And The Hippocratic Politicians …..

When the politicians are rewarding themselves with high % increase to the already world no 1 salary and expecting the poor hawkers to keep their price constant so as to keep their chances alive in the coming election. Even the poor daughter of hawkers know where the major cost burden comes from but not the politicians? This is Dirty Politics!

What about not raising rents

Letter from Eileen Tan Chwee Lin
Source:  Mar 29, 2011
I read with quite a bit of indignation the reports of MPs going around hawker centres and coffeeshops urging stallholders to be part of the Retail Price Watch Group by making them promise to maintain their prices.

I don’t understand why they are targeting these “retailers”, who sell food items at prices considered more than reasonable, at S$2 to S$5?

The small profits of these food sellers would have been squeezed by higher ingredient prices and higher rents. Shouldn’t the MPs look at dealing with the increasing cost upstream by urging landlords not to raise rents or by getting wholesalers to similarly pledge not to increase their prices?

And a comment from a reader Jessie from Todayonline
Updated 09:50 AM March 29, 2011
I could not agree more with this letter. My parents are hawkers, and I have seen them toil long hours just to pay rental.

This whole system is flawed. NEA rent out hawkers stall by highest bids, which most of the time is a reasonable $1200 to $2400 depending on location.

But what actually happens is that the successful bidder instead of operating the stalls themselves they rent it out. Most of the stalls my parents have been operating over the years they are the second or even third sub-rentors, meaning they rent from one person who in turn rent from another person.

When government gives rebates to hawker stall holders, they too do not pass it to the operators but pocket it.
The authorities have conducted spot checks but these have not yield any results so far.

More absurdly is that successfully bidders will try to sell the right to operate the stall to another person who is interested for about $10 000(min depending on location).

I strongly urge the authorities to stop this kind of profiteering before our fishball noodles and laska become $10 per serving

And the reply from the politicians and you be the judge if you are convinced:
Letter from Lim Hwee Hua and Cynthia Phua
PLEASE refer to the letter from Eileen Tan Chwee Lin, in response to efforts by the stallholders to maintain their prices.

Eileen has made a good point about getting wholesalers and landlords not to raise their prices or rentals. Indeed, this is very much the case. We have secured some assurances on not raising rentals and will continue to do so.

We, as Members of Parliament, were going around the markets and food stalls to thank the stallholders for taking the initiative through their respective business associations to make the pledge to maintain prices.

At the same time, we are publicising their great gesture to residents so that there will be more patronage in return. We will continue to do what we can to support them as well.

Tackle big business, not hawkers, about price hikes

ST, Forum, Apr 10, 2011

There has been much debate recently on hawkers increasing their food prices and some are even said to be profiteering (‘Govt to track hawker food prices’; March5 and ‘Hawkers pledge to keep prices steady’; March 27).

Cabinet ministers have also come out to ask hawkers and stallholders not to increase their prices.

When airlines raise their ticket prices, when taxi fares go up, when car insurance premiums are increased, and when the price of petrol and cost of electricity are raised, I do not hear any of the ministers asking these large corporations not to initiate the price hikes.

At the end of the year, these large corporations end up with millions, if not billions, of dollars in profits.

The reason often cited by these companies for the price hikes is higher overheads and costs. Well, that is exactly the same reason used by the hawkers.

Profiteering is defined as someone who seeks exorbitant profits. If millions or billions of dollars are not exorbitant, I do not know what is.

The hawkers are merely trying to earn a few dollars more to cope with the higher costs of living and inflation.

Airlines and hotels charge more when it is peak season; taxis also charge more during peak periods.

Can a hawker charge more for a bowl of noodles during weekends and less on weekdays?

How about a drink stall charging more for a can of Coke on a hot day and less on a rainy day?

After all, the big boys are practising multiple pricing depending on demand, so hawkers should be allowed to do the same.

Let’s not bark up the wrong tree. The ministers should take on the big boys and leave the poor haw-kers alone.

If the hawkers are indeed profiteering, very soon they will have no more customers.

James Wong

And a sharp observation from a The Straits Times reader warning that the politicians should focus on the big guys not the poor hawkers who do not earn much and where competition is keen. 

Focus on oil firms, not hawkers

The Straits Times Apr 16, 2011

THE reply by the Ministry of Trade and Industry (‘New watch group’s aim is to monitor, not control, prices’; Thursday) regrettably sounds unconvincing.

Included in the highlights of a recent Asian Development Bank report on growth in Asian economies were the threats from rising prices of oil, food and commodities.

We are aware of rising oil and food prices partly due to the political unrest in the oil-producing Middle East, the increasing demand for grain or food items from consumers as well as bio-fuel producers, and overall increase in demand for food items from high-growth economies.

Seen in this light, it seems illogical when hawkers promise to hold prices for six months.

It is difficult to comprehend how they can give this undertaking when the prices of food items are quite unpredictable.

Equally difficult to believe is the assertion that hawkers, after they came to know of the setting up of the Retail Price Watch Group, voluntarily signed up to maintain prices.

The same argument can be advanced against keeping a close watch on any excessive price increases and anti-competitive behaviour by supermarkets.

The three supermarket groups named are fierce competitors in the retail trade. There does not seem to be any case to partner these organisations to maintain prices.

It is disturbing to see ministers and MPs participating in media efforts to publicise the undertaking by retail groups and hawkers to maintain prices.

Such efforts create the impression of some indirect pressure, although the Ministry of Trade and Industry (MTI) says there is none.

MTI is spot on when it says that keeping prices artificially low is not sustainable and will create other problems, as the experience of our neighbouring economies will testify.

The Government should distance itself from setting up or promoting such apparently voluntary price watch groups.

To control anti-competitive behaviour, MTI should focus on petroleum companies that increase pump prices by virtually identical amounts within a timeframe of 24 hours.

It is quite extraordinary that all of them suddenly realise the increasing prices of inputs and more astonishingly, act in unison.

The Government’s view of such price adjustments is that they are beyond the control of oil companies and that the Government would rather allow the market mechanism to determine pump prices.

I would suggest that MTI apply this logic across business groups including supermarkets and hawkers, and not only to oil companies.

Hariharan Gangadharan