2009 Minimum Essential Standard of Living
The following tables present the cost of a Minimum Essential Standard of Living in 2009 for the 6 household types in our study
The following is presented for each household:
- The cost of a Minimum Essential Standard of living for full-time worker without entitlements to secondary benefits (the costs of housing and car ownership are excluded)
- The expenditure for specific households in the same category
- Details of total weekly income and expenditure for each household and the weekly shortfall or discretionary income.
- Two adults and Two Children ( 3 year old and 10 year old)
- Two Adults and Two Children (10 year old and a 15 year old)
- One Adults and Two Children ( 3 year old and 10 year old)
- (A) Pensioner Couple in Receipt of Contributory Pension (age 66-69)
- (B) Pensioner Couple in Receipt of the Non-Contributory Pension (age 66-69)
- Lone Female Pensioner (age 70+)
- Single Adult Male (age 25+)
Some Key Observations on the Impact of 2009 Inflation Figures on the cost of a Minimum Essential Standard of Living
Annual update of expenditure costs is undertaken in June every year using the Consumer Price Index to chart the annual change in goods and services over a 12 month period. When updating the basket of goods e.g. food, clothing, household goods etc the inflation figure for each category is used as opposed to the overall inflation figure.
Prices on average, as measured by the CPI, were 5.4% lower overall in June 2009 compared with June 2008.
The most notable changes in the year were decreases in Housing, Water, Electricity, Gas and Other Fuels (- 25.6%), Clothing and Footwear (-12.2%) Transport (-6.1%). There were increases in Miscellaneous Goods and Services (+8.5%), Education (+4.5%) and Health (+ 3.4%).
Whilst Housing, Water, Electricity, Gas and Other Fuels fell by 25.6%, a large proportion of that is taken up by a fall in mortgage interest rates which has fallen by 46.2% from June 08 to June 09. Falling mortgage interest rates generally do not benefit those on Social Welfare or low incomes as they cannot afford a house in the first place.
Whilst Transport may have decreased by 6.1%, it must be pointed out that bus fares rose in the same period by 10.9% and rail transport by 9.0%
Education rose by 4.5% in the period June 08 – June 09. Primary Education increased by 7.6%, Secondary Education by 7.1% and Third Level Education increased by 4.7%. It should be kept in mind that increases in the cost of Secondary Education may result young people from many low income households dropping out of school. Young people do not want to be an additional burden on parents who are already struggling to make ends meet.
Miscellaneous Goods and Services increased by 8.5%. Within this category Childcare increased by 6.4%, and Health Insurance by 21%. For many households Childcare is an expense that they cannot avoid. However the financial benefit of working is eroded when the only option for parents is private childcare. If the National Minimum Wage is decreased there will be a certain number of households for whom working is no longer viable as the income they earn will be absorbed by meeting their childcare needs.
When inflation figures are applied to the expenditure necessary for a Minimum Essential Standard of Living it is important to remember that this standard of living is focused on meeting physical, psychological and social needs (not wants). These budgets allow for very little additional expenditure. They also call for careful management of limited expenditure.
- Expenditure Budgets
- Income Scenarios
- Detailed Budgets