Fiji Labour Party Leader, Mahendra Chaudhry has challenged the inflation figure for January this year however Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says Chaudhry is twisting the figures and misleading the people and this is not surprising.
Chaudhry says Professor Prasad’s claim that the inflation rate in January was down to 3.7 percent, rings hollow to the general shopper for whom the price of goods on the supermarket shelf, and almost everywhere else, continues to rise.
Chaudhry says there is no real correlation between the inflation figures stated by the government and the increasingly high cost of living the ordinary family is struggling with.
He says whatever the inflation rate, 4 percent or 13 percent as claimed by an independent economist, the point is that the already high cost of living has soared sharply with the increase in VAT to 15 percent and higher duties imposed on imported food products and other items in 2023-2024 national budget.
The former Prime Minister says to retain his credibility, Professor Prasad needs to move urgently to reset the components and weights of the Consumer Price Index so that it provides a more realistic picture of what’s happening on the ground.
He says the hard reality is that the Coalition has not met its election promise to provide relief by bringing down the cost of living.
Chaudhry says, on the contrary, taxation measures adopted by the Finance Minister have made matters worse for the ordinary family.
He says nor has government moved to fulfill its promise to raise the minimum wage rate and no real effort to tackle this issue has been taken since taking office 15 months ago.
The FLP Leader claims the high cost of living is hurting the economy because consumption is down.
Chaudhry says people are spending on essentials and businesses are complaining that sales are down by as much as 30 percent in some cases.
While responding to Chaudhry's statement, Professor Prasad says Chaudhry quotes the Bureau of Statistics and the Reserve Bank of Fiji when it suits him but when the RBF says that the annual headline inflation rate fell to 3.6 percent in January from 5.1 percent in December and is forecast to fall to 3 percent by the end of the year, notwithstanding any commodity price shocks, Chaudhry uses that to attack the government because he does not believe the figures put out by these authorities.
Professor Prasad says Chaudhry never talks about what the government has done over the last 12 months in terms of supporting the poor and the vulnerable right from the day they came into government and he also forgets that the government kept zero VAT on basic food items and added prescribed medicine to the list.
While responding to Chaudhry’s comments regarding the Consumer Price Index, Professor Prasad says Chaudhry knows the government has already said that the Bureau of Statistics is working on it and this is again a very dishonest call.
He says reviewing the CPI is a very natural thing to do for any country when the basket of goods for the Consumer Price Index is determined has not been revised for a long time because consumer patterns change.
The Deputy Prime Minister says the review of the National Minimum Wage rate is underway and the new rate will be announced during the national budget and adds that Chaudhry knows this very well.
While responding to Chaudhry’s claims that the high cost of living is hurting the economy because consumption is down, Professor Prasad says Chaudhry is just making big claims and knows there are a number of factors that can lead to a reduction in consumption.
He says sometimes this is periodic and Fiji’s revenue collection last year compared to 2019 speaks for itself so he does not know how Chaudhry is making this assumption.
Professor Prasad says Chaudhry is trying to hoodwink the public about what is happening in the economy.
He says the government understands what is happening with respect to migration and how consumption patterns may differ from month to month and you cannot pick one month’s figure and start projecting what might happen in the following so it is a bit disingenuous on Chaudhry’s part to make a wild assumption on what is happening in the economy.
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