The alternative news in 1 day? (part 63) – 387,187 in poverty?

I refer to the article “Median household income rose to $7,870 last year, inequality down” (Straits Times, Feb 18).

Real median household income rose 1.6%

It states that “Median household income rose to $7,870 last year, 4 per cent up from 2012, according to a Department of Statistics release on Tuesday. After accounting for inflation, the rise was 1.6 per cent from 2012.”

According to the Key Household Income Trends 2013 report released today – the Median Household Income from Work Per Household Member only increased in real terms by 1.9% per annum, from 2008 to 2013, lower than the 3.2% per annum from 2003 to 2008.

Income per household member of the 3 lowest deciles?

Average Monthly Household Income from Work Per Household Member Among Resident Employed Households by Deciles – 1st to 10th, 11th to 20th and 21st to 3oth deciles were only $463, $896 and $1,268, respectively last year.

1st to 10th decile only 0.9% p.a. increase?

Change in Average Monthly Household Income from Work Per Household Member Among Resident Employed Households by Deciles – 1st to 10th decile only had a real change of 0.9 and 1.3% per annum, from 2003 to 2008 and 2008 to 2013, respectively.

Including employer CPF contribution?

Since the statistics are based on “Household income from work includes employer CPF contributions” – what are the statistics excluding employer CPF contribution?

In this connection, I understand that prior to the recent years, the previous statistics were focused on income excluding employer CPF contribution.

Take-home pay?

So, assuming a maximum CPF contribution rate of 36%, does it mean that the take home pay for the lowest three deciles may be as low as $319, $618 and $874, respectively.

How to survive on $319?

Aren’t these kind of low, particularly for the 1st to 10th decile at $319? How does one survive on $319 a month?

387,187 people in “poverty”?

Since there are 1,063,700 resident employed households – does it mean that about 106,370 households (1st to 10th decile) or about 387,187 people (106,370 times 3.64 average household size), may be living in “poverty”?

The Annual Household Income from Work Per Household Member was only $8,264 ($689 monthly) or about $475 net take-home pay using the same assumptions above, for HDB 1 & 2-room households.

218,400 in HDB rental flats?

As I understand that there are about 60,000 HDB 1 & 2-room households, interim housing and homeless shelter households – isn’t this quite a lot of people at about 218,400 ( 60,000 times 3.64 average household size), who arguably may be another indicator of those who may be living in “poverty”?

Gini after Govt transfers?

Government transfers and taxes had a redistributive effect on household income. Government transfers and taxes reduced the Gini coefficient in 2013 from 0.463 to 0.412 – even after this reduction, our Gini is still amongst the highest in the world, and about double that of the Nordic countries.

More “Non-working non-retiree” households?

Households with No Working Person increased from 106,00 to 110,800, whilst “retiree’ households increased from 69,400 to 72,100. So, does this mean that the increase in households with no working persons was more than the increase in ”retiree” households?

What does this mean?

Why still use 60 retirement age?

As to “For statistical purposes, retiree households are defined as those comprising solely non-working persons aged 60 years and over” – since the retirement age has been changed t0 62, and the re-employment act extends it to 65, why are we still using age 60?

Does this not possibly and arguably, inflate the number of ‘retiree’ households?

No breakdown into citizens and PRs?

With regard to “Resident households refer to households headed by Singapore Citizens or permanent residents” – why is there no breakdown into Singaporean and PR households?

More downgrading?

Why is it that the percentage of 1 & 2-room, and 3-room flats have increased to 5.0 and 19.0%, respectively?

Also, 4-room flats have stagnated at 32.6 and 5-room and executive flats have decreased to 25.1%.

Is this indicative that more people are downgrading?

Leong Sze Hian

About the Author

Leong Sze Hian has served as the president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), Hotel Mumbai (associate producer), invited to speak more than 200 times in about 40 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of 2 countries. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.