AUSTRALIA - The Australian Bureau of Statistics has unveiled the Pensioner and Beneficiary Living Cost Index (PBLCI), providing a measure of price changes in living cost as they affect pensioners.
The ABS, which publishes the Consumer Price Index (CPI), said that the CPI is designed to measure price inflation for the household sector, and is not ideal for assessing the impact of price changes on the disposable incomes of pensioners.
As a result, the Government requested the ABS to create the PBLCI, which it will use as a new measure of price change in order to index base pension rates where it is higher than the CPI.
The release of the PBLCI comes after a recent report, led by chief executive of UK insurer Friends Provident Trevor Matthews, concluded that the Australian Government civilian and military superannuation scheme's pensions should continue to be indexed by the CPI. (Global Pensions; August 21, 2009)
The PBLCI index revealed a 0.1% increase in prices for the second quarter, showing a smaller increase than the Consumer Prices Index, which rose 0.5%. The ABS said that PBLCI households have a relatively higher proportion of expenditure on food items, that the wider CPI population.
The most significant rise price increases in the second quarter were for household contents and services, which increased by 2.2% and transportation, which rose 1.8%. Conversely, the largest price falls in this quarter were seen in the financial and insurance services sector, which decreased by 6.3% and food, which fell by 1.4%.
The index has been designed to show by how much, after tax, incomes need to change to allow age pensioners and households whose main source of income is government benefits, to buy the same quantity of consumer goods and services that they bought in a previous benchmark period.
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