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Cost of living. . .

Cost of living

By Emma O'Neill.
Published on the VCOSS Voice on 4 May 2017.
http://vcoss.org.au/blog/cost-of-living-2/

Victorian Budget 2017/18 VCOSS analysis web header

Cost of living

The 2017 Victorian Budget includes several welcome measures to help low-income households with essential living costs.

We particularly support funding for subsidised energy efficiency upgrades for people on low incomes. People facing poverty and disadvantage are more likely to live in poor-quality housing that is expensive to keep warm or cool. Energy efficiency upgrades help cut the cost of energy bills, promote good health, and help mitigate climate change effects. Upgrade programs should be expanded in future, including across all social housing.

VCOSS also welcomes funding for an independent energy broker trial, which can help people find a better energy deal in a confusing market. The trial will assist culturally and linguistically diverse (CALD) Victorians and people facing energy hardship. If the pilot is successful, VCOSS would like all Victorians to have access to an independent energy broker, which should help to drive price competition among energy retailers.

Another welcome measure is investment in financial counselling for family violence victims. This will fund 10 specialist financial counsellors across Victoria, as well as family violence training and an online resource for financial counsellors. Further budget analysis of family violence measures can be found here.

Key budget initiatives

Budget17 icon2Subsidised energy efficiency upgrades for low-income households

This initiative will help low income households reduce energy bills by assisting with the cost of energy efficiency upgrades and expanding access to the Victorian Energy Efficiency Target (VEET) scheme, which provides discounted energy saving products, like insulation and lighting.
Cost: $26.2m in 2017-18 ($88.8m over four years) (NB: this package is not entirely allocated to energy efficiency initiatives and includes renewable energy and large-scale storage initiatives.)

Budget17 icon2Getting a better deal through the Energy Compare website

Around 50 per cent of people have not switched energy companies in the past five years. The Energy Compare website will be promoted and upgraded, making it easier for customers to search for better value energy deals.
Cost: $6.1m in 2017-18 ($10.7m over two years)

Budget17 icon2Independent energy broker pilot

Engagement with the energy market can be very difficult for vulnerable customers, due to a lack of internet access, language barriers and major financial, health and housing stresses. This initiative will help people facing hardship and CALD Victorians find a better energy deal.
Cost: funded within general departmental budget allocation

Budget17 icon2Family violence financial counselling

This investment will help family violence victims achieve financial recovery and independence, including victims who have experienced financial abuse.
Cost: $1.5m in 2017-18 ($6m over four years)

Budget17 icon2International student travel discount

This will reduce public transport costs for eligible international students, helping to ease the cost of living and allowing students to better explore Victoria, to the benefit of regional areas.
Cost: $2.7m in 2017-18 ($3.7m over two years)

VCOSS future policy directions

Increase and index the Utility Relief Grant cap
The Victorian Government can further tackle energy hardship by increasing the Utility Relief Grant (URG) cap, which has remained capped at $500 since 2010, despite energy prices increasing by around 12 per cent each year. The URG cap should be indexed to keep up with energy and water price changes.

Help asylum seekers access water and energy affordably
VCOSS was disappointed to see asylum seekers still do not have access to energy and water concessions. Asylum seekers living in the community face extreme financial hardship due to restricted work rights and very low income support payments. Energy and water concessions would help reduce this hardship.

Increase people’s access to financial counselling
While investment in specialist family violence services is an excellent start, all financial counselling services need additional resources. There is significant and growing demand for financial counselling due to rising energy costs, housing costs and private debt levels. The Victorian government can help people navigate their way out of financial stress by increasing funding for all financial counselling services.

Increase people’s access to No Interest Loan Schemes (NILS)
The Victorian Government has made some welcome investments in NILS programs over recent months, including in the Latrobe Valley, but more extensive operational funding is needed to allow NILS loans to reach more people. NILS loans reduce financial stress, allow people to pay for energy efficiency upgrades and education costs, and divert people away from predatory credit providers and goods rental schemes. For every dollar invested in a NILS loan, $1.59 worth of social and economic value is created.

Sector view

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