Crackdown ordered on food label loopholes

Supermarkets must stop suggesting cheaper foreign meat comes from Britain

By Martin Hickman, Consumer Affairs Correspondent
Friday, 30 January 2009

Supermarkets have been told by ministers to stop selling processed food containing cheaper foreign meat with labels suggesting it is British. The Environment Secretary, Hilary Benn, said retailers were undermining the Government's drive to persuade shoppers to buy British and putting at risk the Government's policies on food security and animal welfare.

A labelling loophole allows grocery chains to mark products as "Produced in the UK" if the last significant change to it took place in Britain, even if the main ingredient comes from abroad.

As such, they can legally label chicken sandwiches as "Produced in the UK", even if the chicken has come from intensive poultry sheds in Thailand, because they have placed the chicken between bread and, similarly, sell ready meals containing cheap foreign pork.

In a selection of "Produced in the UK" goods on sale yesterday, Tesco was selling chicken sandwiches with imported poultry, Somerfield "Wiltshire cured bacon" from Denmark, and Asda Cornish pasties with beef from Ireland.

In an interview with The Independent, Mr Benn said that Britain was lobbying for new European laws that would outlaw the practice – which he described as "hard to justify".

At a meeting at Department for Environment, Food and Rural Affairs (Defra) last week, he and the Farming minister Jane Kennedy urged stores to stamp out misleading labelling before the new legislation comes into force in several years.

Tesco and Sainsbury failed to turn up to the meeting, which was attended by Asda, Morrisons, Waitrose, Marks & Spencer and the British Retail Consortium, which represents all big stores.

Mr Benn suggested to the Food and Drink Federation this week that manufacturers should state the percentage of British ingredients in ready meals, pies and other products.

He told The Independent that labelling of fresh meat was generally good but he suggested some products were giving a false impression to consumers.

He said: "If you buy something that has on the package 'Wiltshire cured bacon', I think most people would assume the bacon came from Wiltshire, but under the current European rules that is not necessarily the case. You may turn it over and discover that actually it came from Denmark. Or if you buy, for example, Cumberland sausage you might assume that that is where the pork came from, but then you discover it's not from there – it's from somewhere else.

"So, we are pressing strongly in Europe... because consumers are not getting clear information. "

"We know a great deal about the origin of our car or the house we buy," he added. "I think we should have better information about where our food comes from."

Farmers' representatives welcomed the minister's "excellent" contribution, which it hoped would raise pressure on the stores to increase their backing for Britain's 152,000 farmers. Helen Ferrier, chief scientific adviser for the National Farmers' Union, said: "If people do want to buy British, we want them to be able to go into a shop and easily find those products – and at the moment they can't. The extra element of advantage our members might have over Dutch or Brazilian producers is not there."

Supermarkets defended their labelling, saying that they could not always source British meat or were supplying "value" products that consumers would not expect to have come from within the UK.

Tesco said: "'Produced in the UK'... will be in small writing on the back of pack and is intended only to indicate where the food has been produced. It is not used in a way that suggests any of the ingredients are British and is not used to market the food as a 'British' product."

Somerfield said of its Wiltshire cured bacon: "The suggestion that customers automatically think the pigs are reared in Wiltshire is questionable. But we will revisit how we label country of origin in that product."

Confusion about country of origin labelling was raised by the TV chef Jamie Oliver last night in his show, Jamie Saves Our Bacon, in which he criticised grocery stores for their labelling of pork.

Setting out the Government's stance, Mr Benn said that he wanted to ensure the UK had a thriving farming sector at a time when the rapidly rising global population might reduce the willingness of other countries to export food to the United Kingdom.

He has been working on improving labelling for a month, having warned that government policy could only be allowed to take place if shoppers were informed of the origin of their food.

"I think the public and I have the opportunity to raise that and change it because it is clearly wrong that something should be labelled in a way that makes people believe that the meat product came from somewhere it didn't come from.

"It seems to me that is wrong. It needs to change," Mr Benn said.

Take shorter showers, eat less meat: Singapore’s mantra to fight slump

Bloomberg
17 Jan 2009

Until a few months ago, Amit Singh dreamed of buying a car. Now, with S$75,000 ($50,100) in the bank, the lawyer is holding back, saying he’ll continue to make the one-hour commute to work on the Singapore subway.

“In these bad times, the buzzword is save, not spend,” says Singh, 34. “It’s not the right economic climate to be lavish or to have a luxurious lifestyle.”

Singapore is asking its citizens, the world’s third- wealthiest adjusted for purchasing power, to be prudent as analysts predict the worst economic slump in the nation’s 43- year history. In speeches, pamphlets and ads, the government is advising people to switch to cheaper frozen meats, take shorter showers and skip the top-of-the-line mobile phone.

The island’s strategy contrasts with that of other countries such as Japan and Taiwan, which are trying to boost consumer spending to spur economic growth as exports falter. Singapore, whose 4.8 million population is one of Asia’s smallest, doesn’t have a big enough home market to make up for falling sales overseas, so officials “are not even going to try” to tell people to spend more, says Vishnu Varathan, an economist at Forecast Singapore Pte.

“There’s no way the domestic economy can make up for the slack in the external sector,” he says. The message “is to bear with pay cuts and live frugally.”

The government is preparing people for dwindling incomes as the nation’s fourth recession in a decade forces companies including lender DBS Group Holdings Ltd., manufacturer Stats Chippac Ltd. and state-owned investment company Temasek Holdings Pte. to fire workers or trim salaries.

Singapore last year unveiled more than S$5.4 billion in cash payouts, utility rebates and special funds, or S$1,700 for each of the nation’s 3.2 million citizens, to help the poor cope with rising food and energy prices.

Officials say people also need to help themselves during the economic crisis. If everyone depends on the government, “we’ll weaken ourselves as a society,” Prime Minister Lee Hsien Loong said on Jan. 11, according to the island’s main English newspaper, the Straits Times. “We’ll cultivate a sense of reliance.”

The World Bank predicts Singapore’s $161 billion economy will be East Asia’s worst performer this year. The government forecasts it may shrink as much as 2%, after expanding 1.5% in 2008 and 7.7% in 2007.

Kit Wei Zheng, an economist at Citigroup Inc. in Singapore, says the contraction might be as much as 2.8%—the most severe since Singapore gained independence in 1965.

The unemployment rate may more than double to 5% from 2.2% in September 2008, says Leong Wai Ho, a regional economist at Barclays Capital in Singapore. More than 30,000 jobs may be lost, he says, after about 400,000 new positions were created in the past two years.

That could boost the default rate on mortgages for government-built apartments, which house 84% of Singaporeans. The rate has risen to 8% from 5% in 2003.

Governments elsewhere in Asia are encouraging their more- sizeable populations to spend to counter the deepening global recession. Taiwan extended the New Year’s holiday an extra day and is scheduled to distribute NT$3,600 ($108) shopping vouchers to citizens on Jan. 18. Japanese Prime Minister Taro Aso has pledged to give households 2 trillion yen ($23 billion) in handouts.

