Superannuitants feel effects of rates rises
Superannuitants feel effects of rates rises – Media release
26 October 2018
Superannuitants faced the highest inflation in the September 2018 quarter (up 1.2 percent), largely driven by a 5.6 percent rise in local authority rates, Stats NZ said today.
Of the different household groups measured by Stats NZ, superannuitants were hit hardest by rates rises, while beneficiaries were affected least.
“As a proportion of their expenditure, superannuitants spend four times as much on local authority rates as beneficiaries,” consumer prices manager Geraldine Duoba said. “Beneficiary households tend to live in rented homes, so are less likely to be affected by rates increases directly.”
Along with local authority rates, price rises for vegetables (up 11 percent), petrol (up 5.0 percent), and dwelling insurance (up 4.4 percent) were the main contributors to inflation for superannuitants.
The highest-spending households saw the lowest inflation this quarter, up 0.7 percent. They were affected by price rises for petrol, vegetables, and local authority rates. However, price falls for mortgage interest payments, fruit, and telecommunication equipment helped keep inflation low for these households.
Petrol pushes annual inflation up for all households
The biggest contributor to annual inflation for all households in the year to September 2018 was higher petrol prices. The only exception was beneficiaries, who were more affected by rent increases.
“Middle-spending New Zealanders were hit hardest by rising petrol prices, while the higher-spending households and superannuitants weren’t as affected,” Ms Duoba said.
Vegetables showed an annual decrease as they returned to more typical price levels after the poor weather in 2017. This helped keep inflation low for all households, as did the decrease in tertiary education resulting from the Government’s fee-free first-year policy. The latter policy was reflected most in the highest-spending households, who saw the lowest annual inflation (up 1.9 percent).