Page 3675 - Week 09 - Tuesday, 23 August 2011
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with high usage of credit cards, we have become a nation of savers. It is quite clear from some of the charts that have been put out by the bureau of stats and the Reserve Bank that we see an enormous increase in the savings that people are being forced to put away to squirrel against the future. Of course, this curtails retail spending, but it builds up our savings to provide a buffer against difficult times.
It is also important to note the slowdown in retail spending in the ACT. As people have less to spend, they are cutting out on the luxuries. For the June quarter for 2011 in the ACT, the retail sales in trend terms fell by 0.6 of one per cent, more than in any other jurisdiction, remembering that that is at a time when we have perhaps the highest level of wages of any jurisdiction in the country. Perhaps what is more worrying is that, in real terms, retail sales fell by 2.6 per cent. This was far and away the largest reduction of all jurisdictions, and, again, highlights the pressure that households find themselves under. This was the largest real fall since retail sales fell by two per cent in Queensland in September 2009. One could speculate that it is difficult to be clear as to why this fall took place, but you would be on reasonably safe ground to strongly suspect that cost of living pressures and the ways in which families are responding to these pressures are a major reason.
A fourth factor may be that families have had expectations that are simply too high. The Chief Minister callously makes the comment that one should cut the Foxtel, and that is quite illuminating. Families may still be spending on cars, and it is interesting that car sales are still travelling very well, but, for example, many are choosing cheaper models. Likewise, for spending on food, groceries, transport and so on, people are lowering their expectations. Indeed, I am told by those in the hospitality trade that, where a bottle of wine or two would have been ordered at a meal, the house red will now suffice. Many who normally as regular customers may have had three courses are now limiting themselves to two.
We are seeing families lowering their expectations. We are seeing families lowering what they spend, all at a time when we see an ACT Labor government with their hand in their pockets continuously taking more and more from Canberra families, and, as we saw at the end of 30 June this year, an extra $192 million above the expectation.
It is important to go to that result for last year. A five per cent increase is a significant increase in the take—$192 million. Clearly, this government has increased the cost of living pressure on Canberra families because, at the end of the day, it is those families that pay those charges, whether they pay it directly out of their pockets or whether they pay it through the way that they spend or whether they pay it through the businesses that they operate and that they own and that they support.
It is because of these developments that the estimates committee in its report which was tabled in June recommended that the government undertake an analysis of cost of living in the ACT, including analysis of the impact of government fees, rates and charges on Canberra families since self-government. The recommendation is on page 33, and it is recommendation 35:
The Committee recommends that the ACT Treasury Directorate conduct a comprehensive cost of living analysis of Government taxes, fees and rates on Canberra families since self government.
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