That may not work for Singapore, where private consumption accounted for 38 percent of gross domestic product in 2006, compared with more than half in Australia, Hong Kong, South Korea and Japan, according to the World Bank.

Singapore’s leaders have traditionally preached restraint amid economic difficulties. In 2001, when the economy contracted 2.2%, the government refused to cap electricity prices and instead gave utility rebates to help the poor and encourage people to “save and not over-consume,” then-Prime Minister Goh Chok Tong said in an August 2001 speech.

The government’s latest campaign began last year when prices of food essentials including rice and cooking oil surged. As inflation soared to a 26-year high of 7.5%, Prime Minister Lee urged people to switch to frozen meats and in-house brands of supermarket products, which are typically cheaper.

Singapore to toughen protest laws ahead of APEC meet

17 Jan 2009
Reuters

SINGAPORE (Reuters) - Singapore will toughen its protest laws ahead of this year's Asia-Pacific Economic Cooperation (APEC) summit to reduce the number of civil disobedience acts, state media reported on Saturday.

Wong Kan Seng, Singapore's interior minister, told the pro-government Straits Times newspaper the city-state will look to enact regulations in the coming months giving police greater power to prevent protesters from gathering.

Singapore will host an APEC ministerial meeting in July and the annual summit in mid-November.

It hopes to avoid a controversy like the one in 2006 when an opposition politician was prevented from holding a march during the World Bank and International Monetary Fund meetings, resulting in a long standoff with police and criticism from the meeting organisers.

APEC's 21 members include the United States, China and Japan.

"For cause-related or ideologically-related activities, including those pertaining to race and religion, we should address them squarely as higher risk," Wong told the newspaper.

"We must empower the police to deal with public-order problems more effectively, especially when mega-events are held," he said.

Protests in tightly-controlled Singapore were only made legal last year in a designated zone, "Speakers' Corner", modelled after the one in London's Hyde park.

Any public gathering of five or more people is illegal in Singapore without a police permit.

Singapore defends the need for tough protest laws, citing concerns over public safety and order. But several international human right groups such as Amnesty International have said Singapore uses these laws to stifle dissent.

No maggots in oranges

Jan 6, 2009
By JUDITH TAN (Straits Times)

AN E-MAIL warning Singaporeans that mandarin oranges from China should be avoided as they contain maggots is creating a stir among netizens.

But a Straits Times check showed that it stretches the truth.

According to the Agri-Food & Veterinary Authority (AVA), oranges from only one plantation in China are affected by an outbreak of fruit fly maggots - and Singapore does not import oranges from there.

The AVA said the problem was isolated to a plantation in Wangcang county in Sichuan province.

Singapore's sources of Chinese mandarin oranges are Guangdong, Fujian and Shantou provinces.

The viral e-mail has been making the rounds of inboxes in Singapore over the past week. Pictures of maggots in the oranges were tacked along with the e-mail, which warned that although the infected oranges looked normal, they had maggots inside.

'These worms are very similar in texture to the pulp and, therefore, can be observed only if you look at them carefully. A long-sighted person may not notice them,' it said.

Wildlife Reserves S'pore optimistic about visitor numbers in 2009

By Hoe Yeen Nie, Channel NewsAsia
07 January 2009

SINGAPORE: Tourist arrivals to Singapore may have been hit by the global economic downturn, but the company that oversees three local tourist attractions – Singapore Zoo, Night Safari and Jurong BirdPark – is not too worried.

Wildlife Reserves Singapore is banking on new attractions, such as the Bird Discovery Centre that is due to open later this month, to bring in the crowds.

At the discovery centre, visitors can learn why birds need feathers and find out how they reproduce.

The BirdPark spent about S$5 million last year on its exhibits, including giving its waterfall aviary an African theme, complete with 1,500 birds from 80 African species.

Despite fewer tourists in Singapore in the last quarter, Wildlife Reserves said visitor numbers to its three parks last year remained steady at 3.6 million.

Fanny Lai, group CEO, Wildlife Reserves Singapore, said: "We are optimistic that in 2009 we will be able to serve this number of visitors by getting more local visitors from schools, families, as well as attracting tourists from different segments – primarily from Indonesia and Malaysia."

REACH website hit 1.5 million page views in 2008

07 January 2009 (CNA)

SINGAPORE: Singapore government's feedback-gathering website hit 1.5 million page views in 2008. There was also a 30 per cent increase in number of postings to 12,000 on the REACH discussion forum in 2008.

Speaking at an appreciation lunch for REACH contributors on Wednesday, REACH chairman Amy Khor, who is also Senior Parliamentary Secretary for Environment and Water Resources, named and thanked a few active participants who sent in feedback, even from overseas.

She said that all the views sent in have been channelled to relevant agencies and the process has led to several policy changes.

Some of the hot-button topics were the Marriage and Parenthood Package, and means testing in public hospitals. Government policies on these issues have been reshaped by feedback sent to REACH.

Five new feedback facilitators have also been appointed at the appreciation lunch. They will work towards engaging heartlanders, not just through online and digital means, but also with face-to-face dialogues.

A new website that is aptly dubbed "Youth Vibes" was also launched to encourage greater youth participation in shaping policies.

Soh Yi Da, a REACH contributor, said: "I think the cost of transport takes up a significant portion of my monthly allowance and I believe it's the same for many other Singaporeans.

"If the government can do something about it – come up with some subsidies and stop increasing fares, it could help many Singaporeans tide over this recent economic downturn."

Dr Khor said: "Even if you come with feedback that may not be what the government might want to hear, we still want to hear them because this valuable feedback will help us refine policies."

Passenger numbers drop for taxis, but rise for MRT trains

By Valarie Tan, Channel NewsAsia
07 January 2009

SINGAPORE: People in Singapore seem to be choosing cheaper ways to travel in these tough economic times. Latest figures from the Land Transport Authority showed that taxis are picking up fewer passengers while MRT trains are carrying more.

Passenger numbers for taxis started falling from September when news of a recession first broke. October saw the biggest fall by over 50,000 passengers.

December figures are not available yet, but November statistics showed that business picked up slightly with 898,975 passengers. But the number pales in comparison to that of 2007, when taxi ridership hit 941,709.

Still, SMRT Taxis said the increase could be due to the school holidays and the festive period.

Drivers said that overall, business took a turn for the worse, dropping by about 20 per cent in the last four months.

Said one cabbie: "In one day, I could earn 80 to 90 dollars. Sometimes, I could even earn 110 dollars. But now I can only earn about 50 to 60 dollars."

Most cabbies Channel NewsAsia spoke to are not very positive about business even during the upcoming Lunar New Year season when many families are expected to be out and about.

Drivers said they hope companies can consider lowering taxi rentals and bring down operation costs to help them tide over the difficult period.

Both ComfortDelGro and SMRT Taxis said drivers' income have not dipped for September and October 2008.

SMRT Taxis said records from previous years showed that taxi ridership generally increase in the December and January periods.

