Groceries sit 25 to 35 per cent above 2021 and are not returning, and renting households now pay a record share of their income. Relief was offered and it operated on the price rather than the cost, so it expired. Ten steps, and the two that change what a household needs to spend at all.
Cheese is up 27.3 per cent, bread 24.1, milk 22.7 and eggs 19.7. Bread, fruit, oils, snacks and coffee have each risen more than 20 per cent. Groceries sit 25 to 35 per cent above 2021 levels and there is no mechanism by which they return there.
A family of four has gone from $216 to $240 a week — $12,480 a year, and close to $3,000 more than the same shop cost in 2021. And part of the real increase never appears in the figures at all: shrinkflation reduces the quantity while holding the price, so the unit cost rises invisibly.
Food inflation is now reported at around 3 per cent. That is 3 per cent applied to prices that already rose by a quarter to a third. Falling inflation is not falling prices.
Australians now spend a record 33.1 per cent of gross income on rent — the national median has passed the threshold used to define rental stress. A household at the twenty-fifth income percentile spends 54.3 per cent. And one in ten renters now spends more than 60 per cent of their income on rent, up from 7 per cent in 2023 and 4 per cent in 2022.
Perth and Brisbane have the fastest rent growth in the country at 6.7 per cent annually, with Perth vacancy below 0.8 per cent. Underneath it, Australia builds 160,000 to 170,000 dwellings a year against demand above 240,000 — a shortfall of 70,000 to 80,000 a year, compounding.
Electricity rose 33.9 per cent in the year to September 2025 and 25.4 per cent to March 2026, as state rebates were exhausted.
The reason is the most important mechanism in this policy. In November 2023 the Bureau of Statistics reported that electricity had risen 8.8 per cent since June — and added that excluding the rebates, prices would have increased 19.0 per cent. The underlying price rose 19 per cent. The published price rose 8.8. The difference was public money, and it did not reduce the cost of generating a unit of electricity by a cent.
Then the rebates ran out, and the published price rose to meet the real one. The rebates did not lower the price of electricity. They concealed it, and then handed it back.
Australian agriculture recorded 10.4 per cent productivity growth last year, leading every industry in the country, while national multifactor productivity fell 0.5 per cent. The farms got roughly ten per cent more efficient in a year and food still costs a third more. The problem is not the farm. It is everything between the farm gate and the shelf — processing concentrated into fewer hands, energy as an input, freight, and no visibility of margin at any point in the chain.
The cost of living is the first order of business of a Sovereign Australia government — not a chapter of a budget, but the standard every other policy is measured against, on one question: does it leave a household better off.
Cost of living is the priority of government. Every other policy is measured against whether it makes a household better off, and the test is published rather than asserted.
The principle underneath all ten: the job of government is not to hand back a fraction of what it let get away. It is to stop the price getting away in the first place.
Australians keep more of what they earn. The fastest way to raise what a household has is to stop taking it in the first place.
$50,000 tax-free threshold from day one, funded by charging properly for the ore rather than borrowed. $0 bulk-billed GP visits and childcare capped at $10 an hour — two costs that function as a tax on working parents and on anyone who gets sick.
Power prices everything else — food, freight, rent, every service. Energy is an input, not a line item, and a rise in it arrives later as a rise in the price of groceries. Cheap energy is a grocery policy.
The aim is a maximum of 10c/kWh for households and small business, legislated within the first term, with transmission and retail margins capped and a domestic gas reservation. Fuel sovereignty, with import parity and refinery margins published so the pump price can be checked against the landed cost.
Two chains hold more than 65 per cent of the grocery market and one company now owns most of the milk. Concentration is not efficiency. It is the power to set a price.
The ACCC given divestiture powers, a mandatory code of conduct with criminal penalties, and mandatory publication of live price data so anyone can build a comparison tool. The Commission recommended that last one and it was not implemented.
A working plant gets sold, not shut. In 2025 one company acquired its largest competitor for $3.4 billion and has since closed three processing plants — including one in a Gippsland town where it employed about 7.5 per cent of the local workforce. Farmers had formally warned the regulator that consolidation would cost regional processing capacity. The acquisition was approved anyway.
