Breaking point: financial stress of ongoing cost-of-living crisis hitting low-income Canberrans hardest

ACTCOSS’s latest ACT Cost of Living Report reveals persistently high inflation and high interest rates are exacting a devastating toll on low-income households and adding to demand for community sector services across the ACT. 

ACTCOSS CEO, Dr Devin Bowles said: “The ongoing cost-of-living crisis has extended the reach of financial stress to more and more Canberra households over the past year.  

“It has also deepened the disadvantage of those Canberrans who were already struggling to make ends meet.  

“While some households have needed to draw down on savings, reduce discretionary spending, or switch to cheaper brands of essentials, those living on the lowest incomes have had to make much harder choices, between turning the heating off or missing rental payments and risking eviction. 

“While the rate of Canberra’s inflation eased in 2023 compared to the previous year, it remained high at 3.7%. For many households it has built on and ratcheted up the cumulative pressure from successive years of cost-of-living stress. 

“There are thousands of Canberrans who saved for a rainy day, only to have it rain for years. We are witnessing a once-in-a-generation economic shift that will grow the wealth gap and make Canberra a less fair place without decisive action.” 

The 2024 ACT Cost of Living Report reveals that over the past five years Canberrans have seen the prices of many essential goods and services rise above the rate of inflation. This includes education (+26.0%), housing (+22.8%), medical and hospital services (+22.4%), transport (+22.3%), childcare (+21.4%), food (+20.0%), and gas (+20.0%).  

This has had a disproportionate impact on low-income households that spend more of their income on non-discretionary items. The combination of goods and services – including education and childcare – has resulted in a significant increase in the cost of raising children in Canberra, which has disproportionately affected families. 

Dr Bowles said: “A flow-on effect of increased and persistent cost-of-living pressures has been an increase in demand for supports and services provided by our already overstretched and underfunded community sector here in the ACT.  

“Case studies from community organisations presented in this year’s report demonstrate the critical role that our sector plays in supporting Canberrans through tough times. They show that financial stress is often a contributor to or an outcome of other challenges in people’s lives, such as domestic and family violence.  

“The most valuable asset of the ACT is its human capital – and as a community we are allowing this to be squandered during the cost-of-living crisis. Broadening and deepening poverty is locking up our collective human potential. 

“Nowhere is this trend clearer than among our children. Financial stress is not only forcing some families to compromise on essentials, but has knock-on effects for the wellbeing of children and young people.  

“Across the country, children experiencing poverty have poorer academic outcomes than other students. Sadly, the ACT is behind only the Northern Territory in our inability to effectively enable students from families experiencing poverty to access the full benefits of education.  

“The principle that poverty inhibits people from realising their full potential, for themselves as well as their communities and the broader economy, applies to people of all ages.”  

Dr Bowles concluded: “As candidates and voters prepare for the ACT Election in October and a federal election by May next year, ACTCOSS is keen to draw their attention to this report which calls for a range of government actions to alleviate cost of living for low-income households and to ensure we have a thriving and sustainable community sector that is accessible by all Canberrans”.

Quotes from ACT Community Sector Organisations 

Carmel Franklin, CEO, Care Inc. said: 

“Over the past 12 months Care has seen an increase in demand across all programs – financial counselling, community loans and consumer law. Housing and utility stress are common themes with people turning to Buy Now Pay Later and other high-cost products to cover essential everyday household costs. Financial stress is on the rise and is impacting a broader cohort, including people who have not previously required assistance from a support service.” 

Brooke McKail, Director Policy and Engagement, Domestic Violence Crisis Service (DVCS) said:  

“We need to make sure that women and children escaping family violence have the financial security to leave, knowing they will be able to secure a safe place to live, pay the bills and put food on the table. But right now, low rates of single parent and social security payments and the high prices of groceries, education, transport and especially housing are leaving many women in the ACT facing the impossible choice of staying in a violent relationship or leaving and facing poverty. 

“Demand for DVCS’ brokerage funding and emergency accommodation to keep people safe has also increased significantly in recent years. People experiencing family violence are staying longer in emergency hotel accommodation because they can’t afford rental properties anywhere in Canberra and are seeking help to buy petrol or phone credit that means they can leave or seek help when it isn’t safe at home. Safe, affordable housing and adequate income support would help make Canberra a safer place where everyone can live free from domestic and family violence.” 

Rebecca Zappelli, Executive Director, Families ACT said:

“Families ACT recognises the significant impact that increased cost of living continues to have on Canberra’s children, young people, and families. The 2024 ACT Cost of Living Report highlights the urgent need to address these costs to ensure economic stability and support ACT families. Families ACT supports efforts focused on delivering policies and interventions that alleviate financial pressures and improve the quality of life for children, young people and families living in the ACT.” 

Miranda Phillips, Social Services Manager, Roundabout Canberra said:

“At Roundabout Canberra we are seeing a 32% increase in number of children requiring material support as the economic challenges in the ACT region continue in 2024.  We have heard many stories of parents waiting until they were on the brink, making choices between paying rent that week or purchasing items for their newborn, or nappies and clothing for their children. We continued to see families where one or both parents were working, yet it wasn’t enough to cover essentials and are having to access support for the first time.” 

Lucy Hohnen, CEO, St Vincent de Paul Society Canberra/Goulburn said:

“As Australia’s cost of living and housing crises continue, more individuals and families in the ACT are experiencing acute poverty. The St Vincent de Paul Society Canberra/Goulburn is supporting an increasing number of people experiencing hardship and homelessness. We provide direct financial assistance, food, clothing, and other support. In the last 12 months, a third of the calls to our emergency relief helpline were from people seeking assistance for the first time, and the number one item they come to us for is food.  These are people who hold mortgages or are private renters, and in many cases dual-income households but who simply cannot afford to meet their basic needs. We are now helping a much broader demographic in our community who are experiencing poverty.” 

Jean Giese, CEO, Volunteering ACT said:

“The rising cost of living continues to have a significant impact on individuals and households across Canberra. Through Volunteering ACT’s work supporting people to access food relief and community services, we have noticed an increase in requests for these services. We have also heard from food relief providers in Canberra that demands on their services have increased by between 20 and 70%. There has been a significant trend of double-income families accessing food relief for the first time. The advocacy work of ACTCOSS is vital at this time, this report provides context and insight into the impacts of the cost-of-living crisis.” 

Hannah Watts, CEO, Youth Coalition of the ACT said:

“The escalating cost of living in the ACT is putting significant pressure on young people, making it increasingly difficult for them to secure housing, pursue education, find stable employment and build a future. This has significant impacts on their social, emotional and physical wellbeing. It’s crucial that we address these challenges now, to ensure young people have the opportunities they deserve.” 

ACTCOSS advocates for social justice in the ACT and represents not-for-profit community organisations.
Follow us @ACTCOSS on Twitter, Facebook and Instagram. 

For more information or comment, please contact:
Dr Devin Bowles, CEO, ACTCOSS, on 0423 435 080
Carmel Franklin, CEO, Care Inc., on (02) 6257 1788
Phillip Jones, Director Marketing, Fundraising & Communication, St Vincent de Paul Society Canberra/Goulburn, on 0414 788 681
Brooke McKail, Director Policy and Engagement, DVCS, on 0438 100 175
Miranda Phillips, Social Services Manager, Roundabout Canberra, on 0481 403 994
Hannah Watts, CEO, Youth Coalition of the ACT, on (02) 6247 3540
Rebecca Zappelli, Executive Director, Families ACT, on 0402 718 579  

Authorised by Dr Devin Bowles on behalf of the
ACT Council of Social Service Inc (ACTCOSS)