The Anti-Poverty Platform and Consumers Coalition have a point (see Friday paper). The decision by Social and Health Insurances SZV not to apply a cost-of-living adjustment (COLA) to social pensions this year raises questions.
It is based on an announcement by the Department of Statistics last August that it would not publish a consumer price index (CPI) for 2018 due to implementing a new data-collection and -processing system. However, prices had gone up by 1.5 per cent during the last four months of 2017, so if that trend continued another 4.5 per cent could have been added during the past 12 months.
Meanwhile, government did allow St. Maarten Medical Center (SMMC) a tariff hike said to be 41.8 per cent in January of last year, even though the final 2017 CPI had not yet been calculated. An estimate was provided for that purpose and the argument is that this can also be done for the pensioners.
If government follows SZV’s lead it probably will mean no minimum wage indexation either. That, despite the latter and the AOV old age pension already being considered rather low.
This newspaper recently warned against indiscriminately raising salaries because businesses usually pass any extra expense on to the customer, driving up the cost of living without really helping the persons targeted in terms of more spending power. There is also the risk of pricing the island and its competitive tourism economy out of the market.
Nevertheless, a small adjustment would have seemed justified for the very lowest incomes, as a show of solidarity if nothing else. To them, even one or two per cent can make a world of difference.
