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Calling Out Older People’s Privilege

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As I watch the South Australian state election campaign unfold, I feel compelled to call out older people’s privilege – that is, the leveraging of public funds based on a false sense of need and/or entitlement. Spoiler alert: my argument is that poverty and need among older people is about class, not age – but more about that later!

Unequal sign, with wording "inequality - not what you think"

Old Does Not Equal Poor

I will look at a few examples of older people’s privilege below, but first, the basic data that might question the allocation of concessions and government support based on age (or even receipt of the age pension), rather than on need. I have previously posted that 72% of age pensioners own their own home, and around two-thirds of those homeowner pensioners have more than $100,000 in additional financial assets. Not rich, but not poor either – and those statistics say nothing of the self-funded retirees who are too rich for the age pension.

Overall, the data is clear that there is a correlation of age and wealth as many people with steady jobs accumulate wealth over a life-time. ACOSS/UNSW research shows that the average older household was 25% wealthier than the average middle-aged household, and almost four times as wealthy as the average young household.

And yet, we have policies and proposals to provide government support for older people or households that are not available to other, poorer households.

To be clear, an age pensioner who is renting a house and has only limited savings is going to be facing serious financial pressures and in need of support. But that poverty is about not having property and capital income, rather than about their age. And even then, that pension income remains significantly above the income-support and concessions provided to unemployed people of working age.

Yet lurking at the back of our minds and at the front of the social security system is a very old idea of the deserving and undeserving poor. Older people are assumed to have worked throughout their life and deserve support in their retirement, while working-age people who are unemployed or experiencing waged poverty are somehow to blame for their poverty.

This may change as compulsory superannuation opens the possibility of age pensioners being seen as undeserving losers who did not work hard enough to provide for themselves in retirement, but fortunately, we are not there (yet). And in the meantime, despite the obnoxiousness of the deserving/undeserving politics, older people’s privilege is alive and well. Here are a few examples that have come across my desk in the last few weeks.

Examples of Older People’s Privilege

Stamp Duty Promises

At this state election, the Liberal party is promising to provide a $15,000 stamp duty discount for over 55’s looking to downsize, while Labor is promising to abolish stamp duty for over 60s downsizing to a new-built dwelling. Ignoring the impact on government revenue and the fact that stamp duty overall is an unfair and inefficient tax, these tax concessions (almost by definition) go to people who can most afford to pay stamp duty – because they are getting a significant cash bonus from their downsizing. Young families going from their first home unit to a suburban house are likely to need stamp duty discounts more than an aging downsizer, but older people’s privilege prioritises the needs of age over financial position (albeit dressed up as a wider market intervention to free up supply).

The Older People’s Privilege Lobby

The election campaign platform of the state’s leading advocate body for older people, COTA (the Council on the Ageing) proposes free ambulance services for full age pensioners. Nobody wants a cost barrier to people calling an ambulance when they need it, but this proposal is a claim to older people’s privilege (mediated slightly by limiting it to full age pensioners). Age pensioners already get a 50% discount on ambulance cover insurance and ambulance fees, while people who are unemployed (with no children) and those in waged poverty receive no such discounts.

While COTA is simply lobbying for its constituency, a better public policy would be free ambulance services for all South Australians (a universal service). Short of that, the priority should surely be to extend the existing concession to all unemployed people and those in waged poverty, not an extension of an existing subsidy to aged pensioners.

Similarly, COTA’s call for the removal of the work limit for Seniors Card eligibility would see an older full-time worker in a well-paid job receive free public transport and other discounts, based simply on their age. [1] No consideration of income or need, just a claim for older people’s privilege.

Disclaimer – I am particularly grumpy here because these proposals undermine work that SACOSS did to remove unfairness and poverty premiums in the state concessions system – work that was adopted by the SA government in the 2024-25 state budget.

Propaganda in Other Interests

The final example is not an election policy, but a recent Renew Economy article expressing outrage at a proposal to charge all customers a fixed network cost, rather than the usage-based charges currently in place. While fixed charges are usually regressive, this is less the case than the current system where those with money and housing tenure can reduce their chargeable usage (e.g. by installing solar panels and batteries) and avoid paying any network costs.

For reasons outlined in previous posts, I question the data behind the article’s assertion that the fixed charge proposal takes from the poor and gives to the rich. However, in the context of this post, what is interesting is that the poster child of this injustice is a:

“pensioner in a small cottage home, who makes sure they wear their winter woollies to keep their heating bill down, and always takes short showers and who used their small surplus cash to buy solar to contain their power bill.”

