How does the cost of living in Kiwis compare to some other countries?

All over the world people are having to watch their coins as the cost of living rises. Making things tougher, food prices have risen even faster than overall inflation.

Here, rising food prices have been painfully evident at supermarket checkouts. Despite that, inflation has been contained in this country more than in many other places.

And in many countries, including New Zealand, residents are protected from the full impact of rising prices by some level of government subsidies.

Statistics NZ estimates annual consumer price inflation in the country was 7.2 percent in the year to September.

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Food price increases were worse, at 10.7 percent in the year to November.

In some ways, even that doesn’t show how hard things are. For fruit and vegetables alone, prices are up 20 percent year-on-year, while meat, poultry, and fish are up 12 percent.

This suggests that inflation in 2022 will be very damaging to those who are already struggling and are spending all their money on essentials.

In many other developed countries, prices have risen even faster.

The average CPI increase in OECD economies was 10.7% in the year to October (compared to our 7.2% for the year to September). The OECD total includes a 16.1 percent increase in food prices and a 28.1 percent increase in energy prices.

This is a broad view. A better indication of how well we are containing inflation may come from comparing our performance with three other rich countries with similar populations – Ireland, Norway and Singapore.

Ireland

Looking at Ireland, inflation hit 9.2% in the year to October and energy companies had announced that price increases of up to 47% would be implemented at the start of the month.

Electric Ireland, the country’s largest energy supplier, has increased residential electricity bills by 26.7% and gas bills by 37.5% since October 1.

The company’s chief executive Pat Fenlon said it was an unprecedented time for the energy industry, with wholesale gas prices rising more than 700 per cent in the past 12 months, including 200 per cent between June and September 2022.

Electricity was up 71% in the year to October and gas was up 93%, Statistics Ireland said.

Food and non-alcoholic beverages rose 10.6 percent, almost as much as the 10.7 percent increase in food prices in the country.

The OECD reported that the Irish government helped residents and SMEs with a range of relief measures.

This included a cut in petrol tax, a subsidy for public transport, and an increase in electricity credits of €600 (NZ$987) for households, paid in three installments this northern winter.

Average national food prices in October, published by the CSO, included 1kg of sirloin steak at €16.04 (NZ$26.37), 1kg of lamb chops at €21.465 (NZ$35.30), 2 liters of full-fat milk at €2.123. Euro (NZ$3.48), 1 kg of Irish Cheddar at €10,142 (NZ$16.67), half a dozen large eggs at €2,044 (NZ$3.35), and 1 lb of butter at €3,700 (NZ$6.08).

Norway

In Norway, CPI rose to 7.5% in the year to October, then eased to 6.5% in the year to November.

The rise in inflation was curbed by generous government support to counter rising electricity prices.

Without the support, CPI would have risen 8.4 percent in the year to November and 9.5 percent in the year to October, according to Statistics Norway.

As a major oil and gas producer, Norway has also benefited from the rapid increase in fuel prices.

Food and non-alcoholic beverage prices rose by 12.7 percent year-on-year, while residents faced a limited increase of 4.9 percent in housing, water, electricity, gas and other fuel costs. Transportation increased by 9.6 percent.

Statistics Norway said billions of dollars in government support meant that the real amount households paid for electricity in the third quarter of 2022 was only 3.1 percent higher than in the second quarter. And it was well below the record high paid in the fourth quarter of 2021.

Singapore

In Singapore, CPI rose 6.7 percent in October from a year earlier, down from the previous month, Statistics Singapore data showed.

Food increased by 7.1%, clothing by 3.2%, housing by 4.9%, electricity and gas prices by 19% compared to the previous year (although the household tariff for the fourth quarter of 2022 was lower than the third quarter). and transportation by 15.5 percent (of which public transportation increased by 8.8 percent).

The Singapore government said the support measures provided during 2022 will cover the average annual increase in living costs of low-income households.

The measures also cover more than half of the cost-of-living increase for middle-income households.

The support included a special payment of up to S$300 (NZ$345) in cash for low- to middle-income Singaporeans and a S$100 (NZ$115) home improvement credit for all Singaporean households.

A second support package was announced in October. Both that and the previous package were valued at S$1.5 billion (NZ$1.726 billion) each.

The second package included a special cost-of-living payment of up to S$500 (NZ$575) for 2.5 million Singaporean adults.

In this country, the government paid $350 in cost-of-living payments in three categories for anyone aged 18 or over who earned less than $70,000 a year.

compare

Comparing the cost of living between countries is complicated.

The website Numbeo, which bills itself as the “world’s largest cost of living database,” provides an indication of prices around the world by aggregating information on prices from users around the world. It also uses resources such as websites of supermarkets and government institutions.

It tries to provide an overview of all that information in the quality of life index. These factors include purchasing power, health care, safety, pollution, traffic and weather.

For the overall index – where the higher the number, the better the quality of life – New Zealand scores “very high” at 188.49, Norway at 182.44, Ireland at 154.68 “high” and Singapore at 151.20.

For the purchasing power category – where higher is better, New Zealand scores “very high” at 113.09, Norway “high” at 94.33, Singapore at 91.62, and Ireland at “average” at 83.85.