December 15, 2002	Sunday	Shawwal 10, 1423

ISLAMABAD, Dec 14: Sensitive Price Indicator (SPI) declined for the second consecutive week by 0.16 per cent during the week ending December 12, 2002, as compared to previous week, according to weekly price release of Federal Bureau of Statistics (FBS).

Attributable mainly to increased supply of winter season vegetables, the reversal of price trend benefited households below the bottom rung of society with monthly incomes up to Rs3,000. In their case, the SPI dropped by 0.20 per cent.

For the middle level households with monthly incomes in the range of Rs3,001-5,000 and Rs5,001-12,000, it slid by 0.19 and 0.17 per cent respectively. The lowest decrease of 0.10 per cent was in respect of households having incomes above Rs12,000.

The SPI index, at the end of the week under review, stood at 106.75 for all the four income groups, with 2000-01 as the base year.

According to FBS data based on prices prevailing in 17 major towns of Pakistan during the period under review, the prices of 12 out of 51 essential items of SPI basket declined as follows:

Tomatoes (20.15%), potatoes (8.36%), onions (2.96%), banana (1.91%), gur (1.27%), lawn (85%), garlic (0.65%), kerosene (0.27%), mash pulse washed (0.24%), mustard oil (0.21%), sugar (0.10%) and red chilies (powdered) (0.03%).

Thirteen other items of SPI basket recorded further spiral of prices. These included: Egg (farm) (3.66%), chicken farm (2.47%), gram pulse washed (0.87%), moong pulse washed (0.73%), wheat flour average quality (0.69%), wheat (0.57%), mutton (0.56%), masoor pulse washed (0.34%), rice basmati broken (0.33%), cooking oil (tin) (0.29%), beef and vegetable ghee (loose) (0.25% each), and vegetable ghee (tin) (0.12%).

FBS release also included data on the cost of electricity and gas. According to it, highest increase was inflicted on the consumer of electricity up to 100 units per month during the corresponding week of previous year - 16.6 per cent. In absolute terms, the rate was increased by 35 paisa to Rs2.49 per unit.

This contradicts the official statements which justified each of the frequent hikes by saying that it would not affect the poor households. What happened was that the zero hike in respect of users of electricity up to 50 units was compensated by inflating the rate for the 1-100 units slab.

This is in sharp contrast to the price increase for the most affluent households for consumption above 1,000 units. For them, the hike was only of 4.39 per cent - nearly one-fourth the rate for the poor households.

As regards other slabs, the power rates were increased by 11.18 per cent for 101-300 units slab and 6.58 per cent for the households using between 301 and 1,000 units.

In absolute terms, the rate was raised by 35 paisa for the 1- 100 slab - 6 paisa more than the increase on users of over 1,000 units.

The big percentage difference between different slabs occurred because the rates were not revised upward in proportion to the prevailing rate. Instead, the authorities applied the principle of ‘parity’ for the low income people and the richest people.

On the face of it, the authorities administered “equal” treatment to all; in reality, however, it burdened the low income households more by imposing greater pressure on their paltry resources.