Poverty Premiums: Why it costs more to be poor

“Poverty premiums” are extra costs which accrue to people on a low incomes precisely because they are on those low incomes. It’s a term that refers to things like not having enough cash to take advantage of money-saving technology or to buy in bulk to avoid extra costs.

Our media release is here: Vegemite Index and Cloaks of Invisibility: poverty premiums show why it costs more to be poor

read the report

The 2024 Anti-Poverty Week Statement provides examples of how each of these premiums apply. For some of the examples, the sums of money may not be huge, but the percentages are significant and, if extrapolated across a range of costs for low income households, the impact of poverty premiums can be significant.

download info sheet

You can help spread the word by downloading and printing the poster above to display how things can be more expensive the less money you have. It turns out that you have to have money to save money. 

sign the petition

The best way to solve poverty is pretty straightforward – raise the rate. ACOSS has released a briefing note – Poverty in Australia: Facts and Solutions that explains why increasing income support is so important. You can help by signing the petition. 

why it costs more to be poor

cloaks of invisibility

You can miss out on concessions despite being as poor or poorer than those who are eligible.

For instance, a discount ambulance cover is available to someone with a Pensioner Concession Card, but not to those on lower Centrelink incomes or earning less than the pension. 

vegemite
index

Vegemite illustrates the   dilemma of someone experiencing poverty only having enough for the smaller quantity which means forgoing the bigger jar which has a cheaper unit cost.

For example, a 150g jar costs $4 at $2.67/100g, which is 59% extra per unit than the big jar, which, at $9.40 is $1.68/100g.

punishing payments

Fees and fines that don’t take income into account are devastating if you are on a low income or not much of a deterrent for those on high incomes.

A general littering fine of $210 is a crippling 53% of a weekly JobSeeker Payment, but just 5% of the weekly wage of someone on $200K.    

low-income lockouts

Not being able to afford or, as a renter, not being free to install money-saving measures such as insulation and draught-proofing locks you into paying more for essentials.

The Climateworks Centre at Monash University estimates that thermal efficiency upgrades of a poorly performing house could save up to $2,200 per year on energy bills.

petty penalties

Sometimes you can cop fees and charges for not having enough to pay a bill on time.

Banks charge a dishonour fee (approx $15) if there are not enough funds in an account to cover a payment, while utilities can charge late payment fees if you don’t have the cash the day the bill is due.   

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MICHELE WACHLA

Michele is an accomplished social services professional with a dual background in Social Work and Business, bringing over 18 years of experience to her work. She has developed a deep understanding of the unique challenges and opportunities within Regional, Rural, and Remote (RRR) environments, particularly in South Australia. Michele is a recognised leader, known for her expertise in designing and implementing place-based initiatives that address the complexities of RRR communities. Her work is underpinned by strategic planning, effective resourcing, and a strong focus on policy review and advocacy to ensure that services remain relevant, equitable, and sustainable. Michele’s commitment to community-centred approaches drives meaningful outcomes, nurturing resilience, and growth across regional South Australia.

KHATIJA THOMAS

DAVE ADAMSON

Dave moved to Australia following a 30-year academic career in the UK. He has since worked in the Community Housing sector and authored the 2016 Towards a National Housing Strategy, and helped to establish the Everybody’s Home campaign. He also researches the interface between poverty and climate change and actively supports the United Nations Sustainable Development Goals. He has worked with government at all levels and has experience of policy development and evaluation. He is co-author of Sustainable Places: Addressing Social Inequality and Environmental Crisis (2022, Routledge). In his spare time he plays and builds guitars.

ROHAN FEEGRADE

Rohan is an experienced and forward-thinking CEO, senior executive and board director with demonstrated expertise across the not-for-profit, private and government sectors. Currently CEO of Lutheran Care, he has proven record for creating substantial organisational, stakeholder and client value, and has extensive experience in strategically positioning organisations for transformational change and growth within the health, disability, education and community service sectors. Rohan is a socially responsible professional, genuinely passionate about creating opportunities for people who live with disadvantage and disability, always acting ethically to serve those he works with and for.

JANE MUSSARED

Jane has worked in for purpose and government health and human service settings throughout her career. In June 2024 she returned to SA and joined the Maggie Beer Foundation as CEO following 20 months based in Canberra as an Advisor to the Federal Minister for Health and Aged Care. Previously she was Chief Executive of COTA SA and before that an executive of ACH Group. Jane served on a range of boards and committees prior to moving to Canberra, including the SACOSS Policy Council until 2022, as chair of the South Australian Circus Centre and as a non-Executive Director with the Maggie Beer Foundation.

NANCY PENNA

Nancy has than 30 years of experience in South Australian community services, and a a unique understanding of the political and social landscape and the issues and opportunities facing South Australia. Currently responsible for the strategic and operational oversight of AnglicareSA’s community services portfolio, she has previously held executive roles in government within child protection and disability, with her executive experience underpinned by her earlier career as a social worker in child protection and youth justice. She is also Chair of the Child and Family Focus South Australia (CAFFSA) Board and most recently on the Housing Security for Older Women Taskforce.

NICOLE CHAPLIN

Nicole is a dedicated and experienced youth support professional, specialising in solutions for disadvantaged young people in South Australia. As CEO of St John’s Youth Services, she oversees innovative programs like youth110 and Foyer Port Adelaide. With over thirty years in the community sector, Nicole has built extensive networks and her expertise spans governance, service delivery, policy development, and partnerships. Recognised with the 2018 AHI Inspirational Leader Award, Nicole is an active participant in housing and homelessness networks. She holds leadership roles in various organisations, including Anglicare Australia’s National Reconciliation Network.

EMMA CROSBY

Emma is a chartered Accountant with more than 15 years experience as a board member, finance and business professional, strategic advisor and company secretary. She has strong values and a passion for enabling and leading organisations to meet its operational and strategic direction through long-term financial sustainability, operational efficiency, innovation, leadership, transformation and partnerships. As Treasurer and Board member at SACOSS, she is committed to successfully leading and making a purposeful impact to the organisation and its stakeholders.

David PANTER

David has worked in health and social care for almost 45 years, over half of which has been as a Chief Executive. In the UK he initially worked in the NHS and more latterly in local government, where he was Chief Executive of Brighton & Hove City Council. In 2004 David was recruited to the South Australian public health system for over 10 years leading reforms including the development of the new Royal Adelaide Hospital. From 2015-2022 David was the Chief Executive of not-for-profit aged care provider ECH. At the end of January 2022 David became the Chief Executive at Minda, SA’s largest provider of services to people living with an intellectual disability.

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