Hornbill Unleashed

December 30, 2013

When even RM12,000 a month isn’t enough to get by in Malaysia

Filed under: Human rights,Politics — Hornbill Unleashed @ 12:00 AM
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A hawker stall in Lebuh Chulia, George Town. Penang is known as a foodies’ heaven but the state is one of the most expensive places to live in for an average wage-earner. – The Malaysian Insider pic by Hasnoor Hussain, December 29, 2013.TMI

A hawker stall in Lebuh Chulia, George Town. Penang is known as a foodies’ heaven but the state is one of the most expensive places to live in for an average wage-earner.

How much does it take to have a decent life in Malaysia? That has been the top question in the country in the past few years and a greater concern in 2014 as electricity rates and transport costs go up and subsidies go down.

While Putrajaya talks up proposals to help the people mitigate rising prices with cost of living labs and possibly even more targeted subsidies, most Malaysians are looking at the prospect of expenditure exceeding their monthly salaries.

One of them is Caroline Wong, who believes her combined household income of RM12,000 is not enough to sustain a living in Penang, famed for its beaches as much as it electronics manufacturing sector.

The 34-year-old clerk lives with her husband, a sales manager and their young daughter are starting to feel the pinch despite earning an income that was once sufficient to live comfortably.

“We are always eating in at home now and we can no longer afford to buy goods like branded clothing,” Wong told The Malaysian Insider in Penang’s capital city George Town.

According to Wong, every month the couple have to fork out RM4,000 for the house and car, RM1,500 on food and another RM1,500 on daycare, baby food and milk for their child.

On top of that, there is RM750 on insurance and a family medical card, RM700 on petrol, RM600 on phone bills, WiFi and broadband, RM120 on Astro, RM140 on water and electricity bills and RM110 on a weekly housekeeper.

“We put aside RM500 every month for road tax and car insurance. Come May next year, we will have to spend another RM1,500 a month on our second child when it arrives,” Wong said.

Her tale is just one of many who are living in Penang, the country’s most expensive city.

As 2014 begins, Malaysians will be facing a new challenge in dealing with the rising cost of living as the price of goods and services is expected to go up.

A poll by The Malaysian Insider found that Penang, a popular tourist destination, is more expensive to live in than Kuala Lumpur.

The cost of living survey conducted in December covered Penang, Kuala Lumpur, Johor Baru, Kuala Terengganu, Klang, Kuching and Alor Star.

The survey compared prices of necessities, such as chicken, vegetables (mustard greens and red chillies), fish, house rental and the minimum wage in a month.

“Prices of goods are determined by the market and it depends on consumers to control their expenditure,” said Datuk Paul Selvaraj, secretary-general at the Federation of Malaysian Consumers Association (Fomca).

“It is the responsibility of the Government to minimise the impact on consumers, but in some situations the responsibility falls on the individual.”

Critics have complained that the slow rate of increase in household income would not be able to cope with the recent slew of price hikes of items, such as electricity tariff, toll, school bus fares and assessment rates.

An individual would require an income of RM4,000 to survive on Penang island, given its high rental and expensive daily goods.

Trailing closely behind Penang are industrial cities Bintulu in Sarawak and Paka in Terengganu.

However, prices of goods in Penang are much lower on the mainland in places such as Seberang Prai.

The lower cost of living has made nearby mainland towns a sprawling suburban neighbourhood with heavy traffic flow daily on the connecting Penang Bridge.

The poll conducted in December found that a kilogramme of chicken cost RM9 in Georget Town, while it was only RM7 in Kuala Lumpur and RM6.50 in Klang, Selangor.

In Kuala Terengganu, prices of daily goods are comparatively higher despite its lower cost of living.

A kilogramme of chicken cost RM7.50 while fish, such as mackerel at the Chabang Tiga market cost between RM10 to RM15 depending on the quality.

The cost of seafood there is also not cheap although it is located near fishing villages.

However, low rental rates and toll-free roads have kept the cost of living relatively low in Kuala Terengganu.

With an income of RM2,500 a month, a family can own a car and rent a home.

In the same state of Terengganu, some 120km away, the cost of living in towns like Paka and Kerteh are much higher since they are home to employees from the oil and gas industry.

Locals have to bear the brunt of high expenses since industrial employees receive higher salaries.

