Age pensioners and self-funded retirees experienced cost of living increases that were in line with other consumer groups, except worker households, which have risen dramatically.

That is according to the September quarter figures issued by the Australian Bureau of Statistics.

However, older Australians with a mortgage and high household energy use (without solar) are likely worse off because those costs are rising dramatically.

Living costs rose 1.8 per cent for pensioners and self-funded retirees. Worker household costs rose 2.6 per cent, primarily due to higher mortgage repayments.

This was the largest quarterly increase in employee households’ living costs since the September 2000 quarter, which followed the introduction of the GST.

All household types saw increases in their living costs equal to or higher than the Consumer Price Index (CPI) for the first time since the March 2018 quarter.

Head of price statistics at the Australian Bureau of Statistics (ABS), Michelle Marquardt, said the effect of price changes varies between household types because they spend differently but some cost increases were felt across all groups.

“Higher food and automotive fuel prices in the past 12 months contributed to higher living costs for all household types,” she said.

“Annually, food prices rose between 9 and 10 per cent across the household types, driven by fruit and vegetables, while fuel prices rose around 18 per cent.”

Furnishings and household equipment lifted the cost of living across all groups, as well as higher insurance and financial service costs, which increased 12.8 percentage points for employees over the three months to September and 8.3 percentage points for self-funded retirees.

Mortgage interest charges for worker households rose 24.2 per cent over the quarter, with banks passing on the Reserve Bank of Australia's recent cash rate rises to interest rates for both variable and new fixed-rate home loans. Mortgage interest charges make up a higher proportion of overall expenditure for employee households compared to other household types.

Annual increases in living costs this quarter were the largest seen across all household types since their series commenced (1999 for most household types and 2008 for the pensioner and beneficiary households).

Employee households also had a larger annual increase, 6.7 per cent, in living costs than the other household types, which increased between 6.3 and 6.5 per cent.

Worker households paid 25.3 per cent higher mortgage interest charges over the year, reflecting both higher interest rates and higher mortgage debt levels.  

Higher food and automotive fuel prices in the past 12 months contributed to higher living costs for all households.

Annually, food prices rose between 9 to 10 per cent across the household types, driven by fruit and vegetables, while fuel prices rose around 18 per cent.