Not being able to afford telecommunications services is a key challenge. For some households it was made worse by the impact of lockdowns on businesses and Jobs.
Overall, the cost and affordability of telecommunications services has improved, as services in real terms have become far more affordable. Australian Bureau of Statistics Consumer Price Index (CPI) data shows telecommunications prices have fallen 14% since 2000, while the CPI overall has increased by 68%.57 By comparison, the cost of food has increased by 63%, energy costs have doubled, and the cost of health care has gone up by 134%.
Telecommunications pricing trends are partly due to high levels of competition across fixed and mobile markets. Another factor has been the NBN Co's introduction of lower-cost, entry-level broadband services to ensure low-income families and people with simple connectivity requirements could still get access. There has also been an overall decrease in NBN wholesale prices.
Conversely, some households are now spending more money on internet services because they are having to buy more data.58
Other research shows a widening gap in affordability between the lowest-income and highest-income segments, according to the Australian Communications Consumer Action Network (ACCAN).59 While the average household spends 3.5% of disposable income on communications, the lowest income decile spends around 10%. The ADII shows the proportion of household income spent on internet access by those living in the lowest household income quintile has increased every year since 2014.60
The Australian Government currently offers the telephone allowance, a quarterly payment to help with phone and internet costs.61 This provides a safety net to recipients of certain government payments.
" While the average household spends 3.5% of disposable income on communications, the lowest income decile spends around 10%. "
While competition remains the most effective way to deliver good value to the market, the Department of Infrastructure, Transport, Regional Development and Communications should monitor entry-level pricing of broadband services to ensure families on a tight budget can get online and stay online.