The same is happening in the Sarawak towns of Bintulu and Miri, where oil and gas firms have set up base.

As a result, locals are also witnessing a stark increase in the prices of goods and rental rates.

Rental rates in Penang are soaring high with a single-storey three-bedroom home in Tanjung Tokong costing RM1,000 a month.

Rental rates are, however, cheaper in Batu Kawan or Nibong Tebal with rents hovering around RM500 per month.

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9 Comments »

  1. TNB reported profits of RM5.9 billion before tax for the financial year ending August 31, 2013. Despite the healthy profits enjoyed by TNB, Najib still bowed to the energy firm’s demand to increase tariffs. Do not forget Singapore cut the electricity tariffs for its people in 2014!

    Comment by Zam — January 2, 2014 @ 12:10 PM | Reply

  2. It is too late for our country to do anything about unchecked inflation. The simple truth is our country interfered too much in business. Our country is over-regulated. I remember when Dato Chua Jui Meng was Dy Minister of International Trade, he used to give speeches about how high was our Purchasing Power Parity or PPP. The same thing cost less here in Malaysia than elsewhere. Our Ringgit could buy more things here than elsewhere.

    How did we achieve this? By a madness called price control of goods whilst locking the supply. He was advised that “The government simply shouldn’t. The businessmen should. But we took the wrong path. So things were really cheap. In Penang a bowl of noodles could be had for RM2. Foreigners find Malaysia a haven. Malaysians could hardly afford to spend money whilst abroad. But price control without an free market means that whoever is in the market would have to languish selling at low prices, but this was better than for those who are not allowed into the market. The ills are felt not just in producing industries but also in the distribution industry. For example, regardless of a high world price, Malaysian Palm Oil producers and distributors were instructed to sell retail packaged products below world price. Consumers were happy but they failed to learn something important, that you must weigh the cost of everything. A Chinese proverb says it all: You eat rice but you don’t know its value.

    For example, mid-1970’s there was a world shortage of rice. What did Malaysia do? We controlled the price. The people were happy. What did Singapore do? The let a free market determine the prices. Malaysians sneered at Singapore for not caring for the people. This was when, worldwide, Chinese Restaurants started charging for white rice. But in a free market, if a high price means big profits, other producers can enter the market and their competitive pressure would bring prices down. But not in Malaysia. So when the supply situation over-corrected, rice in Singapore was cheaper than lousier rice in Malaysia. Why? Because in Malaysia a trader cannot simply jump into the market and import and sell cheap rice.

    In this environment, the nation today is trying to grapple with certain inexorable uncontrollable price increases. The solution is to free the market. But Malaysia still holds controls over every supply line. Why not let us import pork if Malaysian producers cannot be competitive? If competitive, why not export pork? The fact that we don’t export means we are not competitive and that means we in Malaysia pay more. But can the government simply open up the whole market? Sadly, only by causing hardship for the low-income. We had high PPP but no longer. Our low incomes could let us survive high PPP. But we do not have high PPP anymore. So we need higher incomes which we have not got because our economy is so stifled by controls by these control freaks called politicians. If they are so good in business that they can set rules why not they become businessmen and see how they fare.

    So it is too late. Uncontrollable inflation is upon us. And it will take a long time for our incomes to rise first to ameliorate the ravages of inflation, and then overcome it. The solution is to remove controls so that Malaysians will compete in world markets without preventing inundation of our market with world products Then we will have learned economics. We are, and will suffer for our bad economic management. There is no way out.

    Comment by Pohchee Kay — January 1, 2014 @ 5:18 PM | Reply

  3. The following is extracted from the comments section from another website http://news.malaysia.msn.com/malaysia-news/bn-leaders-hit-out-at-umno-politician-for-%e2%80%98leave-the-country%e2%80%99-remark

    I believe the commenter is a typical UMNO (zombified) Malay, perhaps a cybertrooper.

    “If you are a member of a club or similar organisations but you don’t like the club’s policies & actions yet you can’t do anything democratic within the organisation’s rules to change the situation, then you should resign & get out as a civilised gentleman/lady. The same things should apply if you are a member of a political party, BN or PR – resign & get out. It should similarly also apply if you are a citizen of a country – get out as you please if you don’t like things there and can’t do anything to change them legally & democratically. If you are really good enough with the right stuff, other countries are ready to receive you & your family with open arms. No hard feelings in this matter, after all your mothers & fathers left their mother or fatherlands just to deliver you to the world here well before. If your mothers & fathers liked their mother or fatherlands they would not have left.”

