer Recipient LCI

0.6

0.7
 Self-funded Retiree LCI 0.71.3
Consumer Price Index (CPI)0.61.1

In the March 2021 quarter, all five living cost indexes rose:

  • Transport was the main contributor for three out of the five population sub-groups. Price rises in automotive fuel are due to a recovery in oil consumption resulting in higher world oil prices.
  • Health also contributed to the rise, increasing across all population sub-groups. The re-setting of the Pharmaceutical Benefits Scheme (PBS) and Medicare safety net on 1 January increased the cost of prescription pharmaceutical products and medical and hospital services.

Main contributors to change

Percentage change, Commodity group -December Quarter 2020 to March Quarter 2021
Weighted average of eight capital citiesPensioner and beneficiary LCIEmployee LCIAge pensioner LCIOther government transfer recipient LCISelf-funded retiree LCIConsumer Price Index (CPI)
       
Food and non-alcoholic beverages0.40.40.40.30.40.4
Alcohol and tobacco0.00.40.30.00.50.3
Clothing and footwear-0.30.30.0-0.50.30.5
Housing (a)-0.70.3-0.8-0.60.20.1
Furnishings, household equipment and services-0.4-0.2-0.4-0.3-0.5-0.2
Health6.11.65.67.62.52.0
Transport4.13.33.94.23.23.2
Communication0.40.50.40.40.50.5
Recreation and culture0.0-0.20.00.1-0.2-0.2
Education1.00.8-1.11.11.20.4
Insurance and financial services (b)-0.6-1.4-0.4-0.8-0.60.1
All groups0.70.50.90.60.70.6

(a) New dwelling purchase by owner-occupiers are included in the CPI but excluded from the Selected Living Cost Indexes.
(b) The Selected Living Cost Indexes includes interest charges and general insurance. Interest charges are excluded from the CPI and general insurance is calculated on a different basis.

Transport

  • Rose for all household types due to an increase in automotive fuel prices. World oil prices continue to recover following large price falls in early 2020 due to COVID-19 related global lockdowns.

Health

  • Rose across all household types due to an increase in the cost of medical and hospital services and pharmaceutical products as a result of the cyclical reduction in the proportion of consumers who qualify for subsidies under the Medicare safety net and Pharmaceutical Benefits Scheme (PBS). The safety net thresholds for both the PBS and Medicare are reset on 1 January each year. 

Food and non-alcoholic beverages

  • Rose across all household types due to an increase in beef and veal prices as favourable weather conditions saw farmers re-building herds after prolonged drought conditions, reducing meat supply. Meals out and takeaway prices rose as the continued easing of lock-down restrictions saw more consumers dining at restaurants, allowing restaurants to pass through input cost increases.
  • Partially offsetting the rise was price falls for fruit and other cereal products due to favourable growing conditions leading to increased supply. 

Housing

  • Fell for three out of the five household types due to a decrease in electricity prices. An annual review of Victorian electricity prices drove a fall in Melbourne, while the continuation of the $600 household electricity credit in Western Australia drove a fall in Perth. 

Insurance and financial services

  • Fell across all household types due to a decrease in mortgage interest charges as a result of recent reductions in fixed interest rates. 

Population sub-groups

At the All groups level, differences across the population sub-groups quarterly movements are largely explained by the weight of automotive fuel, pharmaceutical products, electricity and mortgage interest charges.

Pensioner and beneficiary households (+0.7%)

  • Living costs for pensioner and beneficiary households recorded a larger rise due their higher expenditure on health related goods and services.
  • Over the past twelve months the Pensioner and Beneficiary Living Cost Index (PBLCI) rose 0.6% due to price rises in food and non-alcoholic beverages (+0.6%) and alcohol and tobacco (+10.8%). Falls in electricity (-15.8%) and mortgage interest charges (-15.2%) partially offset the rise. Mortgage interest charges fell due to reductions in fixed interest rates. 

Employee households (+0.5%)

  • Living costs for employee households recorded the smallest rise of all household types due to a higher expenditure on mortgage interest charges which fell 2.3% this quarter. Mortgage interest charges fell due to recent reductions in fixed interest rates.
  • Over the past twelve months the Living Cost Index for employee households was flat. Living costs for employee households was the only population sub-group to not increase annually due to a fall of 15.1% in mortgage interest charges.

Age pensioner households (+0.9%)

  • Living costs for age pensioner households recorded the largest rise of all household types due to the highest expenditure for automotive fuel and pharmaceutical products.
  • Over the past twelve months the Living Cost Index for age pensioner households rose 0.5% due to price rises in food and non-alcoholic beverages (+0.6%) and alcohol and tobacco (+8.2%). A fall in electricity prices (-16.4%) partially offset the rise. 

Other government transfer recipient households (+0.6%)

  • Living costs for other government transfer recipient households recorded the same rise as the CPI. The main contributors were automotive fuel and pharmaceutical products. 
  • Over the past twelve months the Living Cost for other government transfer recipient households rose 0.7%.

Self–funded retiree households (+0.7%)

  • Living costs for self–funded retiree households recorded a larger rise than the CPI due to a higher expenditure for automotive fuel and pharmaceutical products.
  • Over the past twelve months the Living Cost Index for self–funded retiree households rose 1.3%.

Data downloads

Table 1. All groups, index numbers and percentage changes, by household type

Data files
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Table 2. Commodity groups, index numbers, percentage changes and points contributions, by household type

Data files
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Table 3. Gross insurance, mortgage interest and consumer credit, index numbers and percentage changes, by household type

Data files
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Use of price indexes in contracts

Price indexes published by the Australian Bureau of Statistics (ABS) provide summary measures of the movements in various categories of prices over time. They are published primarily for use in Government economic analysis. Price indexes are also often used in contracts by businesses and government to adjust payments and/or charges to take account of changes in categories of prices (Indexation Clauses).

Use of Price Indexes in Contracts that sets out a range of issues that should be taken into account by parties considering including an Indexation Clause in a contract using an ABS published price index.

Frequently asked questions

The Frequently Asked Questions page that has answers to a number of common questions to do with price indexes and the Consumer Price Index, in particular.

Previous catalogue number

This release previously used catalogue number 6467.0.

Methodology

Selected Living Cost Indexes, Australia methodology, March 2021