It’s not uncommon to hear that the cost of living in Australia – and Sydney in particular – is among the highest in the world. And in exploiting our fear of hip-pocket pain, politicians and the media have fuelled our sense that keeping up with day-to-day expenses is getting harder and harder.

Yet for many of us, increases in our incomes have counterbalanced increases in the cost of living. And having to cover the cost of additional ‘essentials’, or taking care of an unexpected expense can be dealt with by changing our spending patterns: we eat out less, don’t buy that new outfit or forgo an expensive holiday. But for households who spend most – or even all – of their household budget on essential items, making such adjustments is not easy. For these households, cost of living pressures can mean difficult choices such as whether food, a school excursion or a visit to the doctor is more important.

This report, the first in an ongoing biannual series - focuses on those most in need. It draws on data collected by the Australian Bureau of Statistics (ABS) to assess how living costs have changed over the last ten years, and how these changes impact people experiencing poverty and disadvantage. In particular, it looks at cost of living changes across six key categories of ‘essential’ expenditure: Housing; Food; Transport; Health; Utilities and Education.

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