NURTURE
Co t?
At WhatTwo Cities
A Tale of
By Antoinette Tan
Singapore was recently
ranked the World’s Most
Expensive City to live in
2014, knocking even the
likes of Tokyo and Paris
off their thrones. But is
our city-state really that
costly to live in and raise
a family? Antoinette Tan
investigates.
It’s no surprise that our recent
victory as the World’s Most
Expensive City has sparked much
contention; politicians hastily
downplayed its findings despite the
crescendo of local gripes about
rising costs, which now appear to
be confirmed by the Economist
Intelligent Unit (EIU) report.
However, are we really the most
expensive city? How is it possible
that we toppled even Tokyo, Paris
and Zurich, which have gained a
longstanding reputation for being
the costliest? Has our cost of
living truly gone up? What are the
repercussions? More importantly is
raising a family still conceivable?
TOP 10 MOST EXPENSIVE CITIES
1. Singapore
2. Paris
3. Oslo
4. Zurich
5. Sydney
6. Venezuela
6. Geneva
6. Melbourne
6. Tokyo
10. Copenhagen
THE EIU SURVEY
The bi-annual EIU Worldwide Cost
of Living Survey compares more
than 400 prices of 160 products
and services across 131 cities.
These include food, drink, clothing,
household supplies, personal care
items, utility bills, transportation, as
well as recreation and entertainment
costs. Predictably, the report
findings ignited an onslaught of
affirmative responses on multiple
media by disgruntled Singaporeans
who have been feeling the pinch for
the past several years.
In a bid to reassure its residents,
Deputy Prime Minister and
Minister for Finance, Mr Tharman
Shanmugaratnam, addressed this
issue at the Budget 2014 Debate
Round-Up in March. He mentioned
three main reasons the EIU report
is not relevant to us: the objective of
the survey, the exchange rates, and
the types of goods and services that
were being compared.
“First, as the Singapore dollar
strengthens, it becomes more
expensive. But the reverse is true
for Singaporeans. The stronger
Singapore dollar improves
purchasing power for Singaporeans.
The second important difference
has to do with what goods and
services are being measured as
part of the cost of living basket in
these surveys. The EIU tries to put
together a basket of what they think
are expatriate costs, perhaps more
on the higher end of expatriates.
It is quite different from the goods
and services consumed by ordinary
Singaporeans.”
The minister assumes that expats
and locals consume completely
different goods and services, to
which Jon Copestake, Editor of
the EIU report, responded that the
basket of goods included many
everyday items.
“The survey basket ranges from
a loaf of bread to a luxury car. In
fact, the highest-weighted category
in our survey is that of groceries
and everyday staples which
include goods like fresh fruits and
vegetables, meat, fish, rice, etc.,”
So, how much are we really paying?
We compare the prices of our
everyday goods with Melbourne,
voted one of the World’s Most
Liveable City yet only the sixth most
expensive in the survey.
While the benefits may ease
disposable income burdens,
milk formula in Singapore is
comparatively more than double
that in Melbourne at an average
of SGD45.61 for an 800-gram tin
compared to AUD21.58. This
would make a substantial amount
spent over an extended period.
Add to that the disparity in
purchasing power and
disposable income and Singapore
becomes an expensive place
to live and raise a child.
May 2014 • Family & Life
15