A variety of sources have made claims in relation to cost of living increases in QLD that we have been requested to investigate. Below are some of our findings so far that relate to those claims, so they can be considered from an objective perspective.
Electricity prices
Claim – Power prices are up 162%. This appears to be a ‘blanket’ statement that could lead you to believe it is related to your home electricity prices. However, when you look at sources quoted, they are referring to wholesale prices (what the electricity retailers pay the generators) and for the period 2021-22 when prices were more volatile due to inflation impacts. Wholesale costs increases have been attributed to price increases on world energy markets impacted by the Ukraine war and sanctions on Russia.
The Queensland Competition Authority provides data on the actual retail electricity prices (what we consumers pay) since 2015-16. Here is what they say on page 12 of SEQ retail electricity market monitoring 2021-22:
“The average market offer bill—for the typical SEQ customer—trended downwards following Alinta Energy’s entry into the SEQ market in August 2017. However, this trend did not continue in 2021–22 as wholesale electricity costs increased substantially and started to translate into higher retail prices. In the past year (June quarter of 2021 to June quarter of 2022): the average highest market offer bill increased by 15.2%”
So, retail prices for consumers as reported went up in 21-22 by 15%, not 162%, and if you look at the chart on that page you can see that prices were lower than in 2015.
Compared to other states Queensland electricity prices are below average (source: https://www.finder.com.au/average-cost-of-electricity published 11 May 2023) –
State Average electricity usage rate (per kWh)
Australian Capital Territory 29.15c/kWh
New South Wales 29.04c/kWh
Northern Territory 27.37c/kWh
Queensland 25.67c/kWh
South Australia 36.10c/kWh
Tasmania 26.80c/kWh
Victoria 22.39c/kWh
Western Australia 30.06c/kWh
Update 1 June 2023 – Coming price increases
For the coming year electricity prices are expected to rise significantly in the next financial year 2023-24. The Australian Energy Regulator has announced that the Default Market Offer (the basic electricity cost, if you haven’t chosen a better deal) will increase 21% next year. More information is available on this Fact Sheet.
Update 20 June 2023 – impacts of delays in reopening closed power plants
Claims have been made that a delay in repairing the coal powered Callide Power Station will drive consumer electricity prices up.
The Callide station has two units, B and C, and can generate up to 1720MW of electricity. In May 2021 an explosion knocked out Callide C, and repairs have been ongoing since then (see the following article from the plant operator www.csenergy.com.au/news/updated-return-to-service-dates-for-callide-c-generating-units/may2023).
The units were expected to be back in operation by Jan 2024, however delays in repairs have led to those dates being revised. Unit C3 was expected to be operational by 31 Dec 23 and is now expected repaired by mid-Feb 24 ( a delay of six weeks). Unit C4 was expected to be operational 31 Jan 24 and is now expected on 6 July 24 (a five-month delay). Since the plants have been out of operation since May 2021 this represents a 4% and a 14% delay respectively.
It has been reported that these delays will impact wholesale prices, however it may have limited impact on consumer prices. Rod Campbell, an energy economist and Research Director at the Australia Institute, a Canberra based climate change and policy research organisation, said when asked by the ABC: “Callide represents a little bit less than 10 per cent of the coal-fired generation capacity in Queensland, so 90 per cent of that capacity should be unaffected [by the delay],” he said. ”By the time that minor change to generation cost gets passed through transmission and distribution costs and retail costs, I really don’t think this will be something that most households will discern at all.” www.abc.net.au/news/2023-05-30/qld-callide-coal-power-delays-energy-prices/102409862.
Car registrations and licenses
Claim – Car Registration is up 28% and Drivers Licences are up 25%. For car registrations, we have not been able to access historical data, however the stated 28% increase is since 2015-16, seven years. That implies an annual increase of 3.5 percent, about twice the rate of general price rises (inflation) which appears to be the same for boat registrations and drivers’ licences. These charges increased above inflation due to the Government raising them at a higher rate, however we would need more time to analyse the specifics as to ‘why’. As it stands, the comparative costs to other states for a driver’s license are:
1yr 3yr 5yr 10yr
Qld $85 Na $191 Na
Vic Na $85 Na $292
NSW $62 Na $194 Na
So, for a 5-year license, QLD is about the same as NSW, and higher than Victoria.
