Federal government acts to rein in chronically high cost of living in remote Indigenous communities

Imagine feeling like a sweet treat, but a packet of chocolate biscuits costs $11.70.

Maybe a stir-fry for dinner? The sauce costs more than $10, triple what it would at a suburban supermarket.

On the way home you need to refuel, but the bowser is showing an eye-watering $3.75 a litre – twice as much as what it costs in the nearest city.

It's the daily reality for thousands of Australians living in remote towns, amid growing evidence that cost-of-living increases are hitting regional communities hardest.

While limited, government data suggests the growth in living costs in remote communities is outpacing the rest of the country, impacting some of the most disadvantaged people in the country.

"We are very remote and costs have definitely spiked," explains Madeline Gallagher-Dann, CEO of the Kalumburu community on the northern tip of Western Australia.

"Our barge service costs around $25,000 a fortnight to get the food sent from Darwin, so it's not a surprise, but it's definitely a burden for local families."

Now, the government says it is developing a plan to tackle the inequity and bring down prices – but will it work?

Australia's most expensive town?

The northern WA community of Kalumburu is an extreme example of the ballooning costs in outback Australia.

A comparison with metropolitan costs shows locals are paying twice as much for fuel and some basic food items.

For example, a tin of baked beans costs $5.80, compared with the current online price of $2.80 at Coles and Woolworths.

Beef mince sells for $20 a kilo, double the going rate at a regular supermarket.

Gaambera and Walbi elder Dorothy Djanghara says families regularly run out of money to buy food.

"Everything costs more here," she says.

"Even things like sugar, milk, tea – when you run out, you run out, just can't afford more that week."

The high costs are unsurprising given Kalumburu's remote location. Road access is cut off for about half the year due to wet season road damage. 

At many remote stores, unhealthy and packaged food costs more than fresh food, as managers – in this case the company Outback Stores – deliberately subsidise the cost of fruit and vegetables.

The majority of the 400 residents are on small, fixed incomes. There are limited job opportunities, although some families benefit from royalty payments linked to native title commercial agreements.

But the stress of covering costs adds to tensions in a community already struggling to stabilise after decades of dislocation and dependency on the Catholic mission, which was established in 1908 and still manages the fuel supply to the isolated township.

Sharing a washing machine

Dorothy Djanghara says families are having to share white goods because they can't afford to replace them when they break down.

"The washing machines cost so much, so people have to borrow other people's to wash their clothes," she says.

"That's what I'm doing at the moment, my sister is letting me use her machine.

"It's not good – you need clean clothes especially for the babies and young kids."

Previous government inquiries have concluded the inflated prices are not due to price gouging, but linked to transportation costs, limited storage facilities, and minimal wholesale purchase power compared with major supermarket chains.

Gap between city and remote prices gradually increasing 

The latest government data shows the scale of the gap between urban and remote living costs in Australia.

There is currently no national price monitoring system, despite it being a recommendation of the 2020 parliamentary inquiry into remote food security. 

The most detailed snapshot is produced every two years by the Northern Territory government. 

Its latest report, released this week, reveals a basket of healthy food costs 40 per cent more in remote stores than in suburban supermarkets.

Most disturbingly, the report's 10-year snapshot shows the gulf has been gradually widening, despite multiple government inquiries.

Between 2000 and 2019, the cost of the grocery basket rose 3.1 per cent annually in remote stores in the Northern Territory, outpacing the consumer price index increase of 2.7 per cent.

By comparison, the surveys found the shopping basket cost in urban areas increased by 2.1 per cent.

The good news is the difference has reduced slightly in recent years, since peaking in 2017 when an average shopping basket cost 60 per cent more in remote stores.

Fuel costs have also risen disproportionately in some regional areas, with the ACCC's monitoring program showing the biggest differences between metro and regional prices are in northern Australia.

For example, in the Northern Territory fuel costs an average of 15 cents more in regional areas than in the nearest city of Darwin, with the gulf increasing by a third during 2023.

Government reveals plans for change

The Albanese government has revealed it is developing a national strategy to address the issue.

"The strategy aims to address food insecurity and high costs in remote communities," a statement from the National Indigenous Australians Agency says.

"Consultations are about to commence and will include regional forums, discussions in remote communities and feedback via online submissions.

"The final strategy is expected early 2025."

Online submissions have opened, and more than 30 public forums and community visits are scheduled in June and July.

The catalyst was the 2020 federal parliamentary inquiry that confirmed the remote food supply was fragile, expensive, and affecting health and wellbeing.

It made 16 recommendations, including the creation of a real-time, public price monitoring system for all remote community stores, improved road and shipping infrastructure, and wholesale distribution centres to allow bulk purchasing.

It is not yet known whether these will be adopted as part of the strategy, but those who have seen a draft document are hopeful it will bring tangible change.

Julie Brimblecombe is a dietician from the Department of Nutrition, Dietetics and Food, Faculty of Medicine, Nursing and Health at Monash University, and has spent three decades researching and advocating for remote food supply.

"This is not a new issue. The cost of food is twice what it is in urban settings, and people know it's impacting health and wellbeing," she says.

"And it’s not just food, it’s the cost of electricity, and fuel and transport."

Ms Brimblecombe says there seems to be real momentum for change, especially since food security was added to the Closing the Gap targets in 2021.

"With this strategy, it feels like food security for remote communities is being placed high on the agenda," she says.

"The public consultation offers a real opportunity to make sure it's relevant and meaningful, but we need to make sure the government commits funding and we then keep them accountable for the goals that are proposed.

The idea of subsiding particular food products or freight has been discussed at multiple government inquiries.

In recent years the federal government has focused on one-off grants to improve capacity, allocating $8 million in grants to 22 remote community stores to install and expand refrigeration, solar power and storage.

'No humbug'

The struggle to make ends meet is fuelling so-called "humbug", which involves pestering friends and family to share what they have.

Kalumburu CEO Madeline Gallagher-Dann says it's based on a traditionally communal approach to resources, but can become toxic.

"You see humbug every day – you could say it's like a type of peer pressure," she explains.

"We have signs up at the store now saying 'No humbug' because it can make it hard for people."

Dorothy Djanghara says she is happy to help her extended family where she can, but it can create tension.

"My family do come and ask to borrow money and food, and I end up cooking for them when they have nothing – I support them," she said.

"I try to help them but sometimes enough is enough – I don't know if I can say this, but sometimes they're spending their money on playing cards too."