MAIN CONTRIBUTORS TO CHANGE

PENSIONER AND BENEFICIARY HOUSEHOLDS (+0.7%) The PBLCI rose 0.7% in the September quarter 2016. The main contributor to the rise is in food and non-alcoholic beverages (+2.0%), driven by fruit and vegetables. The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply. Housing (+1.3%) also contributed to the rise, driven by increases in electricity and property rates and charges. The rise in electricity is driven by increases in wholesale electricity costs across the eastern and southern states. The rise in property rates and charges is due to increases in general rates, garbage charges and other levies. Health (-2.0%) contributed the most significant partial offset this quarter, driven by pharmaceutical products. The fall is due to the cyclical effect of a greater proportion of consumers exceeding the Pharmaceutical Benefits Scheme (PBS) safety net. The PBLCI recorded the same rise as the CPI (+0.7%) this quarter. Over the last twelve months the PBLCI rose 1.5% while the CPI rose 1.3%.

EMPLOYEE HOUSEHOLDS (+0.5%)

The living cost index for employee households rose 0.5% in the September quarter 2016. The main contributor to the rise is in food and non-alcoholic beverages (+1.6%), driven by fruit and vegetables. The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply. Housing (+1.3%) also contributed to the rise, driven by increases in electricity and property rates and charges. The rise in electricity is driven by increases in wholesale electricity costs across the eastern and southern states. The rise in property rates and charges is due to increases in general rates, garbage charges and other levies.

Insurance and financial services (-1.7%) contributed the most significant partial offset this quarter, driven by a fall in mortgage interest charges with the flow on effect of banks passing on the cuts in the RBA cash rate in May and August.

The LCI for employee households recorded a smaller rise than the CPI (+0.7%) this quarter. This is mainly due to the fall in mortgage interest charges, which are not included in the CPI.

Over the last twelve months the LCI for employee households rose 1.2% while the CPI rose 1.3%.

AGE PENSIONERS (+0.8%) The living cost index for age pensioner households rose 0.8% in the September quarter 2016. The main contributor to the rise is in food and non-alcoholic beverages (+2.3%), driven by fruit and vegetables. The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply. Housing (+2.0%) also contributed to the rise, driven by increases in electricity and property rates and charges. The rise in electricity is driven by increases in wholesale electricity costs across the eastern and southern states. The rise in property rates and charges is due to increases in general rates, garbage charges and other levies. Health (-1.8%) contributed the most significant partial offset this quarter, driven by pharmaceutical products. The fall is due to the cyclical effect of a greater proportion of consumers exceeding the Pharmaceutical Benefits Scheme (PBS) safety net. The LCI for age pensioner households recorded a larger rise than the CPI (+0.7%) this quarter. Age pensioner households have a higher expenditure on food and non-alcoholic beverages, which rose this quarter, when compared to the CPI population. Over the last twelve months the LCI for age pensioner households rose 1.5% while the CPI rose 1.3%.

OTHER GOVERNMENT TRANSFER RECIPIENT HOUSEHOLDS (+0.6%)

The living cost index for other government transfer recipient households rose 0.6% in the September quarter 2016. The main contributor to the rise is in food and non-alcoholic beverages (+1.8%), driven by fruit and vegetables. The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply. Housing (+1.1%) also contributed to the rise, driven by increases in electricity and property rates and charges. The rise in electricity is driven by increases in wholesale electricity costs across the eastern and southern states. The rise in property rates and charges is due to increases in general rates, garbage charges and other levies.

Communication (-2.4%) contributed the most significant partial offset this quarter, driven by telecommunication equipment and services. The fall is due to strong continued competition amongst service providers.

The LCI for other government transfer recipient households recorded a smaller rise than the CPI (+0.7%) this quarter. Other government transfer recipient households are more heavily impacted by cyclical changes in the proportion of consumers exceeding the Pharmaceutical Benefits Scheme (PBS) safety net, when compared to the CPI population. The smaller rise for other government transfer recipient households is also due to the fall in mortgage interest charges, which are not included in the CPI.

Over the last twelve months the LCI for other government transfer recipient households rose 1.6% while the CPI rose 1.3%.

SELF–FUNDED RETIREE HOUSEHOLDS (+0.8%)

The living cost index for self-funded retiree households rose 0.8% in the September quarter 2016. The main contributor to the rise is in food and non-alcoholic beverages (+2.2%), driven by fruit and vegetables. The rise in fruit and vegetable prices is due to adverse weather conditions, including floods, in major growing areas, impacting supply. Housing (+2.1%) also contributed to the rise, driven by increases in electricity and property rates and charges. The rise in electricity is driven by increases in wholesale electricity costs across the eastern and southern states. The rise in property rates and charges is due to increases in general rates, garbage charges and other levies.

Communication (-2.2%) contributed the most significant partial offset this quarter, driven by telecommunication equipment and services. The fall is due to strong continued competition amongst service providers.

The LCI for self–funded retiree households recorded a larger rise than the CPI (+0.7%) this quarter. Self-funded retiree households have a higher expenditure on recreation and culture, which rose this quarter, when compared to the CPI population.

Over the last twelve months the LCI for self–funded retiree households rose 1.5% while the CPI rose 1.3%.

Percentage change, Commodity group - June Quarter 2016 to September Quarter 2016
	Pensioner and beneficiary LCI	Employee LCI	Age pensioner LCI	Other government transfer recipient LCI	Self-funded retiree LCI	Consumer Price Index (CPI)
Weighted average of eight capital cities						%
Food and non-alcoholic beverages	2.0	1.6	2.3	1.8	2.2	1.7
Alcohol and tobacco	1.6	1.0	1.1	1.7	1.0	1.1
Clothing and footwear	-0.4	0.2	-0.3	-0.4	-0.2	0.3
Housing(a)	1.3	1.3	2.0	1.1	2.1	1.0
Furnishings, household equipment and services	0.9	1.2	0.8	0.9	0.8	1.1
Health	-2.0	-0.1	-1.8	-2.3	-0.4	-0.2
Transport	-0.8	-0.6	-0.7	-0.8	-0.6	-0.5
Communication	-2.3	-2.3	-2.2	-2.4	-2.2	-2.3
Recreation and culture	0.5	0.5	0.5	0.4	0.7	0.6
Education	0.2	0.2	0.1	0.2	0.2	0.2
Insurance and financial services(b)	0.4	-1.7	2.2	-0.4	2.2	0.9
All groups	0.7	0.5	0.8	0.6	0.8	0.7
(a) House purchases are included in the CPI but excluded from the other indexes.
(b) Includes interest charges and general insurance, except for the CPI. Interest charges are excluded from the CPI and general insurance is calculated on a different basis.