This consumer here is not described simply as a person who owns their own home and has capital invested in solar panels and batteries, they are a (deserving) age pensioner. Yet the distributional impacts of energy network tariffs are mostly about technology and housing tenure, not age – but the age pensioner makes an appearance nonetheless as older people’s privilege is weaponised.

Class, not Age

The reality of all these examples (and a thousand others) is that those with a need for government support need that support because they lack income and wealth, not because of their age. Of course, some older people have low incomes because they are marginalised in the labour market by age-discrimination, but in terms of government supports, this could be equally or better dealt with by reference to employment status than age. And as the stats at the top of this article suggest, many other older households have comfortable incomes and wealth.

Age is simply not a good determinant of wealth or of need. As Piketty made famous, the fundamental driver of inequality is capital accumulation. This is true in the big picture of Piketty, but also in the modest capital of owning a home (or solar power).

When we invoke older people’s privilege to continue to provide (or lobby for) supports based on age rather than need, we are making poorly targeted policy, masking the fundamental inequality of class processes, and perpetuating an antiquated view of the deserving and undeserving poor.

Let’s talk about class (income and wealth) and need, not age.

[1]              The SA Senior’s card is currently available to all residents over the age of 60 who work less than 20 hours per week. There are no income limits.

Revisiting Issues of Affordability, Income and Inequality

This post updates and collects in one place my previous writings about how policy arguments around inequality which are based solely on income data (e.g. income percentiles) fundamentally misunderstand and misrepresent inequality.

The basic argument is that standard income deciles/percentiles are misleading because they create a picture of a continuous income distribution spectrum, rather than differential flows of income to certain parts of the economy. More specifically, they ignore fundamental differences in income arising from housing tenure/ownership, income and capital gains on wealth, and social transfers in kind.

In short, such analysis reflects a 1980s world – before housing costs ate household budgets and superannuation turned wage earners into stock holders.

Housing

Housing tenure matters because it creates differences in effective household income (i.e. actual purchasing power) and living standards. In an earlier post I compared the effective income of a renter and homeowner with identical annual salaries. The homeowner (without a mortgage) ended up nearly $30,000 a year better off than the renter on the same $100,000 p.a. income. This result was driven by:

  • differences in housing costs (imputing rental income to homeowners for the value of housing services received)
  • income from investing the cash that would otherwise have gone to rents, and
  • tax advantages that go with that investment.

This comparison did not take account of capital gains which could heighten the gap, and the renter/homeowner difference is probably worse now with rent prices going up faster than income (so proportionately higher imputed income for homeowners) and a booming housing market seeing higher capital gains.

This is all pretty obvious, and echoes why poverty studies tend to focus on “after-housing” income. However, it does suggest that plotting an income spectrum just based on cash incomes is very misleading when it comes to understanding difference in purchasing power and standards of living. At a minimum, we need to be basing analysis on the intersection of income and housing tenure.

Wealth

While housing is the primary form of wealth for most Australian households, the issues above are magnified when all forms of wealth are taken into account. Capital gains and tax advantages are increased, while wealth also creates additional ability to invest in money-saving technologies (e.g. energy efficient devices) which in turn increases future purchasing power without a change in income. And there are financial, health and psychological benefits of having savings/wealth to fall back on in emergencies.

But what is important here is that we can’t simply assume that income and wealth go hand-in-hand. The last ABS data (before the national statistician created an inequality data black-hole), shows that just under a third (32%) of low-income households also had low wealth, but 23% had moderate wealth (probably owning their own home), while 11% of low-income households had high wealth (See the graph below).

Column graph showing percent of households in lowest, middle and high income brackets that have low, moderate and high wealth.
Source: ABS, Household Income and Wealth

A concrete example of this wealth-income divergence emerges from the government’s data on age pensioners. The data for the September Quarter 2025 shows that 72% of pensioners own their own home, and around two-thirds of those homeowner pensioners have more than $100,000 in financial assets beyond their home. These pensioners have low-moderate incomes (otherwise they would not be eligible for the pension), but substantial enough capital to be protected against poverty and to have a better standard of living than many renters on higher incomes.

In short, low income does not necessarily mean low wealth or low purchasing power, and an income spectrum based solely on income figures misleads as to who is likely to be struggling.