While taxis may find the road ahead challenging, MRT train rides got more crowded since September, with passenger numbers surging by about 10 per cent this year compared to last year. - CNA/vm

Tax waiver extended to enhance Singapore port's attractiveness

By Desmond Wong, Channel NewsAsia
08 January 2009

SINGAPORE: The government is extending a waiver on tax for the purchase of Singapore-flagged vessels.

The waiver of withholding tax on overseas interest payments to finance the vessel purchase will be extended for another five years.

Previously, the waiver applied only if two ships were purchased. But now, a single vessel of 40,000 net tons or more will qualify for the waiver.

The waiver extension is aimed at increasing Singapore's attractiveness as a base for ship owners.

This and other measures were announced by Transport Minister Raymond Lim at a cocktail reception organised by the Singapore Maritime Foundation on Thursday.

Industry players welcomed the tax waiver extension, saying it will make Singapore a popular choice for ship owners once the global economy recovers.

S S Teo, chairman of Singapore Maritime Foundation, said: "Things are difficult and ship financing is not so easy to find, but eventually, ship financing will come back, and trade will resume. It's good that we announce such a scheme so that when shipping eventually recovers, we can capture the opportunities."

Singapore, one of the busiest ports in the region, has also reported an 11.1 per cent improvement in shipping tonnage to a record 1.6 billion gross tons in 2008.

The transport minister said this reflects the long-term strength of the fundamentals in the maritime industry.

"The long-term fundamentals of the maritime industry remain strong. There is no substitute for shipping as more than 90 per cent of world trade is transported by sea. Once the global economy improves, we can expect the maritime sector to resume its steady growth," he said.

And it looks like it is still full steam ahead for Singapore's maritime industry, with a slew of activities like the Singapore Maritime Week lined up for the year ahead.

- CNA/ir

Slowing global demand, excess capacity hit dry bulk shipping firms

By Desmond Wong, Channel NewsAsia
09 January 2009

SINGAPORE : Slowing global demand and overcapacity are sinking dry bulk shipping firms, with several seeking bankruptcy protection in the past three months.

Experts expect this trend to continue into 2009 as major economies like China slow consumption and financing becomes harder to secure in the industry.

The key Baltic Dry Bulk shipping index has dropped 92 per cent in the past year alone.

Falling demand for trade and difficulty in obtaining financing have led to an increase in the number of dry bulk ship operators and owners seeking bankruptcy protection.

Hiring rates have also plunged, with vessels which could have been hired out for US$200,000 a day in the past now going for between US$2,000 and US$9,000 a day.

And flagging demand is not the only stumbling block the industry is facing. An oversupply of ships in the dry bulk sector have kept rates down, and this could worsen next year.

Divay Goel, director, Drewry Maritime Services, said: "We would expect that even if demand were to pick up to historical levels which we saw in 2006 and 2007, we have a huge order book overhang in 2009 and 2010."

With the sector facing increasing financial difficulties, cancellations of ship orders and scrappings of half built vessels have increased.

While bad for shipbuilders, this could help the dry bulk sector in general to recover more quickly by trimming the number of excess vessels.

Christopher A Jones, director, Sale & Purchase, Island Shipbrokers, said: "With scrapping increasing and with cancellations in the new building order book, we expect that we will reach a more balanced fleet sooner than we expected."

Market watchers said the current correction is expected to bring dry bulk rates back to levels seen in 2004 before the boom seen in the past three years.

At that time, Cape-sized vessels were going for between US$60,000 and US$70,000 per day. - CNA/ms

Survey shows Singaporeans stepping back from personal luxuries

By Zhang Tingjun, Channel NewsAsia
09 January 2009

SINGAPORE: A survey by OCBC Bank has shown that Singaporeans are starting to step back from personal luxuries and ambitions.

Instead, they are now more concerned about the basics of home, relationship and family.

The survey of 400 Singaporeans aged between 18 and 64 was conducted in the fourth quarter of last year.

It found that travel has dropped from Singaporeans' top priority last year to sixth position now.

Four in 10 respondents said they would cut down on spending.

According to the survey, there are clear indications that luxuries and non-appreciating assets have now taken a back seat.

- CNA/ir

CHEMICAL IN BABY BOTTLES - Is AVA up to date?

Jan 10, 2009 (Straits Times Forum)
Letter from Sai Siew Min (Ms)

I REFER to the stance taken by the Agri-Food and Veterinary Authority (AVA) reflected in its replies in the past two years on the safety of milk bottles and other polycarbonate plastic products used by infants, babies and children.

At issue here is the presence of Bisphenol-A (BPA), a chemical widely used in polycarbonate products that poses substantial health risks to foetuses, babies and children.

I am concerned that AVA's replies, as well as its official website, do not provide updated and sufficient information to Singapore parents on the gravity and complexity of this issue.

Last year, the Canadian government banned the use of BPA in baby milk bottles.

Only recently, an advisory board set up by the United States Food and Drug Administration (FDA) itself took the agency to task for ignoring a significant body of scientific literature on the negative health effects of BPA, in particular low-dosage exposure.

According to a New York Times article on Dec 24, the FDA's current position on the safety levels of BPA exposure in food-packaging materials is based on research funded by the American Plastics Council.

The AVA letters cite reports from 2006, whereas the health risks of BPA to children are an evolving issue and the subject of much public debate, especially in North America.

As a young mother-to-be, I am naturally surprised that this issue has not been highlighted to the public.

The AVA website does not offer useful and updated information. An advisory on BPA posted on the website contains a short and vague four-point statement cautioning parents not to subject plastic milk bottles to high heat because high heat is known to cause BPA to leach from the bottles.

If the AVA is concerned about BPA leaching under high heat, does that mean it agrees that the chemical is harmful to babies?

The advisory also notes that 'baby bottles can be sterilised according to instructions on infant formula label and should be allowed to cool before placing infant formula into them'.

One of the most popular methods of sterilising milk bottles is by boiling them. In parentcraft classes conducted by experienced nurses in local hospitals, new parents are told to boil the bottles for at least 10 to 15 minutes.

What will this do to the stability of the chemical BPA in the bottles? Are the bottles safe for use at room temperature after intense and daily boiling for a long period? Is there a proven and scientific basis for AVA's advisory?

Can the AVA provide further clarification?

PSA records rise in container volumes for 2008

12 January 2009 (CNA)

SINGAPORE: Singapore port operator PSA International on Monday reported handling record container volumes in 2008 despite the global economic crisis, but warned that this year was likely to be tough.

PSA said container volumes handled by its global terminals last year rose 7.3 per cent to 63.2 million twenty-foot equivalent units (TEUs), from the record of 58.9 million set in 2007.

Eddie Teh, group chief executive officer of PSA International, said: "2008 started strongly amidst the gathering storm clouds over the financial services industry and the major economies.

"By the end of the year, though, any lingering confidence that the major economic powerhouses would be able to stay out of a recession had been dashed and global trade worldwide had slowed to a crawl.

"Unless global economies are able to recover in the course of 2009 with the help of huge amounts of proposed spending by governments around the world, our industry will likely experience an extremely difficult year."

