WA households are feeling the pinch and making cuts – and one sector will face the most pain

A new survey has painted a grim picture for Western Australia’s hospitality sector, with households in a glum mood about the rising cost of living and readying to tighten their belts even before the Reserve Bank hiked up interest rates to a 15-year high on Tuesday.

The Chamber of Commerce and Industry WA released its September Consumer Confidence survey on Sunday, with almost two in five households surveyed reporting that their expenses outpaced their income each month.

Of the 1000 West Australian households surveyed in mid-August, 20 per cent said they had been unable to pay their bills on time, and about half reported they would cut discretionary spending to offset cost-of-living concerns.

CCIWA chief economist Dr Daniel Kiely said the hospitality sector would bear the brunt of those discretionary spending cuts.

“Fifty-eight per cent of those surveyed saying they would cut spending on cafes and restaurants over the next six months, which could have a significant impact on the sector heading into the festive period,” he said.

“Many consumers have told us they also planned to reduce spending on socialising, with 55 per cent saying they’d spend less at bars, pubs and clubs.”

Six in 10 households surveyed reported that interest rates were weighing heavily on their confidence, Kiely said.

Their fears were realised on Tuesday, when the RBA board lifted rates to a 15-year high of 4.6 per cent.

The move meant a household with a mortgage of $600,000 would be paying another $91 a month, bringing the cumulative increase from the four rate hikes in 2026 to $364.

Shadow Treasurer Sandra Brewer said every family across the state had less money than they did five years ago.

Speaking to media on Sunday, Brewer took the opportunity to place at least some of the blame at the feet of the Cook government, saying government expenditure was helping drive up inflation.

The national consumer price index rose from 3.5 per cent in July to 4 per cent in August, which economists have predicted will keep pressure on the Reserve Bank to push rates higher yet again.

Housing costs were the biggest contributor to national annual inflation. The Australian Bureau of Statistics reported the cost of new dwellings rose 5.4 per cent in the 12 months to August.

Meanwhile, high global oil prices and the end of the federal fuel excise cut saw transport costs rise 5.6 per cent, which was the second-biggest contributor to inflation.

“The best thing government can do is to try and bring inflation down, and that’s by reducing demand in the economy,” Brewer said.

“It’s to reduce government spending at a time that the private sector is investing.

“So at the moment, last year we had general government expenditure grow by 11 per cent.

“In the coming year, it’s forecast to grow at over 8 per cent.

“And we wonder why we can’t get on top of inflation. It’s because Treasurer Rita Saffioti simply won’t pull back. It’s within her power to do so, but she can’t, and she won’t.”

Brewer took aim at the government’s “pet projects” – the controversial Burswood racetrack and funding for the Perth Bears NRL team to start up in 2027 among them – and even linked the current inflationary environment to the One Nation byelection shock in Secret Harbour.

“People are angry everywhere,” she said.

“I think the recent election result in Secret Harbour showed it doesn’t matter what the government says and tells them what a great economy we have, when people are $128 a week worse off for every full-time worker, they know what that means for them and their family.”

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