High cost of living in the land Down Under sends Aussies offshore for life's necessities


Shoppers walk past a retail store window display in central Sydney on November 29, 2011.


Greg Wood

A new report has confirmed what Australian consumers have suspected for some time now: it's more expensive to live Down Under than just about anywhere on the planet, Europe and America included.

According to a report by the Centre for Independent Studies (CIS), groceries are several times more expensive Down Under than in Europe, for example;  while cars cost twice here as they do elsewhere in the world.

And housing is less affordable than some of the world's biggest cities, .

The report, titled "Price Drivers: Five Case Studies in How Government is Making Australia Unaffordable," blames government regulation for having made Australia one of the most expensive countries to shop in.

According to study co-author, Oliver Marc Hartwich, ordinary Australians should be outraged by the high prices they're paying to live in the "lucky country."

His report states that:

"Australia has become one of the most expensive countries in the world. Our cities’ consumer goods, retail space, and houses are now much less affordable than in the international cities of London, New York and Singapore...

"In the past years of the global financial crisis, Australia has been one of the best performing economies in the developed world. Thanks to cost of living pressures, many Australians do not believe they benefited from these relatively benign economic circumstances."

To solve the problem, Hartwich and assistant Rebecca Gill suggest that Australian governments at all levels ease restrictions such as import bans, taxes and planning regulations to reduce the cost of living.

It's worth noting here that the CIS is a pro-business, anti-regulation organization, which according to the arguably more independent Institute of Public affairs website favors "free enterprise economy and a free society under limited government where individuals can prosper and fully develop their talents."

They have also variously described as "conservative," "biased" and incidentally accused by the investigative website Crikey.com as having been "at the forefront over the years in backing tough measures to break the stranglehold of unions in the workplace."

A recent CIS report on the "rise in religious schools" was criticized as being biased in favour of non-public education — and the CIS itself accused of acting as a lobby group for private school education.

However, the CIS's report on Australia's soaring cost of living may go some way to explaining why Australian lawmakers this week awarded themselves pay rises of up to 30 percent.

(Down Under reported at the time: Australian politicians strike it rich, with Julia Gillard now paid more than Obama)

In light of the report, they've also reportedly defended their efforts to keep costs down for ordinary Aussies, telling the Murdoch press that "tariffs had been progressively reduced over three decades to promote free trade and lower consumer goods prices, and that a strong biosecurity and quarantine system was needed for imported-food risks." As well, they say, "personal tax cuts, higher pensions and other policies had eased cost pressures."

However, it seems small consolation when you look at the CIS report's examination of price data for food, books, cars, real estate and some retail goods. For example:

  • at $1,543 per ton, Australian apple prices in 2008 are double and even triple than in France ($677), Germany ($793), United States ($498), South Africa (US$438), and the United Kingdom ($1,109). ("New Zealand apples cost a mere $562 per ton.")
  • the seventh "Harry Potter" paperback costs $21.95 in Australia compared to $6.09 in Canada. Similarly, the third book of Stieg Larsson's Millennium trilogy ("Girl with the Dragon Tattoo" etc.) costs $6.55 in Britain compared to $24.95 here.
  • the Mercedes C-Class sedan is more expensive in Australia than in other countries — $70,564 compared with just under $42,000 in Germany and $26,500 to $41,770 in the US.
  • Sydney is the most expensive of 19 cities worldwide in which to park your car.

The report addresses the cost of housing in Australia, with houses that once cost three times the median household income now up to nine times that in some capital cities.

While they can't do much about the rip-off that is a roof over their heads and food in their fridges, Australians — also among the world's earliest adopters of technology — have turned to the internet to find affordable consumer goods such as books, CDs, DVDs and the like.

How much time that buys the politicians to produce a solution is anyone's guess.

Meanwhile, a visit to the beach is free....  for now.