Skip to main content
Best News Website or Mobile Service
WAN-IFRA Digital Media Awards Worldwide 2022
Best News Website or Mobile Service
Digital Media Awards Worldwide 2022
Hamburger Menu
Advertisement
Advertisement

Commentary

Commentary: Can we stop making flawed assumptions about how those in poverty use financial aid?

Programmes can help the lower-income by relieving the “bandwidth tax”, as AWWA’s experience with unconditional cash assistance shows, says Cindy Ng of Children’s Aid Society.

Commentary: Can we stop making flawed assumptions about how those in poverty use financial aid?
People in poverty experience chronic stress about immediate concerns, and don't have the mental space for discussions about savings and future plans. (Photo: iStock/Krisada tepkulmanont)
New: You can now listen to articles.

This audio is generated by an AI tool.

SINGAPORE: Instead of cash, why not give food vouchers to help a lower-income family, so that they are sure to spend it on essentials? Or how about making financial assistance time-limited, with a review every three months, as a check to ensure taxpayers’ money is well spent?

These were suggestions from social service professionals from a research study I participated in many years ago. I recall wondering about the assumptions and attitudes that even professionals carry when interacting with clients in poverty.

After more than 20 years in the sector, I see these views persist - more recently, in reactions to local social service agency AWWA’s family empowerment programme in which some lower-income families received unconditional cash aid of between S$300 and S$550 a month over 18 months.

The poor will become complacent or unmotivated about resolving their financial problems if aid is given with “no strings attached”, goes the recurrent concern. Another is that aid recipients might spend their “free money” badly instead of on basic needs.

If we want to uplift the lower-income, we need to understand why this view is flawed.

POVERTY IS THE PROBLEM, NOT A PROBLEM OF THE POOR

This perspective leans heavily on the notion that poverty stems from personal shortcomings.

If people believe “the poor wouldn’t be poor if they made better choices”, then they probably also think that those in poverty will struggle to make sound financial decisions due to bad decision-making skills and will likely misuse the assistance extended to them.

Poverty is seen as a problem of the poor, rather than as the problem.

But difficulties in decision-making and problem-solving stem primarily from the chronic stress that people in poverty experience daily, according to a growing body of research.

Mdm Zee* always experiences a sense of relief when her husband’s salary is credited at the beginning of the month. This quickly turns to despair: After paying off the household bills she has only about S$800 left for her family of three.

Living pay cheque to pay cheque keeps Mdm Zee in a constant state of hypervigilance, always uncertain whether the next family crisis or unexpected expense will leave them with even less before the next payday. Her constant focus on immediate concerns makes discussions about savings, setting goals or planning seem pointless. There simply isn't enough mental space to feel confident about making future plans, she says.

Once we stop perceiving it as an innate lack, we can look at improving their decision making and problem-solving abilities.

Then, intervention must target ways to increase cognitive bandwidth and improve mental well-being. AWWA’s study of their family empowerment programme found that mental health improved for participants who received the cash assistance, compared with a control group. 

Crucially, those in the intervention group had better job outcomes, such as landing more secure employment contracts (going from part-time to full-time work for example) or jobs that would provide more stability and longevity. They were not compelled to take just any job.

Unconditional financial aid provided a backstop, a psychological financial floor, which in turn, provided more mental bandwidth.

Still, social service professionals all want to ensure that financial resources - whether from taxpayers or donors - are used to achieve the intended outcome of alleviating economic insecurity. This is entirely appropriate and reflects good governance.

Unfortunately, because of assumptions that people in poverty will misuse resources or lack the knowledge to manage money effectively, programmes often impose strict controls, monitoring and conditions. And this can be counterproductive.

Assumptions that people in poverty will misuse financial assistance often leads to strict controls, monitoring and conditions being imposed, which can be counterproductive. (Photo: TODAY/Ili Nadhira Mansor)

When the conditions of the helping relationship are not dignifying or collaborative, the resulting shame, resentment, and despair can cause people in poverty to drop out of programmes or schemes. Such conditions can intensify feelings of vulnerability and shame, heightening fears of being judged, misunderstood, or blamed for their circumstances.

It's no surprise that people in poverty often withdraw from well-intentioned programmes or refuse assistance from professionals.

Therefore, poverty alleviation programmes must strike a balance, considering both the principles of good governance and how implementation affects the lived experiences of those they are trying to help.

MINOR MISTAKES CAN HAVE MAJOR CONSEQUENCES

It doesn’t help that people in poverty are often judged more harshly for their errors than most of us.

During a recent weekend trip to Malaysia, I made the mistake of packing a 160ml bottle of liquid that exceeded restrictions for carry-on luggage and had to surrender it during the security screening at Kuala Lumpur International Airport. It was a branded beauty product, so it was a relatively costly mistake.

But I had sufficient resources to absorb the impact of my error. Fellow travellers might even laugh and recall similar experiences.

A person in poverty is likely to feel the impact of financial mistakes more strongly and be judged for their actions. Even a minor financial misstep can lead to significant consequences.

Consider the case of Mr Anand*, a low-wage worker earning S$1,500 a month. When his 15-year-old son, Nick*, was caught using a vape in school and reported to the authorities, Mr Anand had to dip into his limited savings to pay the S$200 fine. This incident wiped out the family’s financial cushion, leaving them more vulnerable to falling into debt.

Beyond financial consequences, their mistakes are seen in the light of negative stereotypes about poverty. This reinforces beliefs that they are irresponsible or have poor planning skills, which can further perpetuate the cycle of poverty and discrimination.

Thus, policies and programmes must create some buffer for them to make some mistakes with the assistance and be given the right support to navigate the psychological effects of poverty.

CHECK OUR ASSUMPTIONS

To help individuals and families break out of the poverty cycle, we need to check our own biases and assumptions aren’t getting in the way of helping them effectively.

Policies and programmes should be informed by what research tells us about human behaviour and the complexities of poverty and what the lived experiences of those in poverty. Else, we must take the courageous step to review and revise our approach or risk reinforcing the very prejudices and discrimination that those in poverty already face.

The aim should be to resource people in poverty to enhance their mental bandwidth, not see it as a reward or inadvertently punish them

*Pseudonyms were used in this commentary.

Cindy Ng is Director of Melrose Home at Children’s Aid Society. She is a social worker by training with extensive experience working with low-income families and persons experiencing violence and abuse.

Source: CNA/ch
Advertisement

Also worth reading

Advertisement