Teh said in a statement the port operator was preparing for the tougher months ahead, but gave no further details.

PSA International is owned by investment firm Temasek Holdings. It is one of the world's leading port operators with facilities in 16 countries across Asia, Europe and the Americas, with a total capacity of 111 million TEUs.


- AFP/so

Rescued dugong at Underwater World celebrates 12th birthday

By Imelda Saad, Channel NewsAsia
13 January 2009

SINGAPORE: Twelve years after Gracie the sea cow was rescued off the shores of Singapore, she is now thriving at Underwater World Sentosa (UWS) and ushering in the new Chinese Zodiac Year of the Ox.

For the first time, visitors will be able to interact with Gracie in a meet-and-greet session to celebrate her birthday and the Lunar New Year.

The series of month-long activities include cake parties and dive sessions with Gracie.

Gracie was found in 1998 beside her drowned mother and was relocated to Underwater World Sentosa with the approval of Singapore authorities.

The sea cow, also known as the dugong, is a highly-endangered species similar in shape and size to the dolphin.

Strictly herbivorous, dugongs forage along coastal waters of the tropical Indo-Pacific region and feed by grazing on the beds of sea grass.

Dr Jeffrey Mahon, curatorial director, UWS, said: "Dugongs are a highly endangered species and instances of successful rehabilitation of orphaned dugongs are pretty rare worldwide.

"We are one of a handful of aquariums in the world to showcase a dugong and we worked really hard over the years to make sure Gracie is healthy and feels at home here. We want to share that joy with everyone on her birthday." - CNA/vm

Fujitsu opens S$15m Green Data Centre in Singapore

By Rachel Kelly, Channel NewsAsia
13 January 2009

SINGAPORE: The Japanese electronics company Fujitsu has invested S$15 million into its third data centre in Singapore.

The centre will provide energy efficient data services throughout ASEAN.

The facility, in Changi in eastern Singapore, currently spans over 7,400 square feet. But it has the potential to expand to some 18,000 square feet by the end of the year.

Fujitsu will be using energy efficient initiatives such as temperature control and ambient lighting to save energy and cut energy costs by 10 to 30 per cent.

The data centre is expected to create around 150 jobs this year. - CNA/vm

Asian economies expected to grow 5.5% in 2009

By Ng Baoying, Channel NewsAsia
13 January 2009 1927 hrs

SINGAPORE: Asian economies, excluding Japan, are expected to grow a weighted 5.5 per cent this year – down from the 7 per cent growth seen in 2008.

HSBC said this slide will be led by Hong Kong, Korea, Taiwan and Singapore, while countries like China and India will be the main supports of growth.

Falling demand from most developed nations in the wake of the global downturn has hit economic growth in Asia. But observers said domestic factors are also contributing to the slowdown.

Robert Prior-Wandesforde, senior Asian economist, HSBC, said: "The other factor is domestic demand, in particular consumer spending and investment. Actually, the domestic demand in Singapore and rest of Asia slowed before exports. Over here, initially at least, it was due to the huge commodity price shock that we had a few months ago."

HSBC said it sees little upside in the near future, but it is taking comfort in the massively synchronised and powerful fiscal and monetary policies Asian economies are adopting, and also in falling commodity prices which are seeing the largest declines in 50 years.

Of all Asian countries, Singapore's open, export-dependent economy is expected to fare the worst. But it is also expected to bounce back the fastest and strongest.

"After a fall of nearly 3 per cent on average this year, I think that GDP could rise more than 5 per cent in 2010. That's the kind of recoveries Singapore often gets. Sharp downturns followed by sharp upturns," said Mr Prior-Wandesforde.

Speaking at a media conference on the bank's outlook for Asia on Tuesday, he said he expects Singapore's economy to bottom out in the first quarter, with a GDP contraction of 7 per cent on-year – the largest since the mid-1970s.

Overall, he expects Singapore to round up the year with a 2.8 per cent contraction.

FairPrice extends discounts

Jan 14, 2009
By Jessica Lim (Straits Times)

NTUC FairPrice will keep its markdowns on hundreds of items till December, and double the number of budget buys on its shelves by March.

This is the longest extension on discounts since they were started in December 2007 to bring relief to shoppers from the soaring food prices then.

Yesterday, FairPrice also had relief for more than 6,000 staff members.

No one will be retrenched this year.

Instead, 500 more employees will be hired to fill the ranks at three new supermarkets to open this year in undisclosed locations.

It will also put 5,000 front-line employees through customer service training programmes at a cost of half a million dollars.

Not forgotten were some 100 small and medium-sized suppliers, who can expect payments twice as quickly this year from the supermarket giant.

Add to this increased funding to its trade union parent and more money from its charitable foundation to the community, and FairPrice is looking at commitments of $15 million this year, said chairman Ng Ser Miang.

In its stores, consumers will find reductions on 500 house brand items.

Soon they will have more of even cheaper goods to choose from, as the supermarket's buyers scour the world for 100 more items to expand its lowest- priced range.

These include Aro Soya Bean Oil at $2.95 a litre, and Care Goat's Milk Whitening Shower Cream at $2.95 for 1.2l.

This range of the supermarket's most affordable goods - named the yellow dot range for its distinguishing sticker on the shelf display price - will be extended to include other frequently used essentials.

They have been met by 'overwhelming response', said its director of integrated purchasing Tng Ah Yiam.

He noted that sales of Aro Soya Bean Oil have tripled since October last year when the range was launched, and that of Goat's Milk Whitening Shower Cream have doubled.

'This is an indication that during the downturn, people are looking for cheaper alternatives. We want to cater to this sector of the population,' he added.

The cooperative is also helping its smaller suppliers by cutting payment times from 60 to 30 days to ease cash flow and reduce dependence on loans.

Said Mr Ng: 'The crisis became bad in the last few months of last year, and discussions with suppliers started in September. We could see problems building up for them so we decided to come up with a way to help them.'

FairPrice will also increase its funding to NTUC, amounting to more than the $4.3 million last year, by at least half. Most of it will be used to help low-wage workers.

The FairPrice Foundation, the chain's new charity arm, will contribute at least 20 per cent more to the community this year. It gave $6.7 million last year.

In the meantime, consumers are looking forward to a wider range of budget items.

'This is great. It means I am not limited to just a few budget items when I want to save money,' said Mrs Stella Lim, 47, a mother of three.

Consumers have three tiers of lower-priced items to choose from.

First, 400 national brands - belonging to the Everyday Low Priced range - that are sold at the same price or lower than other retailers.

Second, 500 house brand products - including staples like bread, rice and cooking oil - tagged at 10 to 15 per cent lower than national brand equivalents.

Third, yellow dot items, which are about 25 per cent cheaper than national brands.

Ms Louisa Chua, 41, who now buys the cheapest brand of floor cleaner, is happy for the help.

She said: 'For some items, like floor cleaner, it does not matter if you buy the cheapest type. If I see a lower- priced version, I will buy it instead.'

