Further Measures to Moderate Rise in Consumer Price Index

Mr Gan Thiam Poh asked the Minister for Trade and Industry what are the further measures that the Government can consider to control or moderate the Consumer Price Index (CPI) after having taken into consideration the main components causing the rise in the CPI in the last two years.

Sir, over the last two years, CPI-All Items inflation in Singapore rose from 2.3% in 2021 to 5.5% year-on-year in March 2023. The increase in prices was mainly driven by the higher costs of private transport and food.

The Government has introduced comprehensive measures to help Singaporeans cope with inflation. First, through support programmes, such as: one, the latest tranche of CDC Vouchers in January; two, the Cost of Living Special Payment next month; three, the enhanced GST Voucher (GSTV) – Cash payment in August; and four, the Assurance Package Cash towards the end of the year.

On average, for lower-income households, the enhanced GSTV scheme and Assurance Package will fully cover the increases in spending due to inflation and the GST rate increase this year. For middle-income households, the measures will substantially cover the increases in spending.

Second, the Monetary Authority of Singapore (MAS)'s five monetary policy tightening moves since October 2021 have led to an appreciation of the Singapore dollar and helped temper imported cost increases, including for food. As I highlighted to the House in February this year, the effects of MAS' past tightening moves are expected to continue to dampen inflation over the course of the year.

Third, while private transport costs have risen, the Government has ensured that public transport remains affordable. Every public transport journey is subsidised by the Government. In fact, the Minister for Transport added that more than $1 for every public transport journey, subsidised.

In addition, one in two Singaporeans, including seniors and lower-wage workers, benefit from concessionary fares which are up to 70% less than adult fares. But I would like to assure the Member that the Government will continue to monitor consumer goods' price developments closely and be prepared to do more if necessary.