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Consumer watchdog to keep eye on profiteering from water, power price hikes
SINGAPORE'S consumer watchdog will keep a close eye on businesses that attempt to make a profit from the increases in the cost of water and electricity, Parliament was told on Monday.
The Consumer Association of Singapore (Case) will monitor price increases and also look into feedback from the public on possible profiteering activities, said Minister of State for Trade and Industry Koh Poh Koon.
He added that Case will step up its education efforts to encourage consumers to "exercise their choice and make informed purchasing decisions"; they can, for example, choose to patronise businesses that continue offering competitive prices and products.
Dr Koh was replying to separate queries by Members of Parliament Lee Bee Wah (Nee Soon) and Liang Eng Hwa (Holland-Bukit Timah), who both wanted to know more about the ministry's plans to prevent businesses from taking advantage of the upcoming hike in the prices of utilities.
Consumers who wish to give feedback on alleged profiteering may do so through Case's hotline, website or mobile app. They could also make use of government feedback channels such as Reach.
There is thus "no need" for the Ministry of Trade and Industry to set up a committee at this point to look into profiteering, said Dr Koh in response to Ms Lee's suggestion to do so.
It was announced at Budget 2017 in February that the cost of water will go up by 30 per cent over the next two years from July.
The government has already implemented a volume-based duty of S$0.10 per litre of diesel. It will also, from 2019, introduce a carbon tax rate of up to S$20 per tonne of greenhouse gas emissions on large direct emitters such as power stations.
Last week, Singapore Power Group announced that electricity prices will cost 21.39 cents per kilowatt hour from April to June 2017, up from 20.20 cents in the previous three months.
Dr Koh described the measures on water tariffs, diesel and carbon tax as "targeted", adding that these are expected to have a "moderate impact" on overall business costs.
He noted that the cost of utilities, which includes water and electricity costs, accounts for a "relatively small share" of business costs for firms in the services sector, at less than 1 per cent on average for most services industries.
"Electricity prices are revised every quarter according to prevailing gas prices, which are indexed to global oil prices. There has been a general decline in our electricity tariffs over the past three years due to low global oil prices. The current electricity tariff is around 16.9 per cent lower than that in the second quarter of 2014," said Dr Koh.
Case president Lim Biow Chuan, the MP for the Mountbatten single ward, took the opportunity to reiterate Dr Koh's earlier point that consumers can choose not to buy from a particular shop if they are not happy with the price.
He made this point after a short exchange between Ms Lee and Dr Koh on whether the price of coffee might go up after July as a result of the water price increase.
"If they just pay whatever the coffee shop demands then they are supporting the price of increases arbitrarily," he said. "Case will continue to monitor prices. In the event one coffee shop raises prices, we would be happy to publicise those that have not raised their prices in turn."
Dr Koh added: "Case, as an organisation that helps educate consumers, plays an important role in helping consumers understand their purchasing power … and to be able to exercise that. That's a good signal to the business community to price their products in a reasonable way."
Dr Koh also gave the assurance that the government will continue to monitor the impact of the Budget 2017 measures on industries, and calibrate its economic-support policies where necessary.
He stressed that the most sustainable strategy for businesses to manage cost increases and stay competitive is to transform themselves and be more productive and innovative.