Family Shopping Prices Rocket Up – Before GST Rise

Family First NZ says that the price of budget shopping for a low income family has increased well above the consumer price index over the past two years – even before the GST increase has happened.

A weekly shopping basket for a family with a budget of between $150 and $240 per week was recorded at two different supermarkets in Auckland in 2008, 2009 and now in 2010.

Over the past two years, shopping on a strict budget has still increased between 9% and 11%, and shopping with the ability to choose dearer options has increased by up to 16% at one retail chain. However, Statistics NZ says that the CPI has increased since 2008 by less than 5%.

“While the wages and salaries of many families have been almost frozen over the past 24 months due to the recession, essential and basic groceries for families have potentially increased by up to 6% over the past year and 16% over the past 24 months,” says Bob McCoskrie, National Director of Family First NZ.

“The shopping basket only included basic items necessary for a family, with very few ‘treat’ foods. It doesn’t include any restaurant eating or takeaways but is simply a ‘survival’ budget for a busy family.”

“According to Statistics NZ, food prices increased 1.8% from June 2009 to June 2010, and just over 3% in the year before, but this fails to reflect the realities of what low income families are facing,” says Mr McCoskrie. “This is not discretionary spending. It’s the basic spending that a family would need to do just to survive.”

“It comes as no surprise that families are struggling financially and that discretionary spending such as family trips, sports, and school expenses are being reduced. Desperate parents will be turning to food banks, looking to work longer hours, get extra jobs, and may even be turning to loan sharks. This will be increasing the stress of many families.”

“Rate increases in GST coupled with increases as a result of the Emissions Trading Scheme suggest that families are in for a continued rough ride,” says Mr McCoskrie.

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