Saturday, March 29, 2008

NTUC : Stores for the poor!

You might think that NTUC Fairprice is a store setup for all Singaporeans but apparently some Singaporeans are now so poor they cannot afford to go to NTUC. NTUC is now setting up stores specially for the poor (see report below).

I've known that for some time as the A-B-C thrift shop near my place is thriving because people are feeling the squeeze due to inflation. For $1, you can get a pack of 48 batteries from China:I found out that they leak and might damage the appliance - but I didn't throw them away, I added a layer of masking tape contain the leak. I'm not poor, I'm a cheapskate. I'm sure the poor people who buy cheap stuff like these batteries know what to do. Other cheap things you can get from thrift shops are parallel imports of branded items that are made in Thailand - these include shampoos, toothpaste etc. I heard about this but don't know if it is true, the Thais have a ban on the import of such products and these companies have to set up shop in Thailand to manufacture their products if they want to sell them in Thailand. I'm alright with the toothpaste from the thrift shop, as long as it is something I don't have to swallow, I'm okay with it.
Many Singaporeans are rich enough not to have to buy from thrift shops. You're not poor - you don't have to risk buying cheap stuff that don't last. It is difficult to understand what it is like to be poor's a real story for you from a page in my life:

More than 30 years ago, I stayed in a kampung (a village). It was quite common to do so and I didn't really consider myself poor - my dad spoke some English and had a steady job and we could afford all the necessities and some creature comforts like a TV. The kids staying opposite us weren't so lucky - the dad had a low paying job and found it difficult to make ends meet. The parents quarreled often over money (or rather the lack of money) - it was a struggle to clothe and feed the children. One of problems with the family was they had too many children - 5 kids. that time our govt had disincentives for parents having more children and that made their situation worse. One day when I got home from school, I found one of the neighbors children crying outside the house. I asked him what happened and he told me he was punished physically for dragging his feet while walking. Dragging his feet? You see the family was so poor they punished the kids for dragging their feet because it caused the shoes to wear out faster. That was the kind of poverty we had 30+ years ago when we were a developing country. People actually struggle to pay for necessities. Over the next 2 decades, poverty actually decreased as wages rose relative to the cost of necessities. However, 10 years ago, it started rising sharply again.....and last week's announcement by NTUC to set up shores for the poor means that the number of low income families has risen to the point that NTUC now sees a business opportunity to cater this growing segment of our society. NTUC Fairprice is living up to its reputation that it serves that every Singaporean, just that the poor have to be served at a different outlet.

In a affluent nation with a sovereign fund that can inject and lose several billions injecting money into trouble western banks, there is really no need for such "shops for the poor" and thrift shops because we have all the resources to alleviate the problem of poverty by paying fair wages - a person working full time should be able to raise his family and at least afford the necessities.... but wages aren't rising as fast as bus fares, electricity prices, rice etc. A good govt isn't one constrained by practices of governments elsewhere that their own remuneration is somehow related to the well being of their citizens. Ours is a good govt if not the best in the world, they are able to break out constraints and address the injustice of their own painful sacrifice to be in govt by raising their own salaries in a hurry while they retrain the low income earners to accept the new harsh reality of their situation. There is no hurry to hold back the increase in electricity tariffs, no hurry to give out food stamps before someone starved to death, no hurry for welfare before another citizen gets onto the MRT tracks and no hurry for health care for those who can't afford it. The PAP govt is known to work with much haste when it needs to protect its reputation - Mas Selamat shows that no effort and resource will be spared when competence of the govt is called into question. Poverty is however a silent problem that shows up quietly in various numbers such as the GINI index and income distribution...and the poor people who know our illegal assembly laws well and they have no voice or power to change anything. If the problem is managed away quietly, it will exist but remain hidden behind the grand achievements of our great govt. In the coming months there is plenty to celebrate - the F1 will be here in Singapore, the casinos (oops IRs) will open and youth Olympics will held in Singapore. This country is about staying together and moving ahead. moving ahead, we leave nobody behind, so make sure you're not a nobody who can't afford the price increases our govt has planned for you...



NTUC may set up stores with cheaper items for the low-income
By Wong Mun Wai, Channel NewsAsia Posted: 24 March 2008 2051 hrs

SINGAPORE: NTUC FairPrice may set up new stores or have special corners at its current stores to stock cheaper items for the low-income group.

At the launch of the NTUC FairPrice Foundation on Monday, the co-operative said this could be one response to rising food prices, and it is still studying how feasible this will be.