A last-resort sale obligation on processing capacity of regional or national significance: offered for sale at independent valuation before closure is permitted. Enforceable capacity conditions attached to merger approvals in critical food processing.
An option for people the market has priced out — not a model for everyone. One kitchen, one laundry, one workshop serving many households instead of one of each. Own the dwelling, lease the land. Costs fall because less is duplicated, not because someone else pays.
Community Towns on rural land and City Communities in converted commercial buildings, at rents around $150 a week. Neither is legal to build at scale today, because state planning instruments contain no zone that permits them. Alongside them, rent increases limited to once a year and mortgage relief for households in genuine hardship.
Food forests, community gardens and working land inside the settlement. Fifty million food-producing plants on public land within five years — nature strips, median strips, parks, school and hospital grounds — with community stewardship from day one.
Every meal grown is a meal that never had a price.
The Consumer Price Index is a sample, published quarterly. By the time a category is confirmed to have risen, it has been rising for months. A basket is a sample. A million products is a census.
An AI dashboard tracking approximately one million products from farm gate to shelf in real time, published rather than held, inside the Department of Australian Automation. It makes the margin visible while it moves, and it detects shrinkflation automatically — which a shopper cannot.
When a staple rises, act on that thing quickly, rather than waiting a year for a statistic and then raising every mortgage in the country.
Start where the cost starts. If eggs are dear, help the farmer with what made them dear — feed, power, fuel, freight — because a cost removed at the farm reaches the shelf. Price controls are the last option, not the first, and only on staples. Hungary capped food prices and now has the highest food inflation in the European Union. Subsidise a price and you hide it. Reduce a cost and you change it.
Prices do not go back down. Groceries at 25 to 35 per cent above 2021 are the new base, and every future increase compounds on it. The only permanent answer is incomes rising faster than prices.
Australian multifactor productivity fell 0.5 per cent last year, and the 2010s were the weakest decade in sixty years. Treasury and the Reserve Bank estimate that restoring competition to early-2000s levels would add $2,000 to $6,000 per household — permanently, against energy rebates worth a few hundred dollars, once, borrowed. Wages protected, business unleashed, a welfare floor at 65 per cent of the minimum wage, and a Citizen Dividend from Year 5 as the sovereign fund matures.
Steps 1 to 5 and 8 to 10 act on prices. They slow an increase, reveal a margin, restore a competitor or raise an income against a cost. All are worth doing, and none of them changes what a household needs to spend.
Steps 6 and 7 do. A household that shares a kitchen, a laundry and a workshop, owns its dwelling and leases its land, and grows part of its own food has a structurally lower cost of living — permanently, with no transfer payment, and no dependence on any price staying where it is. Most cost-of-living policy tinkers with prices. Only this changes the bill.
| Current failure | Sovereign Australia fix |
|---|---|
| Relief operates on the published price, so it expires and the price returns. | Act on the cost, not the price. What is reduced stays reduced. |
| Energy rebates hid a 19 per cent rise, then ran out. | The aim is 10c/kWh, legislated, with margins capped and gas reserved. |
| Two chains hold two-thirds of groceries; one company owns most of the milk. | Divestiture powers, a code with criminal penalties, and mandatory live price publication. |
| A viable processing plant can be closed the year after its owner buys the competitor. | Offered for sale at independent valuation before closure is permitted. |
| Between a mortgage and a rental queue there is nothing. | Community Towns and City Communities made legal to build, at around $150 a week. |
| Prices confirmed quarterly, months after they moved. | One million products tracked farm gate to shelf, published in real time. |
| The cash rate is the only instrument in use, and it cannot tell an egg from a rent. | Government acts on the specific input that moved. The Reserve Bank manages the aggregate. |
| Productivity falling, and incomes forecast 20 per cent lower in forty years. | Competition reform worth $2,000–$6,000 per household, permanently. |
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Memo 22 — The Cost Of Living. What has actually happened to prices since 2021, what relief was offered here and overseas and why it expired, and the ten steps that follow. With sources. ~8,750 words, 23 sources.