New research into Australian spending habits reveals that households that spend more on alcohol showed a higher probability to report experiencing financial hardship.
The study entitled “How is alcohol expenditure distributed in Australia“, funded by the Foundation for Alcohol Research and Education (FARE) and undertaken by the Centre for Alcohol Policy Research (CAPR), is the first of its kind in Australia, using Australian Bureau of Statistics Household Expenditure Survey data to examine alcohol purchasing in relation to demographic factors, income, living situation and reports of financial difficulties.
The study found that Australian households spent an average of $32.20 each week on alcohol, which is more than tobacco ($12.50), personal care ($24) and education ($30.60).
Alcohol purchasing patterns appear to contribute to financial distress. The study shows households that spent a greater proportion of their budget on alcohol are 1.3 to 1.7 times more likely to experience financial difficulties compared to those that do not buy alcohol.
Households who were renting or headed by young people aged 18-24 spent significantly more of their income on alcohol and were more likely to report financial problems.
CAPR lead researcher Dr Jason Jiang says these findings show the impact of spending on alcohol on Australian households.
Better understanding the relationship between what Australians are spending on alcohol and their personal and financial situation provides valuable insights to inform both alcohol and financial policies and programs.
Alcohol has a substitutive effect, where it replaces essential goods and services like utilities, food, clothes, footwear and health services. So a reduction in alcohol spending in a household may save money for necessities and improve living standards.
The study also found that Australians spent more and bought more alcohol at bottle shops than at clubs and bars. Of those who purchased alcohol, households spent on average $26 each week at packaged liquor outlets compared to $15 a week at bars, clubs and restaurants.
FARE Chief Executive Michael Thorn agrees that a decrease in the alcohol spending in a household would effectively help to reduce some financial distress.
It’s very clear the alcohol industry deliberately targets the most vulnerable in our community which is why you will find a greater concentration of off-licence outlets in lower socio-economic areas. Policies that prevent the opening of bottle shops on every street corner in these neighbourhoods would have a direct impact on household alcohol expenditure, and help reduce financial hardship for many Australian households.
