MEDIA RELEASE
13 AUGUST 2007

Rise in Food Prices Continues to Put Pressure on Families

The latest Food Price Index continues to put the pressure on families in their ongoing battle to meet their weekly bills and one-off major costs such as car repairs and children’s uniform costs.

“The latest Food Price Index reveals that food prices have increased by 3.4% in the last 12 months,” says Bob McCoskrie, National Director of Family First NZ.

“The Working for Families package seems to have been swallowed up in the increasing costs of rents (3%), gas (10.6%), electricity (6.9%), increasing house prices, rates, and interest rates, and now food prices. Cumulative inflation for the last 8 years has been over 22%. Low and middle income families are being the hardest hit.”

Essential healthy foods such as fruit and vegetables, which are being encouraged to overcome the obesity epidemic, have increased by almost 7% in the last month (2.7% over the past 12 months). Grocery food has increased 1.8% over the past 12 months, chocolate by 8.1%, and fresh milk has increased by almost 10% in just the last month. Unfortunately for kids, the price of broccoli has decreased substantially!

“Families on benefits have also been the most affected because of not qualifying for the Working for Families package. Low- and middle-income families cannot avoid these price increases because they are ‘essentials’ – not optional luxuries.”

“Despite the Government's operating surplus of $6.5 billion for the eight months ending February, (almost $1.5 billion ahead of forecasts), families in Auckland and Wellington are also facing an increase in petrol tax by 10c as a result of the last Budget.”

“When the family earns more income, they lose their entitlement to the level of the Working for Families payment. Yet when the government earns more income, they keep it,” says Mr McCoskrie.

Family First NZ supports tax breaks for families with children, including splitting income and marriage tax credits, exemptions on GST for essential food items, and lower tax rates for families in the lower to middle income tax bracket.

ENDS

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