Unite union national secretary Shanna Reeder said many low-income workers and their families were struggling.
“It’s extremely tough ... Even when they’re not on the minimum wage, they’re still behind and it’s really obvious when you get to the checkout,” she told the Herald.
Reeder’s union had members nationwide and she said living costs were especially punishing in places where rents where high, such as Auckland, Queenstown, the Bay of Plenty and Wellington.
“Our Government right now would say they should leave and get another job but that’s pretty hard to do at the moment when you’ve got hundreds of people going for the same job.”
Reeder said ongoing high living costs meant some people were forced to redefine what necessities were and were postponing or cancelling trips to the dentist or optometrist because they could not afford it.
“Something we are noticing is people aren’t able to get just the basic healthcare they need, and I think that applies to middle-income people as well.”
Reeder’s union represented about 3500 fast-food workers and was about to go into bargaining with Restaurant Brands and McDonald’s.
The HLPI measured how inflation affected different household groups, plus an all-households group.
“What we’re seeing across all income groups is living-costs inflation is starting to slow,” Westpac senior economist Satish Ranchhod told the Herald.
But he added: “We’re still seeing pressure on household finances.”
Ranchhod said interest rates had been a major driver of household inflation early last year but the Reserve Bank’s Official Cash Rate announcement on February 19 could deliver some relief.
He expected a 50 basis points cut in the cash rate from 4.25% to 3.75%.
“Compared to two years ago, the average two-year mortgage rate is now about 100 basis points lower.”
For the average household that translated to about $300-$400 a month in savings, he said.
But he said rising insurance costs and council rates could counter some of the deflationary forces in months ahead.
Finance Minister Nicola Willis said the latest data showed the Government deserved credit for reducing average household living cost inflation.
“Today’s statistics release shows Kiwis are still battling with the cost of living, but the pressure is starting to ease,” Willis said in a press release.
“The Government said it would address the cost of living. We are making progress.”
Willis said the coalition made the Reserve Bank’s job easier by “reining in wasteful public spending”.
She added: “We also delivered New Zealanders their first tax relief package in 14 years, and we’re helping low and middle-income families through FamilyBoost.
Quarterly inflation
For the three months to the end of December, average inflation for all households was 0.4%.
For beneficiaries it was 0.6%, for Māori it was 0.5% and for superannuitants it was 0.5%.
For the highest-expenditure household group, inflation was 0.4%. It was 0.6% for the lowest-expenditure household group.
