Cost-of-living pressures are hitting Australians hard, but some groups are struggling more than others. New data from the Australian Bureau of Statistics (ABS) has shed light on just how uneven these increases are, revealing that those on government payments are facing the brunt of the hike. So, while everyone\u2019s feeling the pinch, some are getting squeezed a lot tighter.<\/p>\n\n\n\n
In 2025, the ABS<\/a> recorded annual cost increases ranging from 2.3% to 4.2%, depending on your household situation. The highest cost increases were seen by those who are relying on government payments, with costs climbing by at least 4%. A big chunk of this rise comes from higher energy bills, a sector that\u2019s been particularly tough for those on welfare, pensions, and other government assistance.<\/p>\n\n\n\n Meanwhile, employee households saw the smallest increase at just 2.3%. Why? Well, largely thanks to the falling mortgage interest charges, after the Reserve Bank of Australia (RBA) made multiple rate cuts last year.<\/p>\n\n\n\n Now, let\u2019s talk about the tough spot that government-payment households are in. The rise in electricity prices has hit these households the hardest, with many pensioners and welfare recipients feeling the squeeze the most. In fact, for these groups, the price of basic energy and even everyday goods has increased substantially, making it harder to make ends meet.<\/p>\n\n\n\n Interestingly, Ben Phillips, an economic researcher at Australian National University, pointed out to ABC News<\/a> that employee households haven\u2019t been hit as hard. He explained that the cost of living for those relying on wages and salaries has remained more manageable, with wages helping to offset the rise in costs. But for those on fixed incomes, it\u2019s been a much tougher ride.<\/p>\n\n\n\nWhat\u2019s Driving the Pain for Government Payment Households?<\/h2>\n\n\n\n