FairPrice extends ahelping hand
January 14, 2009
Loh Chee Kong (TODAY)
cheekong@mediacorp.com.sg

A TOUGH year lies ahead but the island’s largest supermarket chain is bringing some cheer not just to budget-conscious shoppers but also for the first time, suppliers who are equally short on cash.

Yesterday, NTUC FairPrice announced a broad range of initiatives — which will cost $15 million — to “help Singapore ride through this recession”, in the words of FairPrice chairman Ng Ser Miang.

Said Mr Ng: “2009 will be a challenging year ... Amid this challenging landscape, NTUC FairPrice as a social enterprise is all the more committed to doing more.”

Apart from pledging $8 million to the community through the FairPrice Foundation, the measures include expanding its three-month-old programme to bring in and help customers identify the cheapest products in its supermarkets.

Such items, which are between 20 and 25 per cent cheaper than rival brands, will be tagged with bright yellow stickers. Their number will also be doubledto 200 by the end of March.

FairPrice is also extending its 5-per-cent discount scheme on 500 selected housebrands, initially due to end in March, until the end of the year.

As for its 100 or so suppliers, they can look forward to an assistance programme in which the supermarket chain will pay these small and medium enterprises (SMEs) earlier, reduce the listing and advertising fees it charges them and help to promote made-in-Singapore products.

Mr Ng said suppliers will also be paid much faster — with the waiting time for payment cut by about half. Currently, FairPrice has between 60 and 75 days — depending on agreed trading terms — to pay itssuppliers.

“We know that in various crises, the most critical part is really cashflow,” said Mr Ng, adding that the programme will cost FairPrice some $2 million in terms of the opportunity cost based on a monthly interest rate of between 1 and 2 per cent.

Suppliers and distributors — especially the smaller ones — are naturally pleased, given the economic slowdown made worse by a general shortage of credit in the global marketplace.

“With less business, cashflow would naturally be a problem,” said one distributor.

Noting that FairPrice has always paid up promptly,Mr Kenneth Goh, the purchasing manager of food importer Goh Joon Hin, said while the situation is not dire, “early payments are always welcomed”.

A representative from a fast-moving consumer goods distributor told Today that it received its payment early from FairPrice last month.

He added: “We thought it was a one-off ... the fact that they will be paying us early for the year ahead is good news. Ours is a business based on cash and everyone is experiencing a tighter cashflow.”

When contacted, other supermarket chains said they have no plans to follow FairPrice’s move to ease suppliers’ cashflow worries. But a Sheng Siong spokesperson reiterated that it is constantly on the look out for opportunities to lower the prices of its products to benefit customers.

Mr Ng added that in spite of the economic gloom, FairPrice, which has some 6,000 employees on its payroll, will continue its expansion plans this year by opening three new outlets and hiring another 500 staff.

Promising not to retrench any staff for the next two years, Mr Ng said the supermarket chain will also be doing some astute shopping of its own — in terms of looking out for new management staff.

“We will also take advantage of the downturn to look out for new talent for succession planning,” said Mr Ng.

CapitaLand lowers electricity and water consumption, saves some S$1.5m

By May Wong, Channel NewsAsia
14 January 2009

SINGAPORE : Real estate giant CapitaLand saved some S$1.5 million last year by reducing its electricity and water consumption.

The green efforts were carried out across 23 properties such as its retail malls and office buildings.

The amount of electricity saved can power about 13,000 five-room HDB flats for one month, while the amount of water saved can fill 24 Olympic-sized swimming pools.

Last year, CapitaLand achieved its target of lowering its utilities consumption by two per cent compared to 2007.

This year, the company wants to reduce the use of water and electricity in about 150 local and overseas properties by three per cent.

That will help save up to S$4 million in utility costs. - CNA/ms

AVA says dried white fungus sold in S'pore safe for consumption

By Imelda Saad, Channel NewsAsia
15 January 2009

SINGAPORE: Singapore's Agri-Food and Veterinary Authority said on Thursday that all the samples of dried white fungus sold in Singapore have been tested and are deemed safe to eat.

It was responding to queries from Channel NewsAsia following media reports that six kinds of dried snow fungus sold in Taiwan were found to contain pesticide residue.

The China Post said Taiwan's Consumer Foundation recently completed random tests on dried foods sold for the Lunar New Year festival - such as red dates and snow fungus - at Chinese herbal medicine stores, hyper marts and supermarkets.

The examination results showed all six kinds of dried snow fungus contained one to four kinds of pesticide, including Methamidophos, Fenpropathrin, Acephate and Perethrin.

Nature Society of Singapore adopts Kranji Reservoir

By Esther Ng, TODAY
16 January 2009

SINGAPORE: First it was Chek Jawa, then Pulau Semakau - now soon, another strip of nature little known to Singaporeans, the Kranji Bund Marshes, will be made more accessible to the public.

The Nature Society of Singapore (NSS) adopted the Kranji Reservoir and the surrounding marshes in November, under the PUB's waterways adoption programme.

The wetlands are the island's last remaining chunk of freshwater marshes, and are home to threatened bird species. Measuring 90 hectares, the Kranji marshes have fallen victim to neglect, urbanisation and poachers over the years.

Now, the NSS hopes to get Singaporeans to treasure the area's rich biodiversity, and is launching its first tour for the public on January 31. The three-hour tour will be held every last Saturday of the month, and will involve a 4-kilometre trek.

The society will conduct a survey of the plant and wildlife in the marshlands. It also plans to rehabilitate an overgrown pond located at the end of Neo Tiew Lane 2.

Said the chairman of the conservation committee, Dr Ho Hua Chew: "The pond is clogged with aquatic vegetation. It's conducive for some birds, like the Purple Swamphen, but not others.

"By removing some of the vegetation and opening up the water surface, we hope to attract the pond's original inhabitants - the Lesser Whistling Duck and the Common Moorhen - and other species of birds and dragonflies to forage or visit here."

Much of the wildlife has been threatened by poaching, which seems to have increased in recent years. "We've encountered illegal angling. We've found monitor lizards, terrapins, the Baya Weavers caught in traps and nets. We try to educate these poachers when we meet them," said Dr Ho.

As there are not enough perching areas for birds, the NSS is considering placing a platform in the middle of the pond or on the shore of the reservoir. Once this is done, the public can expect to see Ospreys, Kingfishers and Perns on these perches.

The management of a nature reserve marks a first in the NSS' 54-year history. "As a non-profit organisation, we are constrained by resources and our focus has been mainly on... conservation studies," said Dr Ho.

"However, the PUB has given us this opportunity to go 'hands-on' for the conservation of biodiversity and we've secured some funding from Bloomberg to help us carry out this project."

The PUB's adoption programme, which aims to transform our waterways and reservoirs into community and recreational spaces, enjoys wide patronage.

Senoko Power, Dunman High School and Waterways Watch Society are some groups that organise clean-ups and educational programmes.

To sign up for the Kranji Bund Marshes tour, email contact@nss.org.sg. - TODAY/fa

New Moon premium abalone broth recalled

By Imelda Saad, Channel NewsAsia
16 January 2009

SINGAPORE: The importer of New Moon Brand Premium Abalone Broth Concentrated (400g can) is recalling the product off Singapore shelves.

