The Hindu : Tamil Nadu News : A tale of three families in Erode and the 7.33 per cent problem

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Monday, Apr 28, 2008
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Tamil Nadu

Tamil Nadu

A tale of three families in Erode and the 7.33 per cent problem

Kathik Madhavan

Stagnant income, erosion of savings and postponement of plans are some of their woes

‘Charcoal cost has gone up by 66.6 per cent and washing powder by 33 per cent in six months’
‘We have been unable to save and have used our savings to meet expenses’
‘I have cut down weekly hotel expenses and also done away with monthly outing’

The Bharathi Family

The Krishnan Family

The Muthuswamy Family

Monthly Income:

Total: Rs. 4,000

Expenditure:

Rent: Rs. 700

Groceries: Rs. 2,000

Medicine, others: Rs. 500

For the four-member Krishnan family, the price rise could not have come at a worse time.

“The cost of charcoal has increased by 66.6 per cent and washing powder by 33 per cent in the last six months,” says S. Krishnan, a laundry unit operator.

While the cost has escalated, his income has remained the same for the past three years.

“I continue to get the Rs. 2 a piece for washing and ironing that I got three years ago,” he says.

There is more to the laundry operator’s story. Mr. Krishnan was so far engaged in washing and ironing clothes for students of a school in Erode.

Now with summer holidays on he will have to look for customers elsewhere.

“Summer holidays are a terrible time for us because the inflow of clothes is bad. We look for customers in houses and that is hard to come by as people prefer a known laundry operator to a new one,” says his wife K. Muthulakshmi.

The price rise of charcoal and washing powder has forced the family to buy rice in instalments.

“Until recently, we bought rice once in three months - a 75-kg bag at Rs. 1,750.

“Now we buy five kg every week because we are unable to save Rs. 1,750 in three months,” says the woman of the house.

Mr. Krishnan adds that in the past couple of months, the family has had more of a hand-to-mouth existence as house rent, groceries and medicine expenses alone take away about Rs. 3,200 of the family income of Rs. 4,000.

Monthly Income:

Total: Rs.10,000

Expenditure:

Rent: Rs. 3,000

Fuel: Rs. 2,000

Groceries: Rs. 3,000

Medicine and others: Rs. 1,500

In the past couple of months, A. N. Bharathi’s family of three has saved nothing.

“Until a few months ago, we saved Rs. 1,000 a month. Now, not only have been unable to save but also used the savings to meet our expenses,” says the head of the family.

He works as LIC and postal agent. The family has begun cutting down expenses.

“Eating non-vegetarian food has come down from every fortnight to once a month,” says Mr. Bharathi’s wife Radhamani Bharathi, an Erode Corporation councillor.

Ms. Radhamani has also cut down gingelly oil purchase. The family earlier bought 1.5 litres a month at Rs. 170 a litre.

It has now come down to a litre. This is not all the family is doing to meet the challenges of price rise.

Mr. Bharathi says his use of two-wheeler has come down drastically.

“I have started using public transport and within the locality I prefer walking, he says.

“This is to reduce the monthly fuel bill of Rs. 2,000. The family has compromised on rice meant for idly as well.

“Since the price of idly rice has gone up to Rs. 21 from Rs. 16 a kg, I’ve switched over to broken rice (kurunai),” Ms. Radhamani says.

Likewise, the price rise has forced the family to use buttermilk and not the regular curd.

Despite all the price reduction measures, the family ends with a deficit budget of Rs. 2,000, the head of the family says.

Monthly Income:

Total: Rs. 50,000

Expenditure:

Fuel: Rs. 2,500

Milk and vegetables: Rs. 2,360

Groceries: Rs. 15,000

Maid: Rs. 1,500

Education: Rs. 2,000

Others: The rest

The Rs. 50,000 a month income has not insulated A. Muthuswamy and his family from price rise.

“I have cut down on the weekly hotel expenses and also done away with the monthly outing to save fuel expenditure,” says the owner of a textile printing factory.

This is despite him having an auto gas kit for his car.

“The cost of gas too has gone up from Rs. 24 to 37 a litre,” he says.

He adds that he plans to switch over to a diesel vehicle.

M. Leelavathy, his wife, says the monthly household expenditure has gone up by 25 per cent. This is in spite of the family spending judiciously.

The once-in-three days vegetable expenditure has gone up from Rs. 150 a couple of months ago to over Rs. 200, says Mr. Muthuswamy, who heads a family of six including his son’s.

The escalation of cost of milk, groceries and electricity bill has forced the businessman to postpone construction of a shopping complex.

“The decision to postpone the construction has also to do with the rise in prices of steel and cement,” he says.

Mr. Muthuswamy says he is now thinking of selling lands to build the shopping complex, as the building estimate has surpassed the savings meant for the purpose.

Ms. Leelavathy says the family feels the pinch more in milk, vegetables, pulses and rice.

Price rise of fruits is particularly bad, adds Mr. Muthuswamy.

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