THE carbon tax has boosted the cost of living scarcely at all. Despite dire talk of an ''almost unimaginable'' increase (Tony Abbott) and $100 for a Sunday roast (Barnaby Joyce) the first official consumer price figures show a far lower impact than predicted by the Treasury.
Last July, Treasury said the tax would push up the consumer price index 0.70 percentage points, adding $9.90 per week to average household costs. In return, households were given compensation averaging $10.10 per week.
But 0.70 percentage points looks like being an overestimate. Inflation figures for the September quarter - the one that encompasses almost all of the electricity and gas price rises - show them adding 0.44 points to the CPI. It's a big figure, but not that much bigger than the usual September quarter slug.
Melbourne households have endured a 13.6 per cent increase in electricity prices - unwelcome but well short of previous September quarter jumps of 19 per cent and 21 per cent.
Nationwide, electricity and gas price rises have added 0.25 and 0.33 points to the consumer price index in the past two September quarters. Treasury expected the gas and electricity price hikes to account for only half of the 0.70 boost, the rest being accounted for by businesses that passed them on.
But Commonwealth Bank senior economist Michael Blythe makes the point that if the electricity and gas impact is about half what was expected, it is likely the total impact will be, too.
''It is looking as if the Treasury's figure will be an overestimate rather than an underestimate,'' he said.
The total consumer price index increased 2 per cent in the year to September, a figure right at the bottom of the Reserve Bank's 2-3 per cent target band, giving its board room to cut interest rates again at its next meeting on Melbourne Cup Tuesday. Futures markets were last night pricing in a 60 per cent chance of a rate cut.
