Australia begins 2023 with an annual inflation rate of 7.3 per cent, a 30-year high, driving up energy costs, road tolls, passport fees, and other bills from January 1, but it’s not all bad news.
Cheaper medicines, a boost in welfare payments and savings on child care are among the host of changes in the new year.
With 2022 bringing the worst cost-of-living crisis in a generation and steep interest rate hikes squeezing millions of budgets, it was a challenging year for many Australian families, and unfortunately, 2023 brings little reprieve.
With inflation driving up the cost of living, what does that mean exactly for Wellington Shire families?
AGL gas customers in Victoria will see a price increase on standing offers beginning January 1, while customers on variable rate market contracts will see a price increase beginning February 1.
Gas prices for Energy Australia residential and business consumers on a standing offer tariff will see an average 28 per cent hike from January 1, while gas rates will climb by 22.1 per cent for residential Origin gas users and 24.3 per cent for small businesses.
Victorians will also pay extra for tolls this year, with a 12 cent rise for cars travelling the whole length of Melbourne’s CityLink taking effect on January 1, on top of increases for trips across Bolte Bridge, Tulla and CityLink daily passes.
The Department of Foreign Affairs and Trade’s passport fees have increased again, with a 10-year passport for people 16 and over now $8 dearer, costing $325, and an extra $9 is added to the price tag for a five-year passport.
Emergency and replacement passports and priority processing fees have also increased by more than $10.
The cost of a stamp, the basic postage rate, also increased from $1.10 to $1.20 on January 3.
Interest rates have risen for the eighth month in a row, pushing thousands of Australian homeowners to strain their household budgets to the breaking point, already stressed by sky-high living costs.
Treasurer Jim Chalmers said the Reserve Bank’s run of successive rate hikes in 2022 would take months to impact the Australian economy fully, estimating the full effects in mid-2023.
“That’s when the interest rate hikes are expected to hit the hardest,” Dr Chalmers said.
Thankfully Australia’s best economic pundits have good news with Gareth Aird, Head of Australian Economics at CommBank, speculating just one more Reserve Bank of Australia (RBA) rate hike in 2023.
“We think we are near the end of the RBA’s tightening cycle,” he said.
“Expect one further rate hike in Q1, 2023 that will take the cash rate to 3.35 per cent,” Mr Aird said.
“From there, we have the RBA on hold as much slower growth in demand is expected to see inflation come down in 2023.”
The good news doesn’t end there.
Youth Allowance and Austudy Centrelink payments will be indexed, increasing by little more than six per cent as of January 2023.
That corresponds to an extra $19 per fortnight for Youth Allowance, between $32.40 and $41.40 for Austudy, and between $27.40 and $40.70 for individuals under 21 on Disability Support Pension.
Totally and Permanently Incapacitated (TPI) Veterans will get an additional $1000 a year, an increase of $38.46 per fortnight, although Australian Council of Social Service CEO Cassandra Goldie said it’s not enough.
“Income support payments were woefully inadequate before the prices of food, rent, medicines, energy, and other essentials skyrocketed, and they will still be totally insufficient after indexation,” Ms Goldie said.
“There are more than three million people living in poverty in Australia, and this Christmas, one in five of us were struggling to afford food.
“The federal government must take action to change this by lifting income support payments to at least $73 a day in the May budget.”
The maximum cost of medicine on the Pharmaceutical Benefits Scheme (PBS) is $30, down from $42.50 as of January 1 however, subsidised mental health sessions will be cut in half from 20 to 10 sessions per year.
The federal and state governments will hand out 180,000 fee-free TAFE, vocational education and training places in 2023 for study areas identified as a ‘national priority’, including care, hospitality and tourism, construction, agriculture, sovereign capability, technology and digital.
As of this year, all Victorians are entitled to two years of free Kindergarten programs as part of the $9-billion Early Childhood Education and its Care reform program.
A 15-hour per week program will be available to four-year-old children, and a five-to-15-hour program will be available to three-year-old children per week.
