MAS Said That Prices of Food, Transport, Preschools & Healthcare Expected to Rise in 2022

2021 has not exactly been the year we had hoped it’d be.

We envisioned large concerts, even larger parties, and spontaneous trips to faraway lands. One out of three isn’t bad, but to say it’s been a great year would certainly be a stretch.

Whenever we get to the end of each year, we start harbouring high hopes and great expectations for the next, believing all our problems will magically end and our dreams come true.

But, of course, this never happens.

MAS Said That Prices of Food, Transport, Preschools & Healthcare Expected to Rise in 2022

The prices of food, transport, preschools, and healthcare are expected to rise in 2022, said the Monetary Authority of Singapore (MAS).

Overall inflation is expected to range between 1.5% to 2.5%, which could be higher than the 2% projected for 2021.

This is a rebound from the deflation witnessed last year, thanks to the widespread effects of the COVID-19 pandemic.

As Health Minister Ong hinted at earlier this year, public transport fees could go up. Mr Ong said in March that fare adjustments are necessary as costs do increase, such as the wages of public transport workers.

Subsidies currently in place under the Public Health Preparedness Clinic scheme could also be eased out of service, depending on the severity of our COVID-19 outbreak.

Causes

One of the causes of this projected inflation is growing wage costs which could rise to pre-pandemic levels by the end of 2021. This will happen as the financial support from the government tapers off.

Disruptions to the global supply chain will also drive up the cost of imported products. This disruption will take some time to ease as countries will only open up once their vaccination rates are high enough.

Additionally, the price of imported food is expected to go up due to supply chain and logistical issues.

Since we’re already delivering bad news…

GST Hike Will Still Take Place Between 2022 to 2025

Earlier this month, Finance Minister Lawrence Wong said the government will go ahead with its plans to raise the GST between 2022 and 2025.

The hike – from 7% to 9% – was first announced in Budget 2018, after which COVID-19 threw a rather large spanner in the works.

The need to raise Government revenue, Mr Wong explained, stems from increasing expenditure in areas such as healthcare and social spending.

As for the exact timing of the hike, that will depend on a number of factors, including the prevailing economic conditions and country’s fiscal needs.

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