Living Cost Indexes (LCIs) measures the price change of goods and services and its effect on living expenses of selected household types
The SLCI weights are regularly updated to ensure the weights used in the SLCI basket reflect contemporary household spending patterns. This quarter includes the introduction of updated SLCI weighting patterns for 2025. For more details refer to Annual weight update of the CPI and Living Cost Indexes.
All household types recorded increases in living costs this quarter, following smaller rises or falls in the December 2024 quarter.
Age pensioner, Other government transfer recipient and Pensioner and Beneficiary households recorded their largest quarterly increases in living costs since the March 2023 quarter. Employee and Self-funded retiree households recorded their largest increases in living costs since the June 2024 quarter.
Health, Housing and Food and non-alcoholic beverages were the main contributors to the rise in living costs across all household types this quarter.
Medical and hospital services and Pharmaceutical products rose as a result of the cyclical reduction in the proportion of households who qualify for subsidies under the Medicare Safety Net and Pharmaceutical Benefits Scheme (PBS). The safety net thresholds for both the PBS and Medicare are reset on 1 January each year. Increases for Medical and hospital services and Pharmaceutical products are expected in the March quarter due to the resetting of the safety net thresholds.
All household types recorded rises in Housing driven by an increase in Electricity. Electricity rose as most households in Brisbane had used up the $1,000 Queensland State Government electricity rebate resulting in higher out of pocket electricity costs. Some households in the remaining states and territories also saw rises in electricity bills this quarter due to the timing of the 2024-25 Commonwealth Energy Bill Relief Fund rebate payments. More details on the impact and timing of these rebates are provided in the latest Consumer Price Index publication.
Food and non-alcoholic beverage prices rose across all household types, driven by Fruit and vegetables. Fruit and vegetables such as avocados, mangoes, asparagus, tomatoes and lettuce saw seasonal price rises following reduced supply.
Living costs for Other government transfer recipient (+1.6%) and Age pensioner (+1.5%) households rose this quarter. The Pensioner and Beneficiary LCI (PBLCI) recorded a 1.6% rise. Households represented by these indexes source their principal income from government payments.
The increase in living costs for these households were driven by a rise in Health. The cost of Pharmaceutical products and Medical and hospital services rose due to the cyclical reduction in the proportion of households who qualify for subsidies under the PBS and Medicare Safety Net, with the safety net thresholds for both resetting from 1 January each year.
Other government transfer recipients and Age pensioner households pay concession prices for Pharmaceutical products and recorded a larger rise from the safety net threshold resetting compared with non-concession households.
Living costs for Employee households, whose primary source of income is wages and salaries, rose 1.1% over the March 2025 quarter, up from a 0.4% rise in the previous quarter.
Mortgage interest charges make up a higher proportion of expenditure for Employee households. Mortgage interest charges rose 1.5%, down from a rise of 1.7% in the December 2024 quarter, due to higher mortgage debt levels and the continued roll-over of expired fixed-rate to higher variable rate home loans. The effect of the Reserve Bank of Australia’s cash rate cut in February 2025 will be seen in the June 2025 quarter due to the timing of the change in the cash rate.
The following graph shows the share of fixed and variable rate home loans for owner occupied loans. The share of fixed rate home loan commitments has continued to decline in the March 2025 quarter, while the share of variable rate home loans has continued to increase reflecting the continued roll-over of expired fixed rate to higher variable rate home loans.
Education also makes up a higher proportion of expenditure for Employee households. Education rose 5.3% reflecting fee increases for secondary and pre-school and primary education at the start of the school year due to higher operating costs, and annual CPI indexation being applied to university course fees at the start of the year for tertiary education.
Employee households recorded the smallest rise in Health this quarter. Employee households pay non-concession prices for Pharmaceutical products and recorded a smaller rise from the PBS safety net threshold resetting on 1 January compared to government payment recipient households who pay concession prices.
Self-funded retiree households, whose primary source of income is superannuation or property income, rose 0.6% this quarter, up from 0.3% in the December 2024 quarter.
Self-funded retiree households have recorded the weakest rise in quarterly living costs of all the household types, primarily due to a fall in Holiday travel and accommodation. Holiday travel and accommodation makes up a higher proportion of expenditure for Self-funded retiree households than it does for other types of households. International holiday travel and accommodation prices fell this quarter due to lower demand following the peak December holiday period.
Over the past twelve months, the five LCIs rose between 2.4% to 3.5%, following rises between 2.5% and 4.0% in the December 2024 quarter.
Households whose main source of income is government payments recorded higher rises in annual living costs compared to the December 2024 quarter, while Employee and Self-funded retiree households recorded weaker rises compared to the December quarter.
Other government transfer recipients recorded the largest annual rise in living costs of all the household types, rising 3.5% over the past twelve months, up from 3.2% in the previous quarter. Rents and Tobacco make up a higher proportion of expenditure for this household type, both recording strong rises over the past twelve months.
The annual rise in Rents reflects tight rental markets over the last twelve months, however annual growth for Rents has continued to ease this quarter. The annual rise for Tobacco is mainly due to the biannual AWOTE indexation applied in September 2024 and March 2025.
