What cost of living pressures mean for families and schools

Cost of living

Amid rising inflation and interest rates, families across Australia are facing growing pressures on their household budgets. As they adapt to increases in the cost of living, it will have implications for how much families can spend on education, with impacts to the school finances and enrolments.

Inflation at the highest rate in over 20 years

According to the latest data from the Australian Bureau of Statistics, inflation has reached 5.1% largely driven by essential non-discretionary items. These are goods and services such as food, housing, healthcare, transport and education.

Inflation
Source: Australian Bureau of Statistics, Consumer Price Index, Australia March 2022

Out of the everyday items, transport has surged to 13.7% due to rising petrol prices which is expected to have flow-on effects on logistics and supply chains that will further drive up the cost of goods and services. Housing and education were also two of the largest increases and have been trending up over the past year.

annual-inflation-of-essentials

Source: Australian Bureau of Statistics, Consumer Price Index, Australia March 2022

quarterly-inflation-of-essentials

Source: Australian Bureau of Statistics, Consumer Price Index, Australia March 2022

Impact to families and school fees

As education and housing are two of the largest household expenses, the continual increase in the cost of living and interest rate hikes will have significant impacts on families whose household budgets have already been hit by the disruptions of the past 2 years.

In response to these pressures, many families will be forced to make significant changes to their spending and review their children’s schooling arrangements. This might result in having to switch their kids to a cheaper school if they can’t fit school fees within their budget.

What this mean for schools

As families review schooling arrangements for their children, this poses a risk to enrolments and school finances. This might also result in the need to provide more bursaries and fee concessions while also having to manage the higher cost of running a school and investing in additional resources due to the pandemic.

During this period, the need to provide parents with the flexibility to align school fee payments with their budget is more important than ever. We’ve been working with our partner schools to improve their finances by ensuring they receive upfront payments from Edstart, while providing flexibility to families so that we’re able to minimise disruption to students’ education and help reduce the risk of schools losing enrolments.

About Edstart
Edstart is a leading technology and financial services company providing funding and payment services for education. We offer fee management solutions to schools and flexible payment plans to parents to help make school fees easier to manage.

To see how we can help you, visit our main website.

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