Celebrating real income increase?

August 10, 2014

We refer to the article “Income gap down, but transport remains a concern: MOF review” (Channel NewsAsia, Aug 8)

Real income increased 6% last 5 years?

It states that “Last year, lower-income Singaporean workers at the 20th percentile earned S$1,800 per month, up 6 per cent since 2009, after taking inflation into account. Median monthly income was S$3,480, an increase of 9 per cent over the same period. ”

Income including employer CPF contribution?

We understand that the income statistics cited are including employer CPF contribution.

Only 1.2% increase per annum?

Also, does it mean that the annual growth in income was only 1.2 and 1.7 per cent for the 20th percentile and median, respectively?

Does it mean that for example, a lower income worker earning $1,000 only had an average annual real increase in income of only about $12?

And for a worker earning $2,000, the annual real increase was only about $34?

Excluding employer CPF contribution?

What are the figures, excluding employer CPF contribution? Even lower than 1.2 and 1.7 per cent?

With the rising cost of living beyond the official inflation statistics which may be relatively higher for the lower-income, particularly in healthcare, HDB, food and beverage, etc – some lower and middle income households may be struggling to make ends meet.

30% spend more than income?

In this connection, a recent study by local university professors found that 30 per cent of households were spending more than what they earn.

Considering the stark statistics on income growth – how can our 150th press freedom ranking media report income growth arguably as a positive statistic as we celebrate our 49th national day?

Employer CPF is not disposable income?

Are there any countries in the world that include employers’ pension contributions (like our employer CPF contribution) in calculating income growth?

The reason we believe no country does that, may be because CPF contribution increases have been to the specific and Medisave accounts – which is not disposable income.

S Y Lee and Leong Sze Hian

P.S. Come with your family and friends to the 3rd Return Our CPF protest on 23 August 4 pm at Speakers’ Corner https://www.facebook.com/events/648543138548193/?ref=2&ref_dashboard_filter=upcoming

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About the Author

Leong
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.