Social Transfers in Kind

The final piece of the puzzle would be the inclusion of social transfers in kind – that is, the receipt of public services such as education, public health care, child care subsidies as well as a range of rebates and concessions. Many of these transfers go disproportionately to those on lower incomes, which then increases their effective consumption and standard of living. In turn, this decreases inequality – which was the finding of a leading Australian scholar in this field, Yuvisthi Naidoo, whose work I have summarised here.

However, the analysis is more complicated. A very useful recent briefing paper from the e61 Institute shows that while social transfers in kind are generally progressive (i.e. disproportionately benefit those on lowest incomes), there are significant differences between different transfers. The graph below from their report shows the distribution of transfers across both income and wealth quintiles. We can see, for instance, that pharmaceutical concessions are one of the more progressive transfers when plotted against income, with about two-thirds going to those in the lowest two income quintiles. However, those pharmaceutical benefits are far less progressive when plotted by wealth – in part because older people have more needs and eligibility, and are also likely to have accumulated more wealth (mostly in the form of home ownership).

Bar graph showing the percent of each of 15 different government transfers going to each income quintile. Social/public housing is the most progressive, while community health services and private health insurance rebate are the least progressive.
Source: e61 Micronote: Welfare for the Well Off?

It is worth tracking the comparison of progressivity in this graph for each transfer, and there is further discussion below on energy concessions, but the main point here is simply that inequality looks different when wealth and social transfers in kind are considered.

Why Does It Matter?

Overall, all this matters because it means that the level of inequality we see in standard income spectrums may be misleading, but also because actual households will be in different places on the income spectrum when extended incomes are taken into account. Naidoo’s research showed that nearly a half of all older people (65+) were in the lowest standard (money) income quintile, but the inclusion of imputed rent and social transfers in kind reduced that to 22.5% (because older Australians are disproportionately more likely to own homes and benefit from health services). By the time imputed wealth annuities were included in the analysis, only 17% of older people were in the lowest income quintile. At the other end of the spectrum, accounting for extended income meant that 26% of older households were in the highest quintile, up from 7.1% when based on standard income alone. (Naidoo, Appendix Tables C8-11) .

These issues have very direct implications for policy fairness. My attention was recently drawn to this in relation to energy affordability, where there is a legitimate concern to alleviate and avoid energy costs for low-income households. Obviously we don’t want households to go without power, or be bankrupted by power bills, but targeting energy assistance to those on low incomes may be poor targeting. Worse, a focus simply on income might mean imposing more network and other costs on those least able to pay.

Consider the pensioner households noted above. The nearly one-half of age pensioners who own their own home and have more than $100,000 in financial assets can easily afford solar power and energy saving technologies (if they have not got them already). They are far less likely to be facing energy hardship than renters on the age pension without access to the same technologies (who, incidentally, would be seen to have a higher income due to receipt of Commonwealth Rent Assistance). This is important because both pensioner households would receive the same energy concessions (at least in states like SA where the concession is a flat rate) because concession eligibility is based on income rather than ability to pay.

Further, those homeowner pensioners are also far less likely to be in energy hardship than renter families in waged poverty, yet the age pensioner will get an energy concession while those in waged poverty may not qualify. This is a different type of income fetishism (based on income type rather than quantum), but again we see income as an unreliable indicator of affordability and need for support.

More broadly, we can see in the e61 graph above that energy concessions are more progressive by income than by wealth. Nearly half of all concessions go to those in the lowest income quintiles, but only around a quarter go to those in lowest wealth quintile.

There are lots more intricate issues around who bears (and should bear) the necessary costs of the energy transition and how network costs are paid for (apportioned between customers). But what is clear is that a distributional analysis of energy costs based on a simple income spectrum would be misleading in terms of both ability to pay (income) and access to energy-saving technology (cost).

The Way Forward

Energy is just one area where there is a need for a far more sophisticated analysis of income inequality. We need an analysis of affordability for a range of essential expenditures that takes account of housing tenure, but also extended incomes and the real ability to pay for essential consumption.

Ultimately what I would like to see is, firstly, for the ABS to get themselves resourced and organised to do another Household Expenditure Survey (the last one was 2025-16!), and then to be able to analyse those expenditures based on an extended income spectrum combining wealth, housing and income. Only then will we really know which expenditures are genuinely regressive (have disproportionately highest impact on those with the least ability to pay) and where and how to target support.

