Cost of living

The 2018 Victorian Budget includes some welcome measures to help relieve energy hardship.

The standout measure is the increase to the Utility Relief Grant, which will help people in acute financial crisis pay their energy and water bills. After a long period of stagnation, the Utility Relief Grant will increase from $500 to $650 to better reflect current energy costs. This practical and much-needed measure will help Victorians avoid disconnection and better manage essential living expenses.

Victorians on low incomes will also benefit from a $50 incentive payment to use the Victorian Energy Compare website and find a better power deal. Seventy per cent of people who use the website and switch energy companies save money. With winter coming, VCOSS strongly encourages people to search the website and switch to a cheaper deal—there’s the potential to save hundreds of dollars per year.

While these measures are welcome, the 2018 Victorian Budget did not fund other important initiatives to alleviate cost of living pressures, including increased funding for emergency relief and financial counselling services, and scaled-up energy efficiency upgrades for low-income earners. VCOSS looks forward to further commitments in the lead-up to the November state election.

 

Positive initiatives

  • Utility Relief Grant boost
    The Victorian Government will increase the Utility Relief Grant from $500 to $650. The grant is available to people facing temporary financial crisis (e.g., due to job loss or housing stress) and covers a maximum of six months’ energy or water use.
    Cost: $5m in 2018-19 ($21.8m/4 years)

 

  • Power Saving Bonus
    All Victorian households will receive a one-off $50 payment if they register on the Victorian Energy Compare website between 1 July and 31 December 2018. Energy Compare is an independent website that allows you to search for a cheaper energy deal.
    Cost: $47.8m in 2018-19

 

  • Greater funding for Victoria’s energy and water regulator
    The Essential Services Commission will receive increased funding to undertake additional regulatory work, including implementing energy market reforms and regulating non-licensed electricity providers such as caravan parks and ‘embedded networks’ in apartment buildings.
    Cost: $4.1m in 2018-19 ($10.4m/5 years)

 

  • Water efficiency programs
    The Victorian Government will continue funding the Community Rebate Program, which helps low-income and hardship customers access water efficiency measures to reduce their water use and costs.
    Cost: $1m in 2018-19 ($2m/2 years)

 

  • Discounts to regional student transport passes
    The price of regional student passes will drop. These passes provide unlimited travel on buses and V/Line train services within the chosen regional zone. Prices vary according to the regional zone in which a student travels.
    Cost: $0.5m in 2018-19 ($2m/4 years)

 

  • Public transport concessions for international students
    The Victorian Government will continue the International Undergraduate Student Education Pass program, which provides discounted annual public transport tickets to eligible international students.
    Cost: $5.5m in 2018-19

 

Future policy directions

  • Financial wellbeing package
    Victoria’s emergency relief and financial counselling services can’t keep up with demand. Cost of living pressures, such as unaffordable housing and energy costs, are causing a blow-out in household budgets. The Victorian Government can help families meet their essential needs, and prevent financial problems escalating, by funding a comprehensive financial wellbeing package, including development of a Victorian Financial Inclusion Action Plan, and investing in emergency relief, financial counselling, and No Interest Loan Schemes.

 

  • Energy efficiency upgrades for low-income earners
    The Victorian Government made some welcome, relatively small-scale investments in energy efficiency upgrades as part of the previous budget. It is now time for government to scale-up these initiatives across social and private rental housing. An energy efficiency program could include a mix of government-funded upgrades, subsidised upgrades and No Interest Loan Scheme financing.

 

  • Energy and water concessions for asylum seekers
    Victoria is home to a small but significant group of asylum seekers living in the community, who do not have access to energy and water concessions despite facing extreme financial hardship. By making concessions available to this group, the Victorian Government can help ease the burden on highly vulnerable families and better allow them to afford essential lighting, cooking and heating expenses.
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