How much income households need for a basic standard of living is an important question for society and a major field of study in social research. We published the first study on the cost of a basic standard of living in Singapore using the Minimum Income Standard (MIS) method in 2019, focusing on elderly persons aged 65 years and older, and single adults aged 55–64 years old. A follow-up study on working-age households was completed in 2021. This report presents the latest MIS budgets after adjusting for inflation between 2020 and 2022—also known as uprating.
The increases in MIS budgets take place against a backdrop of recent high inflation: 8.6% between 2020 and 2022 as measured by the Consumer Price Index (CPI). The monthly MIS budgets for three indicative household types increased by 4%–5% during the same period, to:
- $3,369 for a single parent with one child aged 2–6 years old
- $6,693 for a couple with two children aged 7–12 and 13–18 years old
- $1,492 for a single elderly person 65 years and older
This page provides a brief introduction to some key findings. For more detail, please see:
- Full report
- Living wage
- Online calculator – Enter details of a household with parents (single or partnered) and 1-3 children aged up to 25 years old, and see the household budget they would need to meet their basic needs, including a breakdown of the budget.
How were the budgets uprated?
Since the household budgets were first established, they have been periodically uprated to capture the impact of price inflation. The key principles guiding the uprating process are:
- For most retail items—such as household appliances, toiletries, clothing and food—prices were updated according to the 2022 CPI.
- In the MIS study, some items in social participation were expressed in terms of their purpose rather than specific things, and so did not have a clear match in CPI classification. Examples are hospital visits and birthday gifts. These were therefore grouped according to the type of goods participants said were most likely to be purchased for that purpose, for instance, fruit for hospital visits and toys for grandchildren’s birthday gifts.
- For specific components of the budget involving public services where actual price changes were known (e.g. utilities, public transport, school fees), or new services and subsidies had been introduced (e.g. permanent GST Voucher for service and conservancy charges), the costs were revised precisely based on the published rates instead of the CPI.
- Housing costs were revised based on actual prices in the latest launches of new flats, resale flat transaction data and rental statistics.
Are the increases in the MIS budgets comparable to inflation levels?
The MIS budgets have not changed at the same rate as the CPI because the two measures are based on different baskets of items and our uprating process draws not just from CPI data but also specific item prices. Still, across most item categories, the MIS budgets closely followed changes in the CPI. The most significant divergences were for transport; housing and utilities; and educational services.
- The CPI for transport includes both private and public transport. Overall, transport costs increased by 26.7% between 2020 and 2022, consisting of a 32.8% increase for private transport and a 9.0% increase for public transport. But as MIS households rely entirely on public transport and do not own private vehicles, the growth in transport costs within the MIS budgets are much milder (4%–9%), covering items such as Adult Monthly Travel Cards, School Smartcards and occasional taxi or private-hire car rides in emergencies.
- In the CPI, the housing and utilities category consists of two components: accommodation (e.g. imputed and actual rentals, management fees for private housing) and utilities. These increased by 5.7% and 14.6% respectively between 2020 and 2022, or 6.7% on a combined basis. Compared to the CPI, the single parent household’s housing and utility costs within the MIS budget saw a significantly larger increase (12.1%). This reflects higher BTO flat prices, which increased by 9.9% for 3-room BTO flats during 2020–2022.
- The CPI for education includes tuition and other fees (e.g. childcare and school fees), and textbooks and guides. This rose by 3.4% from 2020 to 2022, whereas the same category in the MIS budget fell by 7.0%. The fall in educational costs for the single parent household is due to a change in monthly childcare fees from $770.40 in 2020 to $734.40 in 2022.
Have wage changes helped households to achieve a basic standard of living?
Compared to the distribution of actual work income per household member in Singapore, the MIS budgets are close to the average of the third decile group (i.e. 21st to 30th percentile), meaning that around 30% of all working households earn less than the amount required to meet their basic needs.
Wage inequality in Singapore is stark, whether it is across occupations, types of work or educational levels. Between 2020 and 2022, income gains helped to narrow the distance with MIS budgets for some groups of workers. But these gains were insufficient to alter the overall picture of wage distribution and adequacy.
- The median work income of cleaners, labourers and related workers is now 52% of the MIS budgets, compared to 48% in 2020 (Ministry of Manpower, 2023a). The median work income for service and sales workers also rose from 73% to 80% of MIS budgets. Nonetheless, in both cases, the gap with income needs is still considerable.
- Despite a 19% increase in median work income, casual workers’ earnings still fall 38% short of the MIS budgets, while the income of permanent workers grew from 154% to 167% of MIS levels.
- By educational level, income growth was greatest for workers at the two ends: 13% for those with below secondary education and 10% for degree holders. Even so, workers with less than secondary education are about one-third short (67%) of the MIS budgets.
Have public schemes helped households to achieve a basic standard of living?
Between 2020 and 2022, the income limits and amounts of support under the major transfers and subsidies for children’s care and education remained unchanged as the MIS budgets increased. As a result, households would have found it harder to qualify for support and the amounts of assistance would have been worth less in real terms. Support generally tapers off as children grow up. For instance, infant care subsidies are equivalent to 2%–35% of the working-age households’ MIS budgets, while student care subsidies cover just 1%–7%.
Under the Central Provident Fund (CPF), small increments to the Basic Retirement Sum (BRS) and Full Retirement Sum (FRS) did not make a significant difference to the adequacy of retirement income. Payments based on the BRS cover around 55% of the single elderly household’s MIS budget, while FRS payments are roughly equivalent to basic needs. The BRS and FRS are targets—not actual savings. In practice, only 65% of active CPF members who turned 55 years old in 2021 achieved these amounts.
For older people on low incomes, the inadequacy of ComCare Long-Term Assistance remains striking. It pays 43% of what a single elderly person requires for basic needs and is given to just 0.6% of the elderly population—down from 0.9% in 2020. The Silver Support Scheme, unchanged between 2020 and 2022, reaches more recipients but provides just 10%–20% of the MIS budget.
The GST Voucher – Cash which targets lower-income households is equivalent to just 1% of the MIS budgets for working-age households and 2% for the single elderly person. Actual payment amounts are not regularly disclosed for ComCare Short-To-Medium Term Assistance. The median amount of assistance last reported in 2021 is equivalent to 7%–15% of the working-age households’ MIS budgets.
In the 2023 national budget, the government announced a slew of one-off measures to absorb some of the impact of inflation and the GST rate hike. While there was a wide variety of schemes covering almost all Singaporean adults and households, the total amounts provided over the course of the year add up to a maximum of below 5% of what the single parent household needs, and less than 4% for the partnered parent household. Clearly, they will not significantly alter the outlook for income security.