The company, Goh Joo Hin, is doing that as a precautionary measure following feedback that the product has a bad smell after the can is opened.

Singapore's Agri-Food and Veterinary Authority (AVA) says it is investigating the cause of the problem.

It advises consumers who have bought the product not to consume it.

The abalone broth concentrate is a product of Thailand.

Singapore firms invest nearly S$1b in Iskandar Malaysia project

By S Ramesh, Channel NewsAsia
17 January 2009

SINGAPORE: Singapore-Malaysia ties will remain positive under Malaysia's next premier Najib Tun Razak – that is the view of Malaysia's new High Commissioner to Singapore, Hussin Nayan, who has described current ties as excellent.

An important sign is the nearly S$1 billion (RM2.5 billion) worth of projects that Singapore companies have invested in the mega Iskandar Malaysia project in Johor.

Mr Hussin said: "Najib is not unfamiliar with Singapore leaders. He knows most of the Cabinet ministers in Singapore. I could assume that whatever changes that will take place would be gradual in nature and very smooth.

"I would imagine that Malaysian leaders would continue to improve relations with Singapore because Singapore is a very important country for us."

That is why Mr Hussin feels it is important not to be distracted by the occasional hiccups.

"Ups and downs will always be there, just like a family. It depends on how best we resolve these issues. From my own perspective, the best way to resolve all these ups and downs is through common sense and willingness, goodwill and open-mindedness, rather than harping on the negatives all the time.

"If we harp on the negatives, we will never improve and this has not happened in Singapore-Malaysia relations because leaders from both sides are positive," he added.

Since the Iskandar Malaysia project kicked off in 2005, Singapore companies have been involved in some 220 projects there. But Mr Hussin wants to encourage them to venture to other development programmes in Malaysia.

"I would encourage Singaporeans to go beyond Iskandar Malaysia. As you know, there are other regional development programmes that are being implemented in other stages. We do not doubt that Singapore investors would come in because Malaysia is not a new area for them," Mr Hussin said.

He also assures Singapore businessmen a friendly experience when discussing investment proposals with their Malaysian counterparts.

Peanut butter products in Singapore not from suspected tainted US plant

By Hoe Yeen Nie, Channel NewsAsia
18 January 2009 1908 hrs

SINGAPORE: The Agri-Food and Veterinary Authority of Singapore (AVA) has said Singapore does not import any peanut butter products from the US processing facility suspected of salmonella contamination.

AVA also said it would have more checks on food items from the US containing peanut butter.

The company at the centre of the case is the Peanut Corporation of America, which manufactures peanut butter for private label food companies.

On Tuesday, it issued a recall of the product made at its Blakely, Georgia plant.

Six people are suspected to have died from salmonella poisoning in the US, after consuming products containing peanut butter.

As of Friday, 474 people across 43 states in the US have been reportedly affected by the outbreak. The very young and the elderly are among those most ill.

The AVA has advised consumers to discard the affected products if they had been bought outside of Singapore.

- CNA/ir

S'pore role in UAE eco-city?

Jan 19, 2009
By Jessica Cheam, in Abu Dhabi (Straits Times)
ABU DHABI: Singapore's expertise in water technology and energy could give local companies a head start for contracts to help build an ambitious eco-city in the United Arab Emirates (UAE).

Talks are already under way for Singapore firms to participate in the futuristic project - known as the Masdar Initiative - which is estimated to cost an astonishing US$22billion (S$33billion).

Some of the expertise that local firms, including those in the Keppel Group, have accumulated from their involvement in a similar project - the China-Singapore Tianjin Eco-city - should also stand them in good stead for the UAE development.

Mr Khaled Awad, director of property development for Masdar, an Abu Dhabi energy company, told The Straits Times yesterday that the firm held talks with national water agency PUB and Singapore Power recently.

Mr Awad also indicated that the Masdar City team will meet executives involved in the Tianjin project next month to explore further areas of cooperation.

Tianjin, a project across 30sqkm, broke ground last year and is said to involve at least $5.8billion worth of investment.

For the full story, read Tuesday's edition of The Straits Times.

Singapore seen unveiling anti-recession budget

20 January 2009 0948 hrs (CNA)

SINGAPORE: Singapore's budget to be unveiled on Thursday should contain tax cuts and a hefty financial package to help the country weather what could be its worst recession since independence, analysts said.

As the open, trade-driven economy takes a sharp turn for the worse, the spectre of rising bankruptcies and mass layoffs is striking fear in a country long used to near-full employment and bustling economic activity.

"The Singapore economy is probably headed for its deepest recession since independence" in 1965, said Citigroup economist Kit Wei Zheng.

Officials might even take the unprecedented step of dipping into the country's multi-billion-dollar national savings, Senior Minister Goh Chok Tong was quoted as saying on Monday.

The government is announcing its budget one month early, underscoring the need to react quickly.

Prime Minister Lee Hsien Loong warned at the weekend that forecasts for the economy to contract by as much as two per cent this year would be further scaled down.

Many analysts believe the economy could shrink by three per cent, while some said the contraction could be even more severe. That would leave the economy in its worse shape ever, after 2001 when growth fell by 2.4 per cent.

The city-state became the first Asian economy to enter recession last year after problems in the US subprime, or higher-risk, mortgage sector developed into the worst global economic crisis since the Great Depression of the 1930s.

"The weather is so bad and we've always said the reserves are for a rainy day," Goh was quoted as saying in The Straits Times. "If this is not a rainy day, I don't know what is a rainy day," he said.

Experts, business executives and trade unionists have said they want an aggressive budget to cushion the impact of a worsening economic situation.

Loans to small businesses have tightened, and companies have laid off workers or slashed wages.

Macquarie Research said that, in addition to cost-cutting measures, it expects the budget "to include sizeable infrastructure spending and transfer payments to middle/lower income Singaporeans". It also expects the budget to include incentives for new growth industries and programmes aimed at upgrading workers' skills.

During previous economic crises the government responded with financial muscle. In the 1985 economic downturn, it unveiled about 2.5 billion dollars in fiscal measures, or 6.5 per cent of gross domestic product (GDP), while the 1998 Asian financial crisis saw fiscal programmes worth 12.5 billion dollars, or 9.1 per cent of GDP, Macquarie Research said.

The 2001 budget measures totalled 13.5 billion dollars or 8.8 per cent of GDP, Macquarie added.

Singapore's GDP in 2007 totalled 243.2 billion dollars (164 billion US).

Finance Minister Tharman Shanmugaratnam has said this year's "significantly expansionary" budget will emphasise help for businesses. Late last year, the government pledged 2.3 billion dollars in credit support for firms trying to survive the economic turmoil.

In a commentary published in The Straits Times, Citigroup's Kit said the budget should focus on easing financial stress on companies, improving cost-competitiveness, providing support for affected families and giving a modest demand stimulus to the economy.

This would translate into corporate and individual tax cuts, rebates on taxes and utility bills, financial doleouts and funding for the retraining of laid-off workers so they can find jobs in less-affected sectors, other analysts said.