NTUC FairPrice Foundation chairman Ng Ser Miang said: "Because of (the) rising food prices, we are looking at whether there is some effective way where we can set up another format that would serve the low-income group. Or we will take a different strategy of (assigning)... one section in our current format that will serve (them)."

Details have yet to be confirmed, but new stores or facilities could be set up as soon as next year.

"Depending on how fast we can sort of (make) a decision on the right mix of products and the right type of stores we should be going into," Mr Ng said.

The supermarket chain is pledging S$50 million over the next ten years to its foundation.

To mark the launch of NTUC FairPrice Foundation, it is giving S$1 million to four beneficiaries - the Community Chest, the Eldercare Trust, the Food from the Heart and the NTUC Childcare Bright Horizons Trust Fund.

The NTUC FairPrice Foundation said in future, it will issue grants to organisations only if they have three strategic thrusts - to help the poor and needy, to help in nation building and community bonding, and to advance the welfare of workers. - CNA/ac


Anonymous said...

NTUC have proved that more people are poorer than 10 years ago and poverty is raising. We have become the World Class Poor.

Anonymous said...

wife bought one of those housebrand detergent. but alas, she said she had to pour more of it to get the same level of concentration so there was not savings in the end.

Anonymous said...

Lucky, 48 batteries for $1, they leak but you still use them.

You just leaked out the secret of how you became a millionaire!

Hahaha, this is better than 'Just for Laughs' on TV.

Anonymous said...

A salary of $30,000 annually in Singapore is considered "well-to-do" and yet these people have problems making ends meet, such as paying for HDB, etc. What about those who earn less? Who is looking after us?

Anonymous said...

A really great divided !
So next time, we have bank for the rich, and another bank from same coffer for the poor.

Bread for the rich, another bread for the poor.

Anonymous said...

NTUC has just said it will increase the price of rice by as much as 10-15%. You know, as much as it would like to help, it can only do so much. We should be thankful it has already helped contain the inflationary pressure of the staple for the past few months. Continuing to absorb the price increase to help the poor is just NOT FAIR. Very UnFair.

Anonymous said...

You score full A's and do NS.

Foreign talents from china take Singapore scholarship and study in Ivy League's.


I say fuck the system, before it fucks you more.

Onlooker said...

Come to think of it a union is suppose to fight for the welfare and benefit of it's union member.
Can this entity be even considered an union?
More similarity to something like Wal-mart and other for profit entity that is coincidentally anti-union.
A wolf in sheep's skin.
That is also why a lot of local worker(protected livelihood) tends to stay on in their host country and emigrate there.

Anonymous said...

I am a cheapskate too... But that $1 pack of 48 battery is really bugging me, how is that possible? Or rather, how did that happen? And why shouldn't I buy it?

It reminds me of the story, "I, Pencil" written in first person (Seek Google and you shall find). But in brief, it's a quaint story about the workings invisible hand. Haven't brought a pencil for a long time, but I recall it cost $1 for a box of ten, also Chinese made.

But my point is, it shouldn't be so cheap but the fact that it is on sale for a measly $1, it is that cheap! For the value it is sold for, I believe it hides a lot of cost, both measurable and immeasurable.

It is only a dollar, why put much thought to it? But think, how do you justify that dollar? Ask a person does he or she wants a $2 meal for half price, ask another would you buy a $10 T-shirt with 10% off? Or say you're getting a $100 fountain pen, and the saleguy tells you there's a 1% discount.

For that dollar you save, the more you realise what you're really paying, the less significant it becomes. For the insignificant dollar you pay for the pack of batteries, the price becomes unjustifiable with such unsustainable cost on finite resources, much like the big picture in that quaint little story.

Not that I am holier than thou, see that if you were to purchase a $10 pack of 4 AA rechargeable, of the NiMn kind, it will easily last 1,000 recharge, cost per use? 0.25 cent. And next time pay attention to the label on the battery, there's this little symbol of a trash bin with a cross against it.

So what do you think? Just my opinion, worth nothing more than one of those Lucky AAs :D

LuckySingaporean said...

anon 7:23am,

I tell you how $1 for 48 batteries.

You see in China they have a strange system where members of the communist party run various districts etc and are responsible for the growth in those areas. Then there are banks, factories, workers etc forming part of this system. You see the real subprime stuff is in China not US. Every year the Chinese govt spend US$300-400B to buy up the bad debts of banks so that they are recapitalised annually....and can continue lending the following year. What is happening is these communists running the Chinese economy haven't fully figured out all the nuts and bolts of the capitalist system....and have no idea how the system will evolve in the coming decades.

