Tag Archives: price hikes of fuel

Spiralling Cost Of Living


The good old advice we get from the government, whenever inflation sets in, is to tighten our belt. How are we to tighten our belts when they are already too tight? 

The recent price hikes of fuel, diesel, gas and sugar are slowly but surely beginning to make an impact on the rakyat, especially Ipohites. I was completely unaware of the rise in prices until I stopped by my neighbourhood petrol kiosk on the morning of Saturday, December 4 to fill up my tank. The cashier politely reminded me that the price of petrol (RON 95) was no longer RM1.85 a litre but RM1.90. She told me that the price was effective some 7 hours before.

“What?” I retorted, “Another hike?” The guy beside me looked dejected, paid his due and left in a huff. “Not only petrol, Uncle!” she responded, “but diesel, gas and sugar too.” She raised her arms to demonstrate her displeasure. “How to survive, mah?”

Wendy, the cashier, is a single mother with three school-going kids. I empathised with her. Life is indeed a struggle for this gritty forty-something who has been behind the cash register since I began patronising the kiosk many years ago. With a take-home pay of about RM1,200 a month, raising a family of three is no easy task considering the demands children make on their parents these days. “I have to keep the kids at home this school holidays,” she muttered.

My usual RM50 gives me 26.32 litres of RON 95 instead of the previous 27.8 litres. That is a small price to pay considering those who purchase RON 97 regularly. The same amount of money could only buy 21.74 litres not 23.3 litres as before. RON 97 now costs RM2.30 a litre, up by a hefty 15 sen since November 2.

Few realise that a rise in petrol, diesel, gas and sugar prices will have a rippling effect on the prices of commodities. It is similar to the multiplier effect associated with the increase in money supply on aggregate demand, a theory advanced by economist, John Keynes.

The hike in prices of gas and sugar will have a  far greater impact on individual households than perhaps, petrol. Cooking gas is now priced at RM23 for a 10-kg canister and RM28 for a 14-kg  canister  while sugar is RM2.10 a kilo. The latest pricing has already affected the way mamak shops do business. Malaysians’ favourite drink, teh and kopi tarik now cost RM1.10 up by 10 sen. Some are even charging more. Roti canai, another favourite, costs RM1 a piece at Pelita and Nashmeer, two popular restaurants in the city.

Inflationary pressure will cause food prices to escalate thus burdening the poor and the marginalised more than ever. The good old advice we get from the government whenever inflation sets in, is to tighten our belt. How are we to tighten our belts when they are already too tight? Other too-often quoted measures are: “Stop eating at expensive restaurants”, “Prevent wastage by not buying more than you can eat” and the classic, “Do not buy on impulse.” All these admonitions mean nothing to the Dollah, Muthu and Ah Chong in the streets when their lives are akin to the Malay proverb, “kais pagi makan pagi kais petang makan petang” (scratch in the morning eat in the morning, scratch in the evening eat in the evening). 

The average household consumption expenditure over the last 20 years has gone up by almost 250 per cent. In 1973 a family of five could survive comfortably on RM400 a month. By 1995, the sum has gone up to RM1,200. At the onset of the new millennium, the figure touched the RM1,700 margin. Today RM2,000 in Ipoh will get the same family nowhere. No wonder cashier Wendy is so demoralised.

I seldom take the official Consumer Price Index (CPI) seriously as it does not reflect the truth on the ground. The government develops statistics so the inflation-weary rakyat will direct their hostility at the business community instead of the authorities. Real household income has been growing but at a snail’s rate of 1 per cent a year. Just think how much your last pay raise was.

In 2006, when Najib was Deputy Prime Minister, he asked Malaysians to change their lifestyle in order to face the spiralling cost of living. Someone responded, rather sarcastically: “How are we going to change our lifestyle when we have none?” He could not have been more precise.

Fathol Zaman Bukhari