Accounting firm KPMG suggested the government should reduce the corporate tax rate from 18 per cent to 17 per cent.

Kit proposed a wider two or three-percentage point cut that would "send a powerful signal of the government's commitment to maintain Singapore's competitive position and encourage companies to make longer-term investments in the country".

While the government should draw up a power-packed budget this year it should also reserve ammunition in case the recession gets worse and lasts longer, analysts said.

Singapore is Southeast Asia's wealthiest economy in terms of gross domestic product per capita, but its trade dependence makes it sensitive to problems in developed economies, particularly key export markets of the United States and Europe, which are also in recession.

- AFP/yt

House brands a hit

Supermarkets report jump in sales as higher-income shoppers switch brands
Jan 20, 2009
By Jessica Lim (Straits Times)
HOUSE brands are flying off the shelves at record speed as the recession bites deep, and even better-off households are increasingly turning to them.

Though the most popular items include staples and necessities such as rice, bread, cooking oil and toilet paper, supermarkets are catering to increasing demand by packaging everything from wine to olive oil under their brand names.

The Straits Times' checks with major supermarkets here found that sales of house-brand items such as rice had as much as trebled in the June-December period last year, compared to the same time in 2007. Overall, they said, sales of house-brand goods rose 50 per cent during the same period.

And with the economic outlook for the next few months - at least - looking increasingly gloomy, they say such items will only grow in popularity.

The supermarkets said the bulk of the increase in sales is due to demand from higher-income shoppers.

A Sheng Siong spokesman said that marketing surveys and feedback have shown that 'higher-income levels are more receptive towards house brands'.

Cold Storage said it has also observed a change in shoppers' behaviour.

The supermarkets think the shift is due to the 'improved perception and acceptance of house brands', a wider range of products, and improved quality.

The results of a Nielsen survey of 1,000 households also pointed to a similar change in habits.

It showed that of the 280 households with a combined income of at least $6,000 a month, 71 reported buying house brands in the June-November period, compared with 60 for the preceding six months - an increase of about 19 per cent.

This group registered the largest jump in house-brand purchases in the survey period.

A retail management lecturer at Ngee Ann Polytechnic, Ms Emiline Lee, said: 'In the past, those from the higher-income strata would not even look at house-brand products. But now, they are willing to switch. They realise they can save money, and that house brands are of higher quality as well.'

Buying such products can lead to big savings, she explained.

Going the generic route with staples such as rice, oil and toilet paper alone can shave as much as 20 per cent off a typical family's grocery bill.

On average, house-brand items are 15 per cent cheaper, but the difference can be much, much more. Ten rolls of FairPrice's brand of bathroom tissue, for example, costs $3.82. The price of 10 rolls of Kleenex is almost double that, at $7.50.

Consumers - both the less well-off as well as middle-income - who spoke to The Straits Times said they now actively seek out house brands.

'For me, it does not make a difference. Some items you use a lot very quickly so you don't need luxury versions,' said Ms Leena Sumukhan, 33, a working mother of two whose monthly household income is $8,500. Switching to house brands for items such as bread and pasta, she said, saves her about $30 every fortnight.

For housewife P.H. Ho, 33, saving money comes first.

The mother of two, whose husband takes home $9,000 a month, turned to generic washing powder and toilet paper last year. 'The priority now is to save money,' she said.

Meanwhile, because of surging popularity, supermarket chains are adding more products to their house-brand range.

FairPrice has plans to extend its range of housebrand products from the current 2,000 to 3,000 by 2012, and Cold Storage is going to introduce 20 per cent more products to its current 1,600 product range this year.

Sheng Siong, which now has about 20 house-brand items, will extend its range to include oil, frozen food and condiments.

limjess@sph.com.sg

Additional reporting by Cheryl Ong

Survey shows more high-income households turning to house brands
By Cheryl Frois, Channel NewsAsia
19 January 2009 2108 hrs

SINGAPORE : Amid the deepening recession, supermarket house brands or private labels are growing in popularity, with high-income households making the biggest switch among all income groups.

Such households, with a combined monthly income of over S$6,000, now make up over 28 per cent of all house brand buyers.

Together with middle-class households - which have a combined income of over S$4,000 - they account for 49 per cent of all house brand consumers.

A market survey by The Nielsen Company shows that staples such as rice, bread and cooking oil, and paper products like toilet rolls and facial tissue, are the most popular items.

Described as a never-before-seen phenomenon, the survey found that the penetration of house brand products now stands at 91 per cent, with over nine in 10 households having bought at least one of these items in the six months ending in November last year.

Nielsen also said overall spending and purchasing frequency of house brands also grew in the same period. - CNA/ms

Singapore opens border facility to reduce threat of chemical, biological attacks

By Hoe Yeen Nie, Channel NewsAsia
20 January 2009 1435 hrs

SINGAPORE: Singapore has opened the world's first border facility to weed out the threat of chemical and biological attacks.

Called the Protective and Analytical Facility, it is located at the Tuas Checkpoint in western Singapore.

About a million cargo vehicles pass through the Tuas Checkpoint every year. As the frequency in border crossings between Singapore and its neighbours increases, so too does the threat of a biological attack.

All hazardous cargoes and livestock entering Singapore must do so through the Tuas Checkpoint. This makes frontline customs officers at the checkpoint most at risk of exposure to chemical and biological hazards.

The new facility will strengthen Singapore's defence against these threats. An early warning system will detect the release of hazardous agents at the checkpoint cargo lanes.

If there is a chemical spill or deliberate attack, those affected can wash themselves at the decontamination facility. There is also a laboratory to identify and analyse the chemical.

Singapore's Deputy Prime Minister Wong Kan Seng, who is also the Home Affairs Minister, said: "Our checkpoints cannot be viewed simply as a mere crossing for efficient immigration and customs clearance procedures. It is the critical first line of defence of our national security."

Citing the SARS episode in 2003, Mr Wong also warned against biological agents that could cause an outbreak in the country.

Mr Wong said while they may not be terrorist acts, their potential consequences are no less devastating.


New border facility opens
Jan 20, 2009
By Teh Joo Lin (Straits Times)
A NEW $4 million laboratory and decontamination unit at Tuas Checkpoint, which can spot chemical, toxic and biological agents in consignments carried by trucks into Singapore, opened on Tuesday morning.

In the event of any accidental or deliberate spillage, checkpoints officers who come into contact with toxic substances can also decontaminate themselves in the unit within a few minutes of exposure.

The two-storey Protective and Analytical Facility, located next to the cargo checking area, was opened by Deputy Prime Minister and Home Affairs Minister Wong Kan Seng.

The building is touted to be the first of its kind at border controls around the world.

Speaking at the opening ceremony, Mr Wong said hazardous materials like chemical and biological agents could be smuggled into Singapore by terrorists, so the 'facility is a critical addition to our surveillance capabilities of security-sensitive materials and infectious diseases that could cross our borders'.

