Case to watch out for profiteering from water-price hike

Consumer watchdog Case will keep watch on price increases and look into feedback on alleged profiteering.
Consumer watchdog Case will keep watch on price increases and look into feedback on alleged profiteering.PHOTO: ST FILE

The Consumers Association Of Singapore (Case) will keep tabs on whether businesses profit unreasonably from the impending increase in water prices.

Hence, there is no need at this point for the Trade and Industry Minister to set up a committee to look into profiteering, its Minister of State Koh Poh Koon said in Parliament yesterday.

Dr Koh was addressing MPs' concerns that businesses may try to profiteer from the 30 per cent water price hike, which will be implemented in two phases in July this year and July next year.

He said the water tariff, along with the diesel and carbon tax announced in the new Budget in February, are expected to have a moderated impact on business costs.

Different industries will be affected differently.

On average, utilities, including water and electricity, form less than 1 per cent of business costs in most services industries, Dr Koh said. Moreover, consumer watchdog Case will keep watch on price increases and look into feedback on alleged profiteering, he added.

Also, people who want to highlight cases of profiteering can do it through Case's hotline, website or mobile app, or through government feedback channels like its feedback unit Reach, he said.

Reflecting the unease of her residents, Ms Lee Bee Wah (Nee Soon GRC) asked how the Government would handle price increases in neighbourhood coffee shops and hawker centres.

Residents may have no choice but to stomach the higher prices as there are few alternatives to such eateries near their homes, she said. On the price of a cup of coffee, Ms Lee said: "$1 may become $1.15 and then, next July, become $1.30."

Dr Koh replied: "Price increases can happen with or without increase in water price, and businesses do make calculated decisions on how to price their product.''

He added: "Coffee can range from a simple 3-in-1 that you buy as a packet or it can be as expensive as a latte." If businesses raise their prices across the board, "then I think consumers should make their choice and decide who to patronise", he said.

Mr Liang Eng Hwa (Holland- Bukit Timah GRC) and Mr Louis Ng (Nee Soon GRC) asked why Case, and not the Government, was dealing with the issue.

Mr Liang suggested setting up an anti-profiteering task force, which had happened before.

Dr Koh said the task force was in response to an increase in the goods and services tax, which affects all goods and services, and can lead to higher costs in a broad range of areas. It is not suitable for the water price increase that affects certain business segments more than others, he added.

Mr Lim Biow Chuan (Mountbatten), who is Case's president, advised consumers to choose wisely.

He said: "If all consumers... just pay whatever a coffee shop demands, then, of course, you will be supporting arbitrary price increases."

Charissa Yong

A version of this article appeared in the print edition of The Straits Times on April 04, 2017, with the headline 'Case to watch out for profiteering from water-price hike'. Print Edition | Subscribe