By Mandana Ismail Abeywickrema

Proof of the battle in the kitchen that has been intensifying over the last two years has now been exposed in red and black as it were, with the revelation that on an average a household in Sri Lanka lives in the red to the tune of Rs. 6,217 per month.

Although the decline in the people's purchasing power due to the high cost of living has been a most talked of topic, the real gravity of the situation has escaped the attention of many.

A Household Income and Expenditure Survey conducted by the Census and Statistics Department has revealed that according to the latest statistics the income of a household in the country is not commensurate with the expenditure. In fact, a household is in the red for Rs. 6,217 each month.

The survey results have revealed the median household income per month for Sri Lanka to be Rs. 16,735 in 2006/2007, which means half of the households in the country have received less than Rs. 16,735 per month per household.

Median household income

District variation of median household income has shown that half the number of households in the Colombo District receive less than Rs. 24,711 per month, while half the number of households in Nuwara Eliya District receive less than Rs. 11,914 per month per household.

According to the survey, the values of median income of all provinces, other than Western Province and Southern Province are less than, that of the national level figure of Rs.16,735.

However, while the household income stood at Rs. 16,735 per month, the average household expenditure has been Rs.22,952 per month for 2006/07.

The survey report states that when residential sectors (Urban, Rural and Estate) are compared, households in the urban sector had spent Rs. 35,274 per month while households in the rural sector had spent Rs. 21,440 per month.

Households in the estate sector had spent Rs.13,456 per month, which is the lowest value among sectors.

Expenditure on food and drink

The survey report has also highlighted the average monthly household expenditure on food and drink, and non-food items by province and by district.

It has been revealed that households in the Western Province had spent Rs. 31,437 per month while households in the Uva Province had spent Rs.15,886 per month.

A comparison of the districts have shown that the highest mean household expenditure was from the Colombo District, which stood at Rs.37,011 per month, while the lowest mean household expenditure was reported from the Moneragala District, at Rs.13,155 per month.

Of the total expenditure value of Rs. 22,952 per month per household, 37.6% or Rs. 8,641 has been spent on food and drink while 62.4% (Rs. 14, 311) has been spent on non-food items.

According to the survey, apart from food and drink items, a household on an average spends Rs. 2,639 on housing, Rs. 1042 on fuel and light, Rs. 1862 on transport, Rs. 980 on personal care and health expenses and Rs. 632 on education.

 Health and education

Interestingly, the amount of money spent on health and education has been overtaken by housing, electricity and transport costs.

Statistics have also revealed that the country has recorded the highest increase in the cost of living index between 2005 and 2007.

The working masses on many occasions have pointed out that the cost of living index that was 4304 in January 2006 has increased to 6527 by April 2008. This 2223 point increase in the cost of living index they say is reality and could not be changed by the government by simply changing the index and introducing a new one that understates the figure.

According to some worker unions, the cost of living has increased to such a level that a minimum Rs.30,885 a month is required to maintain a five-member family.

"The index has gone up by 2000 points since 2005. If Rs. 2.20 is given for each point the salaries of public servants should be increased by Rs. 5,000 a month," they say.

90% of earnings spent on food

A senior trade union activist speaking on the plight of the country's working masses given the high cost of living said that according to surveys conducted on the expenditure pattern of the people, 90% of the earnings were spent on food.

He said that due to the increase in prices, 90% of the earnings had to be spent on food while only 10% was left for other expenditure like electricity and water bills, transport costs, etc.

The same survey in 2003 had revealed that 50% of the income was used for food, and the remaining 50% was used for other expenses.

He also added that according to the Department of Census and Statistics, a family of five now need Rs.30,885 per month to survive, a fact that has now been proven through statistics of the Census and Statistics Department.

"The amount needed has been calculated as Rs.30,885. But the present minimum wage of a public sector employee is Rs.11,730 and a private and estate sector worker is Rs.5,000," he said.

The income disparity

However, the income disparity among the working masses themselves is another issue altogether. While the public sector workers seem to have received wage hikes in some form or other , the private, estate and even the self employed sectors are the worst affected, recording almost no increase in their earnings for the past two years.

The private sector consisting of a work force of 6.5 million persons, has not recorded a positive wage increase despite the sharply rising cost of living.

Private sector employees have pointed out that while the public sector employees receive a minimum salary of Rs.11,730 and the total salary amounts to Rs. 14,500 with the cost of living allowance, the minimum salary of the private sector stands at a paltry Rs. 5,000.

It has been calculated that while 75% of the country's work force is employed in the private sector, their contribution to the national economy amounts to more than 80%.

If the plight of the private sector workers is considered bad, then the estate sector is even worse.

The estate sector that contributes nearly 15% to the country's economy has been one of the most deprived sectors for years.

Estate sector

According to estate sector trade unions, over 400,000 workers are employed in the sector while the total amount of people dependent on the sector amounts to a massive 1.3 million.

The unions explained that the basic salary of an estate worker was Rs.200 per day while it is increased to Rs. 290 per day if the employee works for 25 days. "Most often, they don't get this Rs.290," they said.

While the last wage hike granted to the estate workers was in 2006, according to an agreement signed between the estate workers and the owners the agreement was due to be renewed this year, but has been now postponed to next year.

Since November 2005 the country has 'achieved' a sky-high cost of living and a level of inflation unmatched by any other country in Asia.

With the budget for 2009 just around the corner, all eyes are now turned towards it in the hope of some relief.