Debated in Parliament on 27 Feb 2018.
Mr Gan Thiam Poh asked the Minister for Trade and Industry (Trade) (a) whether there has been a significant rise in the average cost of living for Singaporeans since 2010 in terms of basic necessities/staple food, transportation, housing and medical care relative to other major cities with and without the same standard of living and full accessibility of goods and services respectively; and (b) how will the Government continue to provide Singaporeans with a higher standard of living and maintaining a lower cost of living.
The Consumer Price Index can be used as a proxy for changes in the cost of living in Singapore. Between 2010 and 2017, the Consumer Price Index (CPI-All Items) inflation rate was 1.8% per annum. However, most of the inflation over this period occurred in the earlier years. Last year, the inflation rate was lower, at 0.6%, following two years of negative inflation.
The Member asked about the inflation experience of other major cities. As most national statistical offices do not publish inflation data at the city level, we will look at the experiences of the three Newly Industrialised Economies (NIEs) of Hong Kong, South Korea and Taiwan instead. Over the period of 2010 to 2017, the inflation rates of South Korea and Taiwan, at 1.8% and 1.0% per annum respectively, were comparable to or lower than Singapore’s. On the other hand, Hong Kong's inflation rate was higher, at 3.6% per annum.
Apart from looking at the cost of living, we should also consider households' income growth which affects their ability to meet these costs. Between 2010 and 2017, resident households’ incomes increased faster than the inflation rate, leading to positive real income growth. For instance, median resident household income from work per member grew by 3.7% per year in real terms, while that for the lower income deciles rose by between 3.6% and 4.0% per annum.
Nonetheless, the Government recognises that cost of living may be of concern for some groups, particularly retirees and lower income households. The Government provides significant support for Singaporeans, such as in pre-school, education, housing, healthcare and public transport, to ensure that these are affordable. Direct social transfers, such as the GST Voucher, Workfare Income Supplement and Silver Support Schemes, provide additional support to the lower income. For needy families who require more support due to their unique circumstances, additional help is available at our Social Service Offices.
The Government will continue to monitor trends in inflation and cost of living closely and provide help to Singaporeans where required. In addition, the Government will continue to ensure that our economy remains competitive and dynamic, so as to provide good job opportunities with sustained income growth for Singaporeans. This will, in turn, help to ensure a higher standard of living for Singaporeans.
PAPERCUTS