Nearly 95% of Australian families have had to cut their spending on essentials such as food and heating over winter, as the cost of living skyrockets.

A new survey of 1000 households across Australia, conducted by Australian Parents for Climate Action, found that in order to manage costs, many families have cut back on basics like food and travel and almost 10% said they were accumulating debt to manage rising energy bills. 

Anxiety and stress was also on the rise due to additional financial pressures, and lower income families were more likely to have made significant changes to manage rising living costs, particularly reducing their use of electricity, heating and petrol, as well as skipping bills or paying them late.

The survey also found that the vast majority of families (95%) – renters and homeowners – wanted greater government investment and support in the form of rebates to make energy efficient solutions like solar and electric vehicles more accessible.

Australian Parents for Climate Action CEO Nic Seton said: “Households across Australia are experiencing a cost of living crisis, with families hit by increasing prices for food, electricity, gas, housing and petrol.

“From our survey, we heard that many families are experiencing anxiety and stress as they try to make ends meet, with many making really difficult decisions about how to balance their budgets and provide for their kids.

“What we really need to see is a long-term move towards renewable energy in the grid. At the same time we need to support households now by making it easier for them to access affordable and efficient energy, through upgrading appliances and making sure that they can switch over to electric transport in an affordable way as well.”

Key findings of the report included:

• 44% of families had reduced spending on food

• 41% of families had reduced their use of heaters

• Victorian families are experiencing tougher cost of living pressures as a result of their legacy gas network

• 40% of families were planning to spend less on holidays

• 35% of families had reduced their electricity use at home, which was more likely for Queensland families (44.3%) where electricity takes a greater proportion of energy bills.

ENDS

For more information or to arrange interviews, contact Emily Watkins on 0420 622 408 or at [email protected].

Full report available here.

Interviews available:

Nic Seton, Australian Parents for Climate Action CEO

Tim Buckley, Climate Energy Finance director and energy analyst

Merrily Hunter, MAC Energy Efficiency Group CEO

Case studies in Sydney, Adelaide, Sunshine Coast, Ballarat, St George (Qld)

Note to editors:

This survey was conducted online in July and August 2022, asking respondents about their energy use, cost of living expenses and spending over the past three months and some basic demographic information. The majority of respondents were not previously known to Australian Parents for Climate Action.

Additional expert comments:

Tim Buckley, Climate Energy Finance director and energy analyst:

“The average Australian family is currently being smashed by multiple, concurrent shocks to the cost of living. There is a commonality to these concurrent shocks – the hyperinflation in fossil fuel commodity prices (oil for cars, gas for energy, and gas and coal for electricity). We have seen oil prices double and treble, while gas and coal prices have risen five to tenfold. While the domestic Australian retail energy market has a regulatory lag and as such has not been hit with the full cost, as yet, pressures are building, and the ACCC, AEMO and AER have all warned 2023 looks worse than 2022.

“Worse for households, hyper-inflation of fossil fuel costs have caused a sustained surge in general inflation, which has the direct implication of rising interest rates, raising the cost of mortgage servicing at the same time as reducing the capital value of houses. For the vast majority, financial distress is elevated, and will rise further.

“It is critically important the federal government intervene to alleviate the unprecedented, combined fiscal, energy and climate crisis. The unprecedented nature of these crises requires a drastic response.

“We need a coordinated government approach that includes investment in reliable renewable energy sources. The CSIRO has repeatedly highlighted the lowest cost source of new electricity generation is solar and wind, while Dr Saul Griffith has well documented the savings of electrifying everything at the household level. The faster we move, the sooner households will see some of this energy price pain ease.”

Merrily Hunter, MAC Energy Efficiency Group founder and CEO:

“Household budgets are already strapped, and while we have strong employment levels the combined pressure of rising mortgages, rising rents, rising fuel costs, insurance and now hikes in energy prices are pushing many people into debt just to cover the essentials, let alone have any discretionary spending.  

“Enabling households to make an impact on their basic costs of living as well as their environmental footprint through the upgrade of appliances is a no brainer and more broadly a critical step we need to take to adapt our housing stock to the new climate and energy market.  

“I have worked in energy efficiency for more than a decade, and each year have had a focus on delivering a portion of energy saving measures for residential households experiencing financial hardship. The stories I have heard over the years are similar in tone, that the families are aware of the need to take action on energy efficiency, whether that related to environmental outcomes or direct financial savings, but they lack the knowledge or financial means to be able to take the next steps. Financial support by incentives, rebates, discounts and no interest loans, removes that barrier to uptake – the householder can then take action on upgrading appliances because they are now at cost parity with the cheaper (inefficient options) available on the market. This in turn creates immediate financial savings in running costs for the home and reduces emissions, but it also creates employment opportunities and puts money back into the economy.”