Pointing to a 2 per cent increase in the number of contraband smuggling cases at the checkpoints last year over 2007, he added that 'if one can smuggle cigarettes, one can smuggle terrorist operatives or explosives into the country'.

There were about 38,600 contraband seizures last year.

Average household income up across all income groups in 2008

By Julia Ng, Channel NewsAsia
20 January 2009 1700 hrs

SINGAPORE: Singaporeans of all income groups saw a real growth of 6 per cent in their family income last year.

The Department of Statistics attributed this to strong labour market conditions for the most part of 2008, leading to an increase in the number of working persons in a household.

The median monthly household income among all resident households grew 13 per cent from S$4,380 in 2007 to S$4,950 in 2008.

After adjusting for higher consumer price inflation, households enjoyed real growth of 6.2 per cent last year, compared to 7.2 per cent in 2007.

Families in smaller housing types enjoyed stronger income growth than those in bigger housing types.

Those in 3-room or smaller flats saw a 13 to 15 per cent jump in median household income, or 6 to 9 per cent in real terms, while income for those in bigger housing types grew by 9 to 12 per cent, or 2 to 6 per cent in real terms.

The average household income per household member also increased in real terms across all income groups. The increase was highest between the 21st and 90th percentile employed households, which saw a 5 to 5.4 per cent increase in 2008 in real terms.

The bottom 20 per cent employed households had an increase in real income per household member of 2 to 3 per cent, while the top 10 per cent employed household had growth of 0.9 per cent.

With faster income growth among the 21st to 90th percentile of employed households, income inequality narrowed – the Gini coefficient, which measures income inequality, shrank from 0.489 in 2007 to 0.481 in 2008 for the first time in a decade.

The government's Surplus Sharing Package also helped to reduce the income disparity further in 2008. After adjusting for government benefits and taxes, the Gini coefficient among employed households was reduced to 0.462 in 2008, compared to 0.479 in 2007.

The Department of Statistics noted that the package gave a larger boost to the lower income groups. On average, it added S$1,670 per household member to Singaporean families in HDB 1- and 2-room flats, and S$1,320 each to those in 3-room flats.

This is more than the S$720 per household member for families in private flats and landed properties.

The statistics department's paper is available online at www.singstat.gov.sg.

Household incomes up

Income gap here narrows.
By Aaron Low (Straits Times)
Jan 20, 2009

DESPITE the severe impact of inflation, Singaporeans were bettter off last year. Their family income rose across the board.

A key reason for the increase was the buoyant labour market, which saw more people with jobs and drawing higher salaries.

Latest official figures show the average monthly income for all Singapore households went up by about $700 in a year, from $6,300 in 2007 to $7,090 last year.

The group showing top gains is the middle-income household, with incomes of $6,730 a month. Even after inflation was taken into account, their annual income per family member rose the fastest at 5.4 per cent last year, according to an occasional paper released by the Department of Statistics on Tuesday.

The paper is Key Household Income Trends in 2008 .

Worst off are the bottom 20 per cent of household earners, according to the paper on Key Household Income Trends in 2008.

After working in inflation, the bottom 10 per cent earned just 1.9 per cent more last year, while the 10 per cent above it made 2.9 per cent more. But Government help in the form of GST (Goods and Services Tax) credits and Workfare Income supplement helped improve the lot of the lower income.

On average, a person living in one- and two-room HDB flats received about $1,670 from the Government last year. The sum is more than double the $720 given to residents of private property.

The result of the income improvements is a narrowing of the income gap in Singapore, said the Statistics Department.

As a result, the Gini coefficient, which measures income inequality, has dropped from 0.489 in 2007 to 0.481 last year. If Government aid is taken into account, the figure drops further - from 0.479 to 0.462.

The gap narrows

But will this improvementfade as the recession deepens?

Wednesday • January 21, 2009 (TODAY)
Lin Yanqin
yanqin@mediacorp.com.sg

IT HAS been topmost of policy-makers’ list of worries in recent years, so it is ironic — and unexpected — that signs are showing of a long-awaited turnaround in the widening income gap, just as the most difficult downturn in decades is gripping Singapore.

For the first time in 10 years, the disparity between the :top and bottom income earners narrowed, as incomes of the lowest earners grew faster than those of the top earners last year.

But will this reversal prove a blip, in the face of a deepening recession this year? Analysts’ views are mixed — with some saying the anticipated Budget bonanza would help lower-income Singaporean level up, while others fear retrenchments among this group could undo progress made.

According to the Department of Statistics (DOS), which released its annual Key Household Income Trends 2008 report yesterday, the Gini coefficient — a measure of income inequality — shrank from 0.489 to 0.481 as a result of a strong labour market, which saw more working persons in an average household.

Incomes of smaller flat-type employed households grew faster, with those in one- and two-room HDB flats enjoying a 12.5-per-cent income spurt; the increase was just 0.6 per cent for those in private housing.

The median household income from work also rose by 13 to 15 per cent for resident households in three-room or smaller flats — compared to 9 to 12 per cent for those in bigger housing types. Across the board, the median income among resident households was $4,950.

While the Gini coefficient has contracted twice before, in 2002 and 2006, those times were the result of Government handouts and rebates boosting the lower-income groups.

But in 2008’s case, the Government’s Surplus Sharing package was icing on the cake of actually shrinking income disparity. The package – which included Growth Dividends, Workfare Income Supplement and utilities rebates – further narrowed the gap to 0.462.

:



SUBHD: Govt’s support vital to narrow the gap

On the side of optimism, CIMB-GK Research head Song Seng Wun thinks it possible for the income gap to further narrow as it tends to do during recessions.

“In a downturn, there are usually Government measures to help the bottom half and support their income, so this trend could continue,” he said. :Conversely, he adds, times of growth usually see the disparity widening.

However, if retrenchments hit jobs held by the lower-income – such as in the manufacturing sector – then the gap could widen again, said Forecast Singapore analyst Joanna Tan.

:Unionist Rajendran Govindarajoo, for one, is not hopeful. He notes that while rank-and-file workers last year benefitted from a strong labour market, it is unlikely to be the case this year. “The downturn will be bad, with employers cutting costs, so I don’t think we will see incomes rise,” he said.

Last year, the bottom 20 per cent of employed households saw incomes rise by 2 to 3 per cent, while the top 10 per cent had just 0.9 per cent growth. But the income gap could have been wider had income earned from non-work sources – such as dividends and rent – been included in the survey, noted Standard Chartered economist Alvin Liew.

The DOS notes that compared to lower-income households, upper-income households had more members already working, hence their household income would grow more slowly.

Without continued Government measures to support the incomes of the lower-income group, Mr Song feels the narrowing of the gap cannot be sustained over time.

Mr Liew agrees. Last year’s figures aren’t likely to signal a turning of the tide, since widening income disparity is “an economic trend we’re seeing globally”, he said. “The Government will have to continue to manage this situation and keep the social fabric cohesive.”

:Last year, its surplus-sharing package added $1,670 to each member’s income in one to two-room HDB resident households, which worked out to 26.5 per cent of each household’s income.