Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Hansard source

The answer to the honourable senator's question is as follows:

The Australian Bureau of Statistics (ABS) has advised that "purchasing power" is the ability of households to acquire goods and services. There are two main determinants of the purchasing power of a household:

The CPI measures price change facing households. Indexing the income of the household by the CPI allows the household to maintain its acquisition of goods and services at the same level over time.