In the meantime, caution and an analysis based on housing tenure is advised.

Social Services and Energy Distribution: The Treatment of Surpluses and Profits in Pseudo Markets

Arising from neoliberalism’s obsession to not just analyse the world in market terms, but to make the world into a market, governments in Australia and elsewhere have privatised or outsourced a range of services which had previously been provided by government departments or authorities. South Australia followed this ideological venture in a range of areas, but in this post I simply want to focus on two examples: social service provision and the electricity distribution network.

While the two industries are obviously different, in both cases there was an attempt to mimic or impose market discipline where there was no competition and no real market. Social services are a government monopsony where service users are not the customers so the theoretical link between utility, market demand and price is broken, while energy distribution networks are a natural and legislated monopoly.

Much could be written about the structures and regulation of the “markets” that were established, but I want to focus on just one aspect: the inconsistency in the treatment of profit. This treatment has consequences for social service delivery and energy prices, and ultimately therefore, for equality.

Social Services

The provision of social services, such child and family support, financial counselling, community health, housing and homelessness support, addiction help, and disability services are an essential part of a government’s role in a modern society. But the neoliberal vision and the potential to cut costs by outsourcing services to organisations with lower pay or less regulation led to the creation of pseudo-markets where charities and not-for-profit (NFP) organisations (and some private companies) periodically bid for government tenders to provide services. The successful tenderer is then contracted to provide services at the agreed price, with the government apparently happy in the knowledge that the competition between tenders has ensured value for money.

Heading text from SA government contracts for social services. The terms prevent surplus accumulation.

There are some good reasons for government outsourcing of some social services (and much hubris in relation others), but the treatment of the cost of services and profit in the South Australian government contracts is curious. The government holds most of the cards in any contract negotiation, and generally does not allow for an operational surplus in a contract price. Further, given that the government pays for service provision in advance, it wants to ensure that the money is spent on the services it paid for. And so, the standard SA government contract with NFP service providers has a clause (10) allowing the government to require repayment of any advanced funding which has not been expended in a given year. While there is flexibility for the government not to require repayment, some departments aggressively pursue such repayment.

At best this is a lop-sided contract, with one party (the government) agreeing a price for the provision of a service, and then reducing that price if the service provider manages to make savings – even though the service has been provided as agreed. Despite government rhetoric of outcome-based approaches, the clawing back of unexpended funds is completely input-focused.

However, the ramifications are broader because the lack of operational surpluses and the claw-back of funding means that NFPs struggle to find surpluses to build robust balance sheets and invest in organisational sustainability and development. It is then no surprise that the sector is characterised by an under-investment in technology (as reported in multiple annual surveys) and by short-horizons with a reliance on the next government contract to maintain staff and services.

To be clear, the fact that organisations are not-for-profit does not mean that they can’t lawfully or shouldn’t make a surplus on any service or in any year – it simply means that any surplus has to be put back in to the organisation and can’t be allocated to members as a dividend or other profit distribution. However, the contractual limitations on building and keeping such operational surpluses is detrimental to the sustainability of NFPs and stops them providing more and better services to the people who rely on them.

Electricity Distribution

The pseudo-market created in energy distribution is quite different. By contrast to the government monopsony in social services, the energy companies who bought the privatised energy networks operate in a more standard business framework with the cost of services being paid for by energy consumers (accounting for about 40% of energy bills). However, because the networks have monopoly power, their operations are regulated by laws which limit the aggregate revenue they can get from consumers.

As I have noted in a previous post, the calculation of this aggregate is complex and contested, but it is theoretically based on the cost of service provision, including an agreed rate of return on capital (i.e. profit) – with the regulator determining what costs and profit rates are appropriate.

This allowance of a return on capital contrasts to social service provision in that an agreed rate of profit is viewed as a normal cost of service provision – a cost not usually allowed in NFP contracting (noting that, in theory at least, both have separate allowances for administrative overheads). The result of this is that these private companies can accumulate profit to re-invest to build the company and to distribute to shareholders in a way that NFPs can’t.

However, the difference does not stop there. As I have reported previously, the Institute for Energy Economics and Financial Analysis has produced reports highlighting the “supernormal” profits energy distribution companies have made when their actual costs have come in below the costs agreed by the regulator. In 2022, this amounted to $199m for SA Power Networks and around $2bn across all network providers nationally. While the differences in estimated and actual costs may be factored into future regulatory determinations, this money is not immediately clawed back by the regulator or consumer – indeed, there is a whole incentive scheme built in to the cost calculation to encourage such cost-savings.

