Australians face $2,000 cost-of-living surge from April 1

Households across Australia are bracing for a sharp rise in living costs from April 1, 2023. A mix of higher health insurance, surging fuel prices and the end of energy rebates will push expenses up by hundreds—or even thousands—of dollars a year. Many are already struggling, with nearly four in ten relying on credit to cover basic bills.

The financial squeeze begins with health insurance premiums, set to climb by an average of 4.41% on April 1. At the same time, the annual $450 government energy rebate will disappear, leaving bills unrebated for the first time since its introduction. These changes coincide with the Reserve Bank's latest interest rate hike, adding roughly $1,440 a year to the average mortgage.

Fuel costs are also surging due to disruptions in the Middle East. The closure of the Strait of Hormuz has pushed 91 octane petrol to between $2.40 and $2.50 per litre, while diesel nears $3.00. Earlier data showed prices in Perth averaging $1.62 per litre for 91 octane and $1.87 for diesel, but the recent spike has made filling up far more expensive.

For mortgage-paying households, the combined impact could exceed $2,000 in extra annual costs. Many are already under pressure, with 38% of Australians reporting they are financially worse off than a year ago. A further 43% now depend on credit to pay everyday expenses.

There are ways to cut costs. Switching electricity providers in states like South Australia, New South Wales and Victoria could save hundreds a year. Reviewing health insurance policies may also trim between $100 and $200 from annual bills.

The April 1 changes will hit budgets hard, with higher premiums, unrebated energy bills and rising fuel costs all taking effect. While shopping around for better deals may ease some pressure, the overall increase in expenses will leave many households facing tough financial choices in the months ahead.