Does a single poverty line help you to identify who are the poor who really need help?

does a single poverty line help you to identify who are the poor who really need help

The Workers’ Party Jamus Lim renewed his party call for an official poverty line. He called for the establishment of a committee of government representatives, civil society leaders and academic experts to decide what the poverty line should be, and for all government assistance and policies to then be pegged to this threshold.

Back in 2013, in response to calls for a poverty line to be drawn, Minister Chan Chun Sing said, “If we use a single poverty line to assess the family, we also risk a ‘cliff effect’, where those below the poverty line receive all forms of assistance, while other genuinely needy citizens outside the poverty line are excluded.”

What is this ‘cliff effect’? 

The Cliff Effect occurs when a pay raise at work raises a worker's salary above the poverty line and triggers a disproportionate loss of government assistance. Even a small raise can “push people off the cliff” when it comes to benefits.

The fall from a cliff is sharp and sudden. 

Hard work should be rewarded and everyone should have the opportunity to work hard, earn a bigger salary and achieve family economic security

Suppose a worker earning a salary at the poverty line gets a pay raise of $100. This puts him above the poverty line and immediately disqualifies him and his family from all forms of assistance

A pay raise, instead of improving the family’s financial situation, leaves the family worse off and in greater hardship. It’s like taking one step forward only to be pulled back two steps. 

Breadwinners may make the terrible choice of choosing to forgo the pay raise or look for a better-paying job for fear of losing the benefits the family needs. 

Is a single poverty line helpful in identifying who needs help?

The problems faced by the poor are complex. These include ill health, lack of housing and weak family relationships. Any solution to help the poor must go far beyond numbers because numbers cannot decipher complex problems. Moreover, someone earning a good salary may need support because of special needs in the family.

Does a single poverty line help you to identify who are the poor who really need help? And does it help you to focus your resources?

Instead of a single poverty line or even a single layer of assistance, the Singapore Government favours giving multiple lines of assistance to help Singaporeans across the spectrum, in help schemes that are layered and overlapping with one another.

Mr Chan Chun Sing described this as the Kueh Lapis approach back when he was Minister for Social and Family Development in 2013. 

SG Matters PowerPoint

When the solution is more than just giving out cash...

During a dialogue on the final day of the International Conference on Cohesive Societies held at the Raffles City Convention Centre last year (September 2022), Finance Minister Lawrence Wong said that helping struggling low-income families involves more than just giving financial aid as their problems are complex and multi-faceted. 

It may be counterproductive to simply hand out cash to such households, as some of the problems might be marital in nature, or related to past criminal conduct or addictions.

Singapore adopts a “family-centric approach” that brings different government agencies together to help the family in need.

This is highly resource-intensive and requires a lot of coordination among people such as counsellors, social workers and volunteers just to help one family, Mr Wong said, but the outcomes are positive. 

Who are the poor?

Every society has poor people. So too has Singapore poor people

There are 2 groups of people who need help: the temporary poor and the chronic poor. 

The temporary poor are those who fall into temporary hard times through various reasons. These can be helped out of poverty through some temporary assistance such as ComCare.

The chronic poor are those who are poor for a very long time and have a problem getting out. They belong to the group that DPM Lawrence Wong referred to. Their poverty could be due to ill health or addictions. 

Stabilising these families is not just a matter of transferring money to them. It may also involve getting them a job and making sure their children go to school. These people require many years of assistance to get them out of the dark valleys. Help comes also in the form of volunteers who hand-hold them and mentor them out of their situation. 

As our society matures and as our country grows richer, helping the poor cannot be just the responsibility of the Government. The community can also play their part, as many do through ground-up initiatives. 

In remarks made in 2013, Minister Chan Chun Sing said that having a poverty line or focusing on numbers may be more politically palatable, but it would be simplistic and disingenuous.

"I don't want to be politically expedient. I understand it is easy to have a (politically) correct headline, but that is not what I am here for, and I hope I never get into that position. We continue to do useful things, continue to do purposeful things for the people, whom we care for, not just because it's expedient to do so."

We should not blindly follow others.


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