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Lowest income had highest inflation & lowest pay rise?

By Leong Sze Hian

I refer to the article “Singapore’s inflation up 4.1% on-year in H2” (Channel NewsAsia, Feb 5).

Lowest income had highest inflation?

It states that “the CPI (for all items) for the lowest 20 per cent, middle 60 per cent and highest 20 per cent income groups increased by 4.8 per cent, 4.2 per cent and 3.8 per cent respectively in the second half of 2012.

The CPI (for all items) for the lowest 20 per cent, middle 60 per cent and highest 20 per cent income groups increased by 5.6 per cent, 4.7 per cent and 4.2 per cent respectively for the whole of 2012.”

So, the lowest income group had the highest inflation.

Lowest income had lowest inflation?

As to “The lower income group experienced a smaller increase in CPI compared to the middle and higher income groups.

CPI (excluding imputed rentals on owner occupied accommodation) increase for the lowest 20 per cent income group was 2.8 per cent.

CPI (OOA) – Uniquely Singapore?

This is lower than the middle 60 per cent income group which rose 3.2 per cent, and the highest 20 per cent income earners which grew at 3.6 per cent”, are there any countries in the world that has an alternate measure – CPI (excluding imputed rentals on owner occupied accommodation), to show that the lowest-income have a lower CPI than the higher-income?

Since the three sub-groups of the Housing component in the CPI are Accomodation, Fuel & utilities and Household durables, aren’t the lowest income more adversely affected by rising housing related expenses like Service and Conservancy Charges (S & CC), property tax, repairs and maintenance, etc?

Incomes at bottom continue to rise?

In this connection, the article “Incomes at bottom continue to rise, says Chan Chun Sing” (Straits Times, Feb 5) said that “Acting Mnister for Social and Family Development Chan Chun Sing gave figures to show that incomes at the bottom continue to rise, in response to Nominated MP Tan Su Shan’s question on social mobility.

The real median gross monthly income for employed residents increased 1.3 per cent a year from 2002 to 2012, after rising 2.7 per cent a year from 1996 to 2002, Mr Chan said.

For the lowest 20th percentile of employed residents, their real gross monthly income rose 0.1 per cent each year from 2002 to 2012, and 2.2 per cent a year from 1996 to 2002.”

So, the real wage increase for say a lower-income worker who earned $1,000 has increased to $1,010, in the last decade. This $10 increase in10 years is “(gave) figures to show that incomes at the bottom continue to rise!

If you are a lower-income worker, after reading the above two news reports on your arguable lower inflation and income “continue to rise” – How would you feel?


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