The cost to live, better known as the cost of living, over the years has reached to a point where it has made of the middle class the working poor and created a larger divide of inequality between the haves and the have nots. There are consistent complaints about the cost of living on St. Maarten. These complaints in many instances are about minimum wage, the short term contracts, high rents, high food costs, utilities, just to name few.
What is appalling to me is how some economists come up with all kinds of creative formulas which according to them is an indication of how the economy is functioning. And based on these calculations determine the price at which goods and services are provided. Let me remind them that one size does not fit all.
It would be interesting at this time to know the consumer price index on St. Maarten or better yet, the increases in the last 5 years. These figures should be readily available at the Department for Statistics (STAT).
I understood a report came out in which it states that on Curaçao a family of 3 consisting of a mother and two children, the minimum wage should be around NAf. 2,000 (two thousand guilders), whereas on St. Maarten it should be around NAf. 4,000 (four thousand guilders). Realistically one would have to agree that an increase of such a proportion on St. Maarten or anywhere for that matter would be disastrous to the economy.
What in my opinion should happen is to look at the feared COLA or cost-of-living adjustments and based on the price increases of goods and services over the last 5 years adjust salaries in specific categories. I am sure this suggestion will be met by much criticism by some. But said increase should not be done across the board.
Persons collecting an annual income of NAf. 48,000 and above should be exempted from collecting the cost-of-living adjustment in the same manner someone earning less than this amount. Let me be clear again unless misunderstood, I am not saying they should not receive the adjustments, but not in the same manner as those earning less than NAf. 48,000 gross annually. The financial experts will have to come up with the formula on how this is to be done.
This brings us to the matter of the basket of goods. Before I continue, permit me to insert a statement I read recently and it goes as follows: “People, have a right to safe and permanent access to healthy food, sufficient and nutritious; preferably produced at local level and in accordance with their diverse identities and cultural traditions,” end of quote. I will develop this in another article.
For a number of years now, mention was made of adding additional items to the list of the basket of goods. What is the status on this? It is critical and requires swift action. Food prices have skyrocketed unabated as control has been ad-hoc to non-existent. What has to be seriously investigated is why this phenomenon. Is it that the department is understaffed, lack equipment, not trained or not able to issue fines?
I asked a question on the floor of the island council sometime in 2005 as to who controlled the importation of goods on the island. In this specific case I was referring to food items. The response by the then-commissioner of economic affairs was, and let me paraphrase, “What do you want me to do, stand in front of the door of every supermarket?” We are talking 14 years ago.
The other issue that needs urgent attention is the matter of rent. The law is over 50 years old. It only authorizes the rent committee to establish the rental income of a dwelling valued at NAf. 50,000. We know for a fact that prices of homes have increased tremendously over the last decades. It is fact that today homes are valued at $150 thousand and up making this law non-applicable.
Some landlords charge their tenant the lowest $500 for 1 room. Let me be clear, I did not say a one-bedroom apartment, I said one room. When it comes to a one-bedroom apartment, you are looking at rents of $700 and upwards. I hope you can understand why many persons are living in deplorable conditions.
The majority of the labor force earn minimum wage of $800 a month. The ones who suffer the most from this are single mothers. I have always heard that your rent should not be more than 30 per cent of your income. Now, where will you find a decent apartment for $240 taking into consideration the minimum wage of $800?
Then we have arguments made by landlords, and rightfully so, that they have to pay the Bank – mortgage/loans incurred when building their homes/apartments. This means a serious discussion with the Banks regarding interest rates, etc. The Banks in turn will argue that their responsibility is to protect the interest of their shareholders. Then our next option would be the Central Bank of Curaçao and St. Maarten. What I am trying to say is that we need all stakeholders to understand the seriousness of the matter and be realistic in our approach.
Finally, I think it is time to introduce the cash registers similar to those formerly used at the Princess Juliana International Airport. I believe they are already in use on Curaçao.
Let us begin with the supermarkets. The fact that the anti-poverty organization can sell 8 lemons for $1 and they only bring in one or two containers, what does this mean for those who bring in many more containers? The cost to live.