Annual Inflation of 4.9% shows that those with the lowest incomes will need more help if they are not to fall further
behind, says CTU Economist and Director of Policy Craig Renney.
“Today’s data from Statistics NZ demonstrates that the cost of living is rising faster than wage increases for most New
Zealanders. Employers and the Government will have to take steps to make sure that the lowest paid workers are protected
from these cost of living increases.”
CTU analysis of this data shows that the inflation has been concentrated in those areas which are the most difficult to
escape for households. Housing and household utilities contributed the most to the overall annual inflation figures,
rising by 6%. This was followed by transport, with prices rising 13% driven by higher fuel prices. Food was the third
fastest rising group, rising 3.1%.
Craig Renney said “These are items that all New Zealanders have to pay, meaning that inflation will be hitting those
with the least ability to pay the hardest.”
“These figures have not been driven by increases in wages. These figures have been driven by international factors such
as the price of energy, and domestic factors such as the prices of rental properties and rates. We should also remember
that last week's Crown Accounts corporate taxation rose 17.4%. Many companies across New Zealand appear to be doing
well.“
“These figures also demonstrate the need for continued increases in minimum wage that genuinely reflect the cost of
living for low-income New Zealanders. They also demonstrate the need for Fair Pay Agreements that would protect workers
from cost of living increases such as these. Many New Zealanders are facing a higher cost of living regardless of their
choices. What is a choice is how we respond to this challenge.”