CASH assistance is helpful during a crisis but income opportunities are more sustainable in the long run, said economist Dr Muhammed Abdul Khalid.

Muhammed, who was economic adviser to former prime minister Dr Mahathir Mohamad, said cash aid was optimum only for the hardcore poor, the aged and the disabled.

He was speaking last night in Kuala Lumpur at a forum on the findings of a United Nations agencies’ survey of 500 poor households in the PPR housing projects.

The survey in particular analysed the impact of the Covid-19 crisis on women and children in those housing schemes.

“Does cash assistance help?…Yes, it helps during a crisis,” Muhammad said.

He said out of work people were forced to pawn their valuables or even borrow money from loan sharks. Yet when they were asked what they most wanted at such a time, cash was not the answer.

“They wanted aid to start a business, they wanted to look for a job, or they wanted a place to trade. It is (about) income generating so that I don’t have to depend on you,” he said.

“Yes, cash aid does help but it is not sustainable in the long run.”

According to the survey, one in four heads of households were unemployed during the movement control order (MCO) to contain the coronavirus outbreak.

More than 826,000 Malaysians lost their jobs during the pandemic, raising the unemployment rate to 5.3% as of May.

Muhammed stressed on the need for a social protection net such as by making Socso contributions compulsory, including for the self-employed and gig workers such as e-hailing drivers.

“The first policy is to protect everybody. Socso contributions should be made compulsory (instead of merely) encouraged so that when there is a crisis they are protected,” he said.

About 89% of the survey respondents were recipients of the Bantuan Prihatin Nasional cash aid.

Many of them indicated, however, that they wanted a more sustainable form of assistance such as employment, so as not to have to rely on handouts.

There were also requests for a bigger sum of aid and for long-term assistance.

About 52% male and 57% female household heads in the survey did not contribute to EPF and Socso.  – September 10, 2020.