No plans to replicate, scale up pilot giving cash with no strings attached to low-income families: MSF (2024)

SINGAPORE – There are no plans for the Government to replicate or scale up a pilot which gave 75 low-income households between $300 and $550 a month for 18 months.

This was because there was no clear evidence that the cash transfers led to longer-term positive effects, said Minister for Social and Family Development Masagos Zulkifli on Aug 6.

Social service agency AWWA found that those in the pilot scheme felt the cash transfers helped to improve financial well-being and reduce mental stress, at least in the short term, he said.

While the Government also wanted to know if the study achieved longer-term effects that could be easily and objectively measured, such as time spent in employment, income security or hours worked, AWWA’s findings in these areas were inconclusive, he added.

Mr Masagos noted that another recent study done in the United States found that providing unconditional cash transfers led to decreased work hours, with the saved time spent on leisure, rather than upskilling or searching for better jobs.

Positive effects on well-being and mental health also petered out after the first year, he added, without giving more details on the cited study.

Mr Masagos said: “Our system of social support will continue to evolve as new evidence presents itself. Where such evidence is robust, we will take these into account as we refine our national programmes like ComCare and ComLink+.”

He was responding in Parliament to a question from Mr Melvin Yong (Radin Mas), who asked whether the Government will see if AWWA’s findings – that unconditional cash aid can help lower-income families have better job outcomes and mental health – can be applied to national social assistance programmes.

Mr Yong also asked if the Ministry of Social and Family Development (MSF) would support more of such trials at selected constituencies to examine the effectiveness of unconditional cash aid.

Mr Masagos was also responding to questions filed for Aug 7 by Mr Yip Hon Weng (Yio Chu Kang) as well as Nominated MPs Ong Hua Han and Razwana Begum. They had asked whether the Government will study or expand the project, or consider giving unconditional cash aid alongside other forms of aid that incentivise employment.

The pilot was run as a randomised control trial between May 2022 and November 2023 by AWWA, with funding from Standard Chartered Bank.

Results released in July showed that the cash improved participants’ mental health and job security, as compared with a control group of 95 households.

As agreed with the project organisers, Temasek Trust will fund the project’s second round after results passed internal standards on several outcomes focused on education, skills upgrading and employment.

Mr Masagos added that MSF appreciates the effort and initiative by AWWA to test different approaches to uplift lower-income families, and that their pilot and findings will give MSF a better understanding of how it can continue to improve social interventions.

He also clarified that the project was not a Universal Basic Income pilot, where every individual receives a cash transfer regardless of their circ*mstances.

AWWA provided cash transfers only to clients whose per capita household income was less than $1,000 a month, and whose total household income was not more than $3,600 a month, he added.

Furthermore, the transfers were not given purely on an “unconditional” basis, and AWWA has clarified that the beneficiaries were asked to meet regularly with their case officers, who would continue to actively help them with the challenges they faced, he said.

Rather than adopting the pilot, the Government is instead focusing on strengthening safety nets and providing support in other ways, Mr Masagos said.

It currently provides financial assistance to lower-income individuals and families through ComCare, to help them meet their basic living needs, he added.

He said: “We review the quantum of support provided under ComCare regularly, and will continue to do so. We are also providing additional support to lower-income families with children through ComLink+.”

Under ComLink+, which was announced in November 2023, dedicated coaches work with families to assess their needs, develop action plans, and coach and motivate families as they work towards stability, self-reliance and social mobility, he said.

ComLink+ families who take active steps to secure a better future for themselves and their children will also receive further help in the form of ComLink+ Progress Packages, he said.

These are cash transfers that go beyond what is needed for basic living needs, and will be given when families take steps to improve their circ*mstances and prospects in specific domains, in line with the action plans that they themselves would have developed with their family coaches, Mr Masagos added.

The ComLink+ Progress Packages will be rolled out progressively from thesecond half of 2024, and provide payouts when families fulfil requirements such as pre-school enrolment and employment.

MSF will work with local academics to evaluate the effectiveness of the ComLink+ Progress Packages in a rigorous manner, Mr Masagos added.