The Senate Cost of Living Committee today heard evidence from witnesses that Australians are facing higher prices and higher mortgages, with only 8 per cent of economists positive about the economy this year.
The Committee heard that while many are struggling to address the new higher interest rates for mortgages, many more are about to see their mortgage pressures increase as their lower fixed rates come to an end.
The Reserve Bank of Australia gave evidence that over 800,000 mortgages will come off fixed rate mortgages in 2023, piling pressure on Australians. Consumer data company Finder stated that RBA cash rate rises this cycle have increased a typical Australian variable mortgage holders’ repayments by around $10,000 per year.
Woolworths gave evidence that Australians in their stores are changing their behaviour to keep within tighter budgets.
Charities that rely on Woolworth’s food donations have already told them that they will need increased donations into 2024, with no sign of the pressure easing on the increasing reliance on charities to put food on the table.
This will happen at the same time as power prices continue to soar. The Committee heard that energy companies are pausing or withdrawing millions of dollars of investments in new supply, which would keep power prices low.
Liquid fuel company Ampol gave evidence that they have delayed investment decisions worth hundreds of millions of dollars due to Labor creating uncertainty in the market.
Chair of the Committee Senator Jane Hume said the evidence of today’s hearings further illuminated the cost of living pressures that Australians were feeling at the bowser, at the supermarket checkout, and in their mortgage repayments.
“This Committee is working to come up with practical and responsible solutions to this crisis because Labor does not have a plan to tackle inflation. We are having to step up because Anthony Albanese won’t,” Senator Hume said.
Senator Dean Smith said it was distressing how significantly the number of Australians relying on charities was growing.
“One third of those walking through the doors of the Salvation Army say cost of living is why they need help. Charities are also facing their own operational pressures – they aren’t immune from increased overheads – and asked today if they have been forced to turn people away the answer was a unanimous yes,” Senator Smith said.
Senator Matt Canavan said the Committee was concerned that energy investment is being put under the pump by a lack of certainty and this could lead to higher prices and fewer jobs.
“We know from the evidence we heard today that Labor is failing Australians every day they scare away investment in our energy and resources sector. Less gas, less petrol only leads one way – higher prices,” Senator Canavan said.