New scheme provides cash aid to help families break out of debt

SINGAPORE — The sole breadwinner for her five schoolgoing children, Mdm Tan already struggles to manage the family’s household expenses and bills with her monthly salary as an ad hoc sales promoter; she can hardly save for rainy days.

But under a new Family Development Programme by the Methodist Welfare Services (MWS), the 34-year-old could receive S$200 in cash from the voluntary welfare organisation every month, which will help offset some of her monthly expenses of between S$1,800 and S$2,000.

Having cleared her debts last year, Mdm Tan, who lives in a rented two-room flat with her children, also hopes to make small strides towards building up her savings through the programme’s savings initiative, where the MWS will give her S$2 for every S$1 she saves.

“It will encourage me to save … It won’t help me much (in the short term), but in the long term, I think it will be very useful to have (the savings),” added Mdm Tan, who declined to give her full name.

Launched at the MWS’ 35th Anniversary Thanksgiving Dinner on Thursday (June 30), its group executive director Jenny Bong noted that the programme would address the chronic debt faced by their beneficiaries.

These are debts incurred from daily living — such as monies owed for housing rental, town council and utilities bills — for more than six months.

For the lowest 20th percentile of households here, she noted that they chalk up an average monthly expenditure of S$760, which outstrips their average monthly income per household member of S$601.

“Many of them are unable to look forward and plan for the future because of the distress that the debt causes. They are also unable to save as they are in deficit every month. When crises such as illness or sudden unemployment occur, they sink further into debt and desolation,” said Mrs Bong.

Commenting on the programme, the Ministry of Social and Family Development said community partnerships are important in ensuring that the specific needs of those who require assistance are met by customised services.

“The MWS’ Family Development Programme is one example of how such partnerships can complement existing efforts by different help agencies,” said a spokesperson.

To qualify for the S$200 cash assistance under the programme, the potential beneficiary has to be a Singaporean citizen, a permanent resident or a foreigner with an immediate family member who is Singaporean.

They will have to be living in a one- to four-room flat, with a gross per capita income of S$650 per month or less and have S$10,000 or less total household savings.

Their cases will also have to be first assessed by social workers.

In addition, the beneficiaries can apply for other forms of assistance under the programme.

For example, those who have incurred debt from housing or other household bills can qualify for debt-matching assistance. MWS will then match S$2 for every S$1 set aside to repay the debt, capped at S$200 a month. Those cleared of their debts can apply for savings assistance, which similarly matches S$2 for every S$1 saved by the beneficiary, also capped at S$200 a month.

They can also receive an additional S$30 to S$40 a month from MWS if they have school-going children enrolled in a Ministry of Education-funded primary, secondary and special schools. Nutritional assistance in the form of milk supplements will be provided if the potential beneficiaries are pregnant or have young children aged three and below.

The programme, which follows a one-year pilot of the debt-matching component, targets to help up to 700 beneficiaries, which will cost MWS at least S$1.7 million each year. It will raise funds to meet the costs. Those who are already receiving other forms of financial assistance, including government assistance, will not be disqualified from this programme.