A Modest Proposal

There is no doubt that NFP service providers would love to be able to keep their operational savings and surpluses to reinvest in their organisation and services, or even to have an incentive system which mirrored that which enables energy networks to benefit from cost savings.

For governments to be consistent, they should either allow NFP service providers to retain profit (i.e. money not spent when they have provided the agreed services) as per the energy regulation, or force energy networks to refund to customers the above-regulated profits when their costs of service provision are lower than the regulated amount. Energy network owners would still be better off than social service NFPs as the former would still get their guaranteed return on capital, but in relation to the unexpected savings and surpluses, it is a simple proposition that what is good for the goose is good for the gander. But such outcomes are about power (of the political economic kind), not policy, and I suspect in this case it is energy consumers who will continue to be plucked.

3G Phones, Energy Smart Meters and the Neoliberal Fantasy

Below is a link to an Opinion piece I ghost wrote and which was published today in Adelaide’s online news site, InDaily. It is a critique of the narrowness of industry initiatives and regulatory responses to the impending closure of the 3G mobile network and the roll out of energy smart meters. The response is based almost exclusively around the need to fully inform consumers, rather addressing the fuller needs of consumers and the consequences for people dealing with the technology changes.

While the piece finishes with some implications for how we provide essential services, in a short piece it was impossible to draw out any broader theoretical concerns. However, in the back of my mind was always a critique of neoliberalism.

It is neoliberal ideology that posits people as consumers, makes essential services into commodities and imagines oligopolies as markets. It was in the neoliberal moment of Australian history that energy and telecommunication networks were privatised, and pseudo markets were constructed with rules that reflected the economic fantasy that if consumers are fully informed they will shop around and that this will deliver optimum outcomes. As the article shows,  we are still paying the price for that delusion.

Read the opinion piece here: https://www.indaily.com.au/opinion/2024/04/17/consumers-bear-the-cost-of-essential-service-changes

Image of InDaily page with Opinion piece "Consumers bear the cost of essential service changes"

Revisiting Energy Supernormal Profits – A Tale of Two Graphs

In a previous post I highlighted the work of Simon Orme and the Institute for Energy Economics and Financial Analysis (IEEFA) exposing the supernormal profits reaped by monopoly energy networks. They define supernormal profits as the actual profits made by these statutory monopolies over and above that which was allowed for under regulation. (Under national energy laws, the Australian Energy Regulator [AER] regulates the total amount of revenue that can be collected by energy transmission and distribution networks to avoid profiteering from their monopoly position).

Supernormal Profits

The context and how supernormal profits are realised is highlighted in the earlier post, which was based on IEEFA’s 2022 report. They have now published a new report which updates and refines the first report and includes figures for the 2022 financial year. The headline finding is that in the last year the energy networks reaped a massive $2bn in supernormal profits (on top of and eclipsing their regulated “allowed” profit of $1.4bn). This was a significant increase on the approximate $800m supernormal profits across the networks in 2021 and brings the total supernormal profits reaped since 2014 to over $11bn. Overall, this added an average of $185 per customer to energy bills in 2022, although there were significant differences between states and network providers.

The industry attacked the report, claiming the IEEFA analysis is flawed because it treats every variation from the AER’s allowance as a potential supernormal profit, and because consumers benefit from the incentive schemes which contribute to the extra profits. Unsurprisingly, I disagree with the industry critique, but I also have a different approach to that of the IEEFA.

As per my previous post, I think this work on supernormal profits is really important. It is a welcome focus on and quantification of profit-levels, particularly when the issue of profit-taking is largely ignored in energy debates dominated by prices, reliability and emissions. However, I also suggested that, despite the industry reaction, the IEEFA approach is fairly conservative – a critique (deliberately) from within the regulated monopoly framework which utilises a neoclassical concept of profit that is limited and problematic.

Two Graphs – Two Theories of Normal Profit[i]

This neoclassical conception of profit as a normal and unobjectionable cost of production (and hence the target of attack being “supernormal” profits) is clearly evident in the graph below from the 2023 IEEFA report.