Employee households recorded the next largest annual rise in living costs, rising 3.4% over the past twelve months, down from 4.0% in the previous quarter and down from a peak of 9.6% in the June 2023 quarter.
Mortgage interest charges was the most significant contributor to the increase in Employee households’ living costs which rose 8.8% over the past twelve months. Mortgage interest charges inflation has continued to ease from a peak of 91.6% in the June 2023 quarter. The Reserve Bank of Australia’s (RBA) decision to keep the cash rate on hold between December 2023 and January 2025 and the slowdown in the rollover of low fixed rate loans into higher variable rate loans led to the easing in annual growth of Mortgage Interest charges.
The remaining three household types recorded annual rises in living costs between 2.4% and 3.2%. Insurance and financial services and Food and non-alcoholic beverages were the main contributors across the household types.
Higher premiums for house, home contents and motor vehicles insurance over the past twelve months have resulted in strong annual growth in Insurance across all household types. However, annual growth in Insurance has continued to moderate this quarter due to an easing in reinsurance and replacement and repair costs.
Age pensioner (+2.9%) and Self-funded retiree (+2.4%) households recorded the weakest annual rises in living costs of all household types. Mortgage interest charges, Rents and Tobacco, which rose over the last twelve months, make up a smaller proportion of spending for these household types.
Insurance and financial services and Food and non-alcoholic beverages were the main contributors to the rises in annual living costs across most household types.
| Household type | Main annual contributors |
|---|---|
| Pensioner and beneficiary (PBLCI) | Insurance and financial services (a) (+7.9%) Food and non-alcoholic beverages (+3.4%) Housing (b) (+2.7%) Alcohol and tobacco (+8.3%) |
| Employee | Insurance and financial services (a) (+8.2%) Food and non-alcoholic beverages (+3.2%) Alcohol and tobacco (+6.4%) Housing (b) (+2.4%) |
| Age pensioner | Food and non-alcoholic beverages (+3.5%) Health (+5.1%) Insurance and financial services (a) (+7.6%) Housing (b) (+2.3%) |
| Other government transfer recipient | Housing (b) (+3.3%) Insurance and financial services (a) (+8.1%) Alcohol and tobacco (+9.1%) Food and non-alcoholic beverages (+3.3%) |
| Self-funded retiree | Food and non-alcoholic beverages (+3.4%) Health (+4.3%) Insurance and financial services (a) (+7.1%) Alcohol and tobacco (+5.4%) |
For information on the weighting pattern for the SLCIs, please see Selected Living Cost Indexes, Australia methodology and the Annual weight update of the CPI and Living Cost Indexes, December 2024.
| Weighted average of eight capital cities | Pensioner and beneficiary LCI (%) | Employee LCI (%) | Age pensioner LCI (%) | Other government transfer recipient LCI (%) | Self-funded retiree LCI (%) | Consumer Price Index (CPI) (%) |
|---|---|---|---|---|---|---|
| Food and non-alcoholic beverages | 1.3 | 1.2 | 1.3 | 1.3 | 1.2 | 1.2 |
| Alcohol and tobacco | 1.3 | 1.3 | 1.2 | 1.4 | 1.1 | 1.2 |
| Clothing and footwear | -1.0 | -0.9 | -0.8 | -1.3 | -0.7 | -0.8 |
| Housing (a) | 2.4 | 2.7 | 2.4 | 2.4 | 2.8 | 1.7 |
| Furnishings, household equipment and services | -0.7 | -0.8 | -0.9 | -0.7 | -1.1 | -0.9 |
| Health | 8.0 | 2.5 | 6.9 | 9.5 | 3.2 | 2.9 |
| Transport | 0.9 | 0.9 | 0.9 | 1.0 | 0.9 | 1.0 |
| Communication | -0.3 | -0.3 | -0.2 | -0.3 | -0.2 | -0.3 |
| Recreation and culture | -0.9 | -1.6 | -1.3 | -0.7 | -2.4 | -1.6 |
| Education | 5.5 | 5.3 | 4.0 | 5.6 | 5.6 | 5.2 |
| Insurance and financial services (b) | 0.9 | 1.3 | 0.6 | 1.1 | 0.3 | 0.5 |
| All groups | 1.6 | 1.1 | 1.5 | 1.6 | 0.6 | 0.9 |
For further analysis on commodity group contributors, please see the latest release of the Consumer Price Index.
Price indexes published by the Australian Bureau of Statistics (ABS) provide summary measures of the movements in various categories of prices over time. They are published primarily for use in Government economic analysis. Price indexes are also often used in contracts by businesses and government to adjust payments and/or charges to take account of changes in categories of prices (Indexation Clauses).
Use of Price Indexes in Contracts that sets out a range of issues that should be taken into account by parties considering including an Indexation Clause in a contract using an ABS published price index.
The Frequently Asked Questions page that has answers to a number of common questions to do with price indexes and the Consumer Price Index, in particular.
This release previously used catalogue number 6467.0.