Car registrations and licenses
Claim – Car Registration is up 28% and Drivers Licences are up 25%. For car registrations, we have not been able to access historical data, however the stated 28% increase is since 2015-16, seven years. That implies an annual increase of 3.5 percent, about twice the rate of general price rises (inflation) which appears to be the same for boat registrations and drivers’ licences. These charges increased above inflation due to the Government raising them at a higher rate, however we would need more time to analyse the specifics as to ‘why’. As it stands, the comparative costs to other states for a driver’s license are:
1yr 3yr 5yr 10yr
Qld $85 Na $191 Na
Vic Na $85 Na $292
NSW $62 Na $194 Na
So, for a 5-year license, QLD is about the same as NSW, and higher than Victoria.
Wellcamp
Claim – $220 million wasted on Wellcamp – that’s $500,000 every day. It seems incredibly wasteful that the Government spent $200m for a quarantine facility on leased land, then handed it over when the lease ended (after 1 year). We will investigate more during the Budget Estimates process, however it may be that given the cost of leasing hotel rooms and projections that the pandemic would last longer, building a facility of this nature may have appeared more economical than leasing the equivalent hotel rooms for a year. We will post further information when available.
Housing crisis and rent
Claims that any particular political party will “ease the housing crisis to bring down rent costs” are very hard to consider when no details on how has been included. However, the Greens have presented at least 2 Bills, with one that proposed a ‘windfall’ tax that would see an increase of funds made available for community housing which I have mentioned in speeches. However, with the materials supply/labour issue, this would not give any immediate relief. This situation is not simply about throwing more money at the issue, as it will require programs such as the Federal PALM program to import labour from overseas, as well subsidising to set up production of supplies which has already started. However, importing labour brings the question of where they will be accommodated, given our housing crisis. Even charging ‘empty house’ taxes will not resolve, as the majority of such houses in Noosa are in the multimillion-dollar range, where rents would not be affordable for those currently impacted. As well, the owners could potentially absorb any extra charges and leave them empty.
Of concern, is the State Government land tax, which applies to properties (other than your place of residence) and is based on the unimproved value of the land. Land valuations for taxation purposes have risen precipitously in the Noosa region in the last year, for example Noosa Heads valuations were up 70% in the year to 1 October 2022.
These increases are too big to be absorbed already burdened businesses in the ongoing fallout from COVID, including an inability to access staff, hence they get passed on directly to the end user including commercial tenants.
The tax will also impact on the residential market, and we have a number of investors including ‘mum n dad’ owners who will need to pass on these increases to their tenants. Given our affordable housing and rental crisis, we must avoid any increases that will further impact those already under severe financial stress.
We have advocated freezing tax increase to the 2021 valuations for residential and commercial properties that are being rented out and reform the system by providing Queenslanders the details of how each individual property valuation was arrived at and establishing an independent body to assess objections.
At the May sitting of Parliament, the Crossbench united in a call to government on a number of issues in relation to the 2032 Games, including the impacts on housing and rents, which can be found here.
Updates regarding our advocacy regarding housing can be found here.
Social housing
Queensland, and indeed Australia, has underinvested in social and affordable housing for a long time, with the Queensland Council of Social Service(QCOSS) recently releasing a report that says to meet the backlog of unmet need and future proof for the next twenty years Queensland should be expanding its social and affording housing by 11,000 homes a year. As the QCOSS report stated: “This is a significantly higher ask than the average annual number of social and affordable rental dwellings – 1,300 – expected to be built over the next ten years under existing Queensland Government financial commitments”.
Of interest is that the previous Federal government stopped an important affordable housing initiative NRAS, which we have been advocating for to be reinstated, or replaced.
There are many ways to increase funds for community housing which is what is needed for our workers; however, we need solutions right now and as per our Noosa 360 posts over the past 5 years. There are several interim solutions including sharing homes as per the Better Together Housing program, as well utilising sites which frustratingly Government are not supportive of due to the location, or not meeting the business case due to the price of land in our community vs other locations with cheaper land. We are currently waiting for details of a Noosa site identified in the long overdue full government audit of land, whilst the Department of Housing work with Noosa Council on the development of the purchased Doonella St site, and we will keep updating of these and other projects in the works as more information becomes available.
Politics in the lead up to elections are always interesting, with information presented in a way to appeal to voters. This is done by all political parties, regardless of who is in government and who is the opposition of the day. It is always important to research information fully before being influenced in your vote!
If any Noosa Electorate residents have any further questions, please feel free to email our office via noosa@parliament.qld.gov.au for us to investigate.