Anti-poverty Alliance wants separate cost of living index for low income groups

Anti-poverty campaigners are calling for a separate calculation of the cost of living adjustment for certain social groups whose spending is primarily on food and medicines.

Groups such as pensioners were negatively impacted by the tendency of food and medicine prices to increase at a faster pace than the overall inflation rate, the campaigners said.

In its proposals for the Budget, the Anti-Poverty Alliance called for different indices on which the annual wage and pension increases are based.

“The current index is inadequate because it does not capture the extent of inflation on basic items like food and medicines not provided by the government… The current system is unjust on those with low incomes,” the alliance said.

COLA is calculated on the previous 12-months’ inflation rate and takes into account a basket of products and services that a typical family avail itself of. Food and medicines are only two of the various components that make up the basket.

The alliance also called for a national debate on the introduction of a Living Income that would be enough for a family to live a decent life.

The aim of the Living Income would be to strengthen the individual’s purchasing power by ensuring that inflation does not outpace wage and pension increases.

The alliance also called for further upward revisions of pensions, which it said had not been enough over the past few years because inflation ate away at the increases.

Children from precarious families where the mother does not work should be able to attend the free childcare service, the alliance added. Currently, free childcare is available for working parents.

“This proposal will help these children have an adequate social life in the future,” the alliance said.