So what has that got to do with $1 for 48 batteries. You see many chinese companies borrow money to keep their factories going regardless of demand. Jobs are maintained, workers are hired and the communist guy running the show is happy. When goods are produced and nobody wants it because it is crappy unbranded stuff they are dumped at a loss, ...these things make their way into our thrift shops from the Chinese sweatshops. Not just batteries, MP3 players, shoes, ....not only they are dumped at a loss - the pricing is killing legitimate better run chinese companies.

The economists have this saying - whenever something cannot be sustained it has to come to an end. The Chinese will see its most glorious event in the form of the Olympics - that will somehow I suspect mark the height of their achievements - you can't run a capitalistic economic system over a communist system for too long - the system is bursting at the seams - not just Tibet but China has hundreds of riots and this is reported official figures due to underpaid workers, land grabs, outright starvation, corruption of local GDP growth mask many social problems. It is when the tide is out, when you know who is swimming naked - the real subprime economy is in China not USA.

Anonymous said...

What Lucky just said about China is alarming but true especially in regards to their national banks. Subprime in China, now that's not often talked about probably because it has been going for too long :-).

China's state-subsidized goods extent also to air tickets on Chinese airlines for tours to China. According to one tour agent they are sometimes FOC for Sinapore tour agencies because the Chinese govt wants to actively promote inbound tourism.

Chinese goods are known to be crappy if you fail to carefully check them out. But sometimes how to check when you buy for instance a pair of apparently good sandals ... and then only to have its soles drop off and you find there was only a few drops of glue on it. Really hilarious.

But all said, to be fair we have to thank China for cheap goods, many of which are in good conditions.

Furthermore China is a vast country and its problems are legion. One foreseeable huge problem is the aging population, in the face of its 1-child family.

China as a civilization has gone through too much trouble and its people by hook or by crook cannot afford to see the country fail. It's too frightening.

I have faith in the Chinese spirit, its determination to make good under the most trying circumstances. What China is today was an impossible dream 40 years ago under the Marxist economic system.

Lets hope China well, if only because the fate of Singapore and world is intertwined with it.

Anonymous said...

I think NTUC has totally lost their objectives of beginning here in the first place.

Back in the 70s, there was a petrol crisis and price of food stuff went up, to stabilize price and make food stuff affortable NTUC opened its first super market in Toa Payoh.

Thoughout the years they open more and more super market, taxi service, insurrance service and many more you can think of - The objective; stabilize price and keep them affortable, but look at it now they’re more like a money marking “co-op”.

You likely can get better and cheaper stuff in some other shops or super markets.

They've totally lost their objective, that why they need another store for the poor.

Who know, in another 10years time we may have Liberty(for the rich) Fairprice(for the ave), Thrift (for poor) Beg(for those who can't afford).

Anonymous said...

So, NTUC absorbs unwanted inferior goods from China's backyard at a cost lower than S$1 and dumps it on the Singaporean consumers with some cheap profits?

Anonymous said...

How about Harvey Norman? Will they be setting up a store for the poor? Singaporeans needs Harvey Norman badly!!!!!!!!

Anonymous said...

According to this news report on 24 Mar 2008, NTUC FairPrice made 6.3% or $100 million in net profit out of a revenue of $1.6 billion in 2007.

Is this 6.3% net profit margin the norm for cooperatives? I do not have much international data to compare but I nevertheless found that The Midcounties Co-operative, the fourth-largest cooperative in the UK involved in similar businesses like FairPrice, only made 3.6% or £15 million in net profit out of sales of £421 million in 2005.

Apparently FairPrice is 75% more profitable than the latter. It begs the question whether FairPrice is charging consumer cooperative prices.

One can interpret the difference in net profitability by saying that FairPrice is more efficient than Midcounties Co-op. However I doubt this large difference can be explained thus.

In any case, the real point is that FairPrice should follow some international benchmark on cooperatives in the area of profitability. If it is making much more, then it should lower the prices of goods so that its profitability will reflect its cooperative nature.

I found another report based from the The Competition Commission (CC) of UK which helps ensure healthy competition between companies in the UK.

On the subject of profitability of groceries (supermarkets) chapter 8, their average operating margin (which I believe is pretty close to net profit margin) is only 5.5% - 5.6% for year 1998 - 2000. - LINK

These supermarkets are commercial, yet their profit margin appear less than that of NTUC FairPrice.