Figure 6 from IEEFA report showing FY22 network cost and profit outcomes, on two lines: 1. Revenue = $8.7bn cost + $1.4bn profit + $2bn supernormal profit. 2. Cost = $8.7bn cost base + $1.4bn profit

The second line of the graph clearly includes the normal profit allowed by the regulator as a standard part of the cost. Indeed, the fact that they use the same cost base for both actual revenue and allowed costs is a nod to what it theoretically should cost in a properly regulated (perfect?) market.

The detail of the report goes further in allowing up to a 30% increment on allowed profits before the supernormal profits are viewed as “excessive”. This is to allow for the asymmetry of information (where the regulator has less information on network costs than the network businesses). In this context, I pity the poor consumer advocates in underfunded NGOs being asked to comment on billions of dollars of expenditure and financial engineering! The concern around lack of information reflects traditional economic literature on imperfect markets, a concept which not only implies and centres a “perfect market”, but also adopts the orthodox economic interpretation of profit as a cost of production. Indeed, the distinction drawn between normal and supernormal profits inevitably normalises a certain level of profit as a return on capital.

However, it is possible to draw the graph differently using the same IEEFA data, but with a different theoretical starting point.

Alternative model of the IEEFA data on network costs and profits, showing two lines of the same length: 1. Allowed = $10.7bn costs + $1.4bn normal profits 2. Actual = $8.7bn costs + $3.4bn profits.

This graph more clearly shows that in both the projected (allowed) and actual cases, the customers are paying the same ($12.1bn), and that $3.4bn of that is going in profits to the network owners. I argue that this is a better reflection of the dynamics at play because the goal of any capitalist enterprise is to maximise profit. With total revenue set, the only way to grow or maximise profit is to cut costs – which is clearly shown in the second line of my graph. In this sense, IEEFA’s “supernormal profits” are simply the outcome of normal business operation.

Side note: given this normal business operation, there appears little justification for the additional funding provided to network providers under efficiency incentive schemes. Those schemes cost rather than benefit consumers, and are unnecessary when the networks already have normal business incentives to improve efficiency/cut costs. I note that the IEEFA report (pg 26) comes to the same conclusion, despite the differences in our theoretical frameworks.

Conclusions

Again, there are caveats to the above discussion (see endnote), but the differences in the two graphs reflect not just different theories of profit, but different purposes and outcomes.

The IEEFA analysis is an argument for better regulation, so the analysis of supernormal profits in the first graph shows a revenue-take and profit above a theoretical optimum cost-base that would apply if regulation had been better.

By contrast, my graph, based on the same data, draws attention to the overall cost to consumers of the privatisation (or corporatisation) of these natural monopolies. In this context, I note that some energy networks remain in public hands, but the regulation and mode of operation of such government businesses is the same – with the important distinction that what energy consumers pay in profits to state enterprises has benefits in lower taxes or better public services. This is not the case for private companies. But either way, the quantum impact is clear: this network model added $3.4bn in total to energy consumers’ bills in 2022.

Economic orthodoxy and business interest would suggest that this cost to consumers would be more than balanced by the greater efficiencies of capitalist production which result in lower prices in the long term. However, this is ideology rather than analysis. The data shows that very little of the increased profit is driven by improved technology and processes.

According to AER data, in 2022 capital structures and cost of debt were the two biggest contributors to cost savings, while the IEEFA report (pg 26) explicitly rejects the idea that increased productivity is the source of supernormal profits. It points out that networks with average and even below-average productivity have still been getting very substantial supernormal profits.

Given this, and the $3.4bn cost last year for the privilege of privatised/corporatised energy network provision, I again wonder if it is time to think about whether there are better ways to supply energy.

Endnote

[i]              The depiction in the graphs is obviously over-simplified. In reality, the picture of energy profits is more complicated than either of the graphs above. The total revenue figure is more flexible than shown as projections for allowed revenue will inevitably be imprecise even if all assumptions are correct, and the amount of revenue allowed to be collected each year is varied by the regulator to take account of some financial changes (e.g. interest rates and inflation), allowed cost pass-throughs and other factors. Allowed revenue is also reset every 5 years, based in part on previous outcomes.

Further, as the IEEFA report (Appendix 1) notes, there are limitations on the AER’s published data, and definitive profitability data for each of the 18 network providers is not publicly available. Partly this is because these regulated networks often operate as part of larger financial entities with regulated and unregulated revenues and expenditures. In this context, I am grateful to IEEFA for piecing together the available data and providing both data and analysis that is accessible and understandable by “energy outsiders” like me.