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Pub Date: Oct 15, 1993
SPEECH OF THE DAY
We highlight the speech by Mr Kenneth Chen (Hong Kah GRC) for bringing a fresh
insight into the debate on the cost of living.
LET me join in to thank the minister and his committee for putting up a most
comprehensive report which I am sure the whole Singapore will be richer by
...
But there is one point, a minor but important point, which in my opinion
has been omitted. I am referring to the four root causes of inflation
identified in the report, i.e., scarce resources, timing of fee increases,
reduction in subsidy rate and the "expectations" factor.
I would like to add one more cause - the spending habit of the average
Singaporean.
In a buoyant economy like ours, it is understandable that we become very
free with our money. This has caused us to have a mindset that we do not have
to be thrifty, that we have plenty of options and choices.
This has resulted in us developing a very unhealthy spending habit. To put
it simply, we have become very wasteful.
In order to limit the ever increasing cost of living, we must change this
mindset and develop in ourselves a certain constraint in our spending habits.
The old virtue of being thrifty should always be maintained.
Let me give a few illustrations.
Let us assume that all of us decide not to upgrade to bigger flats or to
private housing unless it is absolutely necessary, and that our children,
even if they are married, stay with us in the same dwelling.
I am sure property prices would immediately stabilise, not to mention the
savings on household expenditure. You only have one TV, one fridge, one PUB
bill to pay.
Even in cars and the COE. Let's say till next month, there will be only
one quarter of the cars being tendered out of the total available numbers.
Immediately, car prices will be reduced by $20-$30,000.
I wonder how many house wives nowadays take the trouble to look for the
cheapest price of an item before buying it? We have gotten into the habit of
paying for convenience. We would not want to walk 100 metres even though we
know we can purchase the same item cheaper ...
We often assume that more expensive items are better. Therefore we give in
to our children's requests to buy Nike shoes.
Whatever happened to the old Bata shoes? Are they really that different in
terms of quality? Perhaps the only difference may be that for every pair of
Nike shoes we buy we will make Michael Jordan richer.
Does one go around a hawker centre? A bowl of prawn noodles can cost
between $1 something and $4 or $5. The fact that some hawkers can charge
$4-$5 for a bowl of prawn noodles is because some of us are willing to pay
the price ...
To a great extent, the rate of increase of cost of living depends very
much on ourselves.
We must develop the philosophy of appreciating the value of money and
guard against unnecessary waste ...
If one wishes, the dollar can actually go a long way, if only we try to
stretch it.
Therefore, whatever we decide on the ways and means to address the high
increase in cost of living ... ultimately it is not the developer, the
supermarket owner or the restaurant owner who will dictate what we have to
spend.
It is our own decision. And if we are careful and calculative in spending
our money, it will go a long way to containing the cost of living.
Lastly, I would like to appeal to the opposition members, especially the
three SDP members, not to be obsessed with criticising the Government or
echoing mindlessly the misconception of some of our people ...
They should concentrate on spreading the message on the importance of good
finance planning ... This issue is of utmost importance to the future of
Singapore and should be above party politics.
Reports by Ng Wei Joo, Ahmad Osman, Chiang Yin Pheng, Chua Mui Hoong, Cherian
George, Chung Tsung Mien and Leong Chan Teik.
THE People's Action Party must fight the perception that the overall cost of
living has gone up when it is only the cost of a few "emotive" items that has
increased, said Mr Lim Boon Heng.
"We have to put this debate on cost of living in its proper perspective
because in the last two years, the PAP Government has been sold short," he
told PAP cadres at their Nov 15 conference. v
"We have allowed increases in a few emotive items to create this whole
perception of high costs. It is time that we, as a party, fight back."v
The party must temper expectations and ensure that wages continue to rise
faster than inflation.
"For that, we need to focus our attention on the big picture, to make sure
Singapore remains competitive."
Mr Lim, Senior Minister of State (Trade and Industry) and chairman of the
Cost Review Committee, noted that despite low inflation, many people perceive
that the cost of living has gone up because of price rises of some items.
The changing lifestyle of Singaporeans, who now travel more and own more
consumer durables, also leads to this perception.
He added: "This is not to say that people in the lower-income group do not
have problems making ends meet.
"The Government is merely saying that inflation has not been alarming, and
affected the lower-income less."
In his speech, an excerpt of which was published in the latest issue of
the PAP organ, Petir, Mr Lim touched on the cost of the following items which
has led to the perception of increased living costs.
* HOUSING - Higher prices increase the value of home owners' assets, but
people feel the pinch when they "chase the ever bigger dreams to own bigger
homes".
* HOSPITAL FEES - People want treatment in higher-class, dearer wards, but
the Government cannot freeze hospital charges because wages, which make up
most of a hospital's running costs, cannot be capped.
* EDUCATION - Parents did not spend as much on this before, but now they
have to educate their children to a higher level.
* CAR PRICES - The number of cars has to be restricted if Singapore's
roads are to remain congestion-free.
"We can improve our road systems and charge on usage to increase car
ownership, but we will not be able to satisfy everyone," he said.
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