    In this context here I surmise that that in our present Malaysian society daily bread and butter issues of interest to the man in the street are easily sidetracked and hamstrung by sentiments of racism and religious bigotry that gets us nowhere. Every problem, every issue and every controversy are more often than not saddled by racial and religious complications. At the end of the day, the gist of the matter is still: for the Chinese and Indians, if you are not happy with rising prices…Balik Cina, Balik India-lah…apa tunggu lagi.

    For the second class native bumiputras (Sabahans and Sarawakians) the ethos is if you are not pleased in the least, better Masuk Hutan-lah…plenty of natural goodies inside the rainforests. If not simply consider the expediency of “Masuk Melayu dan Masuk Islam”.

    Comment by nickkraemr — December 30, 2013 @ 7:56 PM | Reply

    • Non Malay natives of Sabah/Sarawak ( bumiputera , not bumiputra) may not be a first class bumiputera but no survey has proven they are worse off than Malays. They do not get first class treatment but let us see the situation in Kuching – Rampangi, Samariang, RPR Sukma, Kampung Kudei are all inhabited by Malays. Is there any resettlement scheme for Iban, Bidayuh etc etc? No. What does this show? Poverty and backwardness to the people resettled, they have resettled but they are still the same people – kaki lepak, Many christian bumiputeras will not masuk Melayu and masuk Islam as you implied. Many will toil in their farms and garden and selling farm produce, vegetables, maize and not merely pucuk ubi, pucuk rebung and pucuk paku. My point is embracing Islam will not answer the poverty problem and Christian bumiputeras fully understand this, and there is no danger of diaspora of Christian bumiputeras to Islam.

      Comment by Pehin no no — December 31, 2013 @ 1:36 PM | Reply

  4. Whilst those who are employed might half at least half a loaf of bread to survive. What about those retirees and pensioners. What about the sick and old who don’t have any source of real income. The students and unemployed. To complicate further, wages are going up at snail pace, stagnation of wage, declining purchasing power and disposable income. What is wrong with our government? Do they see the economic tragedy unfurling in front in front of their eyes? Where is our jet set Prime Minister cum Finance Minister? Does he not care to cure the economic ills facing the nation or he is still enjoying his “honeymoon” period? It is mind boggling the Najib administration appears to be not bothered with what is happening. The ONLY thing that I heard is the government wants to set up a so-called “LAB”. What a nasty year end joke is this? Get out of your ivory tower Mr. PM and see how people are suffering due to price hike in virtually everything.

    Comment by Jaq — December 30, 2013 @ 5:58 PM | Reply

  5. Ringgit has depreciated 10% vs Renminbi and USD in the last one year.

    Rakyat got a double whammy of Barang Naik + Ringgit Jatuh!

    Comment by Zuraidi — December 30, 2013 @ 2:24 PM | Reply

  6. Depending on your live styles of each person or family ? Of course, having meal comprised of abalone,bird nest, shark fin. 2 inches thick beef fillet, ikan empulau and shopping for premier clothing,driving a Merc or BM is definitely insufficient. As for a Ulu resident ulam sambal belacan, sky juice, low grade rice, kopi kosong, baju dan seluar of the 80’s, walkwagon, gonggongquche or public bus and contributed affordable sum at temple of “wannabe instant millionaire” in town, RM300/month is quite okay.

    Comment by kira commonsense — December 30, 2013 @ 12:40 PM | Reply

    • 12,000 today is equivalent to 1,200 ten years back – new bills and new names – Astro, internet, credit card, cellphone bills, insurance, tolls, assessment, income tax, baitulmal, tabung haji, kutu, online purchase, study loan, no subsidy, no rebate, road tax, driving licence, bank rakyat, angkasa, personal loan. 12,000 is really insufficient.

      Comment by No Double Talk — December 31, 2013 @ 9:35 AM | Reply

  7. Is the RM 12,000 income net or gross income? Sounds a lot, if it is inadequate. Are housing loan relaunched included?

    Comment by Public — December 30, 2013 @ 7:37 AM | Reply


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