To return to the news report in the 1st para on FairPrice $50m donation to charity. That's actually for 10 years. It has donated $1 million for now and that is only 1% of its net profit.

This how generous a cooperative set up in the name of ordinary workers is.

The rest of the money goes to where? Some of it may be to Singapore Labour Foundation run by PAP - apparently very secretive, if you care to visit that site. You can't get a proper financial report which its 'Annual Report' link purports to !

SLF has a big building in Thomson Road and is probably manned by many pappies doing next to nothing in there.

How much money is in there and how is it managed? Who knows?

yamizi said...

I just wonder will staffs at these NTUC thrift store give its customers that kind of discriminatory glare to further hit their self esteem living in this ever-hard-to-catch-up society?

Anonymous said...


Anonymous said...

PAP has always condemned state welfare because it claims that it bankrupts those nations that practise it. I would suppose those nations, mostly European, must have disappeared from the face of the earth since.

Surprise, why are they still around and kicking: Denmark, Sweden, France, Germany, Belgium ... a long list to be found here.

PAP also claims that state welfare makes people lazy and unproductive; they will not work nor develop themselves knowing there they can always go for state's sponsored social security like monthly dole and healthcare.

Surprise again, in the same article based on data that have not been challenged so far the following statement is found: "Overall, there is a slight positive correlation between increased spending on social services and higher GDP per capita as well as higher HDI (Human Development Index) rating". In fact I do not find the positive correlation (based on the provided chart) slight but rather significant.

Then there is another PAP's anti-welfare argument that says in welfare state the income tax can go as high as 50% of one's income. In Singapore the income tax is low.

Sure, and that is because the argument failed to mention that CPF contribution amounts to around 36% (20% from employee and 16% from employer) now and in the past as high as 50%.

This is the equivalent of income tax because it is going to be used for social security in old age.

The only difference is that in state welfare, the government takes the money in the form of income tax, invest in wisely and assures the people that on retirement they will be looked after in terms of their monthly expenditure, healthcare and such.

On the other hand, the PAP thought its CPF system was so much superior than state welfare.

However in doing so, PAP had not only assumed the role of the custodian of CPF savings but had set up huge conglomerates like Temasek and GIC to invest the money. And it has failed to deliver because it been been underpaying interest rates to the tune of at 2% annually.

Check out this 2% difference based on Singapore and Malaysia interest rates for such a similar system at this site - LINK.

Furthermore the CPF saving scheme has now proved insufficient as a social security for the whole population, such that PAP is now implementing another measure - a collective annuity scheme - to fix the problem. But I fail to see any solution in that scheme. This has been addressed by Lucky in a previous article and comments in the messageboard.

That said, state welfare is a dirty word to PAP also for another reason. PAP does not want the people to consider being looked after by the state as a citizen's right or even privelege.

PAP wants needy people to have to seek and beg from it. For this reason people not only have to apply formally for the handouts over the years, but for some handouts they even have to glean the information from press reports in order to do so. If they so much as miss an annoucement, they would lose out.

This even though PAP knows full well that many needy people precisely come from the old, infirm, bedridden, illiterate group of Singaporeans who do not usually follow the news closely nor are knowledgeable enough in filling forms or where to get help.

But PAP insisted and still insists these people must know how to apply for the handouts. And as a result I believe based on my observation many of these needy people never get to receive the handouts.

See how heartless a government Singaporeans have.

All this has to do with the PAP's objective of creating indignity out of neediness. For in this way PAP hopes that people would not be motivated to be so dependent on the state. Shame them in other words.

However contrary to PAP's sick and misguided thinking, people in the most generous of welfare state have been found to be some of the most productive in terms of GDP and HDI.

Anonymous said...

"However contrary to PAP's sick and misguided thinking, people in the most generous of welfare state have been found to be some of the most productive in terms of GDP and HDI."

my gut tells me there maybe some truth in that. but of course, being led by a willing spirit alone when the flesh is strongly demanding and oppose to grace is not something a capitalistic establishment can easily concede to

it takes faith to give sacrificially( considering graciousness will somehow be abused at times etc) and even more faith to expect a better return( investing in humanities) in the long term.

unfortunately, faith is not taught in the finest and proudest universities

and where faith found and practiced, most leaders have one hand lifted towards heaven and the other hand hidden in their swelling pockets.

yamizi said...

Anyway Lucky,

It will not be surprise that the stuffs that will be selling at NTUC thrift shop will be more expensive than the real thrift shop outside?


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