Business | Economy
It's all getting a bit much
The latest YouGov-Siraj/Gulf News survey reviews the cost of school fees and whether the rent cap law has been effective. It's a tale of woe
- By Gaurav Ghose, Staff Reporter
- Published: 23:34 May 3, 2009
- Image Credit:
- Illustration: Ramachandra Babu/Gulf News
The growth story of the UAE is intact. But beneath the sheen of this phenomenal development lie some disturbing trends manifested in significant economic hardships faced by many of its participants.
Rising living costs are increasingly becoming a burden on families, particularly with schoolgoing children, and impacting their outlook and plans.
Click here to see the survey results (pdf)
Residents' attitudes towards school fees and rents, twin issues affecting most families, in the latest YouGovSiraj-Gulf News Poll, lend ample evidence to the view that the financial strain is being strongly felt by a majority. But it is Asians and those at the lower end of the income scale who appear to be the hardest hit, illustrating a socio-economic divide.
The survey was conducted on September 16 and 17 and the sample size was 653 UAE residents.
The overall average for school fee increases over the past year was 14 per cent, the survey found. In the largest category, 29 per cent of respondents across nationality and income groups state that fees increased between 11 and 20 per cent in the past year.
That rents have risen across the UAE is not news any more. But in Dubai, where a rent cap law of 15 per cent was passed to curb big rate hikes, about a third report that landlords have not complied with it.
School fees
As a result of high school fees, not surprisingly, families are being forced to do a certain amount of belt tightening. Six out of 10 say they have had to 'go without' or scale down certain purchases to afford schooling for their children.
Frustrations abound too with regard to the quality of education being paid for. A startling 70 per cent believe it does not provide 'good value for money'.
According to Saurabh Yadav, senior business analyst, GRMC Advisory Services, a private consultancy in Dubai, the negative perception derives from a increments in school costs but minimal improvement in overall standards.
In fact, while parents shell out considerable sums, very few Indian children, for example, go on to secure seats on merit in professional colleges in India, says Rema Menon, director, Counselling Point.
Both the school fee increase and the unsatisfactory quality of education are putting families under pressure, with 50 per cent of expatriates saying that they are sufficiently dissatisfied to consider sending their children to their home country for education.
While some employers provide some form of tuition package, that is limited only to 20 per cent of the respondents, most of them in the upper-income bracket. As a consequence, nearly four out of 10 say that they would consider a personal loan to help out.
Those on lower incomes and Asians are worse off than other income and nationality groups. Sixty-nine and 56 per cent of the res-pondents in the categories of monthly incomes below Dh7,824 and between Dh7,828 and Dh14,676 respectively report that they have had to scale down living expenses to cope with schooling costs. Only 15 per cent of Asians receive a tuition package from their employer, compared to 50 per cent of the western respondents.
Rents
The data, not surprisingly, continues the woeful story on rents. In the most telling statistic here, the burden is reflected in the ratio of rent to salary, which is as high as 45 per cent.
Particularly in Dubai, landlords continue to flout the rent cap of 15 per cent. The stipulation seems to be far from effective.
Of the third who said that landlords haven't complied with the cap law, half did not protest against the rise, and nearly nine out of 10 chose not to register a complaint with the Dubai Municipality Rent Committee.
The majority cite fear of the consequences and their belief that it would make no difference as the principal reasons behind their decision.
For those who did protest, the vast majority (81 per cent) state that it made no difference, or that they were asked to leave the property. Of those who registered a complaint, 53 per cent report that it caused problems for them as a result.
A significant degree of anxiety was evident, with 76 per cent of respondents saying they have heard of tenants being asked to leave the property so that the landlord can increase the rent in excess of 15 per cent.
The social divide is visible here too. Western expatriates more than any other nationality groups report that their landlord did comply with the cap this year 58 per cent as compared to 41 per cent of Asians and 25 per cent of Arabs. Of those who protested against the rise, more Arabs and Asians were told to vacate their property.
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