Means-Tested Government Antipoverty Programs

MEANS-TESTED GOVERNMENT antipoverty programs are governmental attempts to reduce poverty that target only those who are in genuine need. It seems intuitively reasonable that such programs would be more efficient in reducing poverty, because government services and resources would be more tightly focused on appropriate recipients.

However, results have generally been disappointing because of the highly complex nature of welfare programs, and because of the ways in which recipients are selected and monitored. Further, the difficulties attendant upon measuring changes in circumstances (and hence noneligibility to benefit from the programs) have also rarely been successfully negotiated.

Among the best-designed means-tested programs are reputed to be those that have recently been implemented in the United States. These have recorded very low rates of seepage to noneligible households (that is, including those who should not be included) or of exclusion error (that is, not including those who should be included), although participation rates have fallen, which suggests the presence of negative incentives to attempt to joint the schemes.

Effective management has been based upon devising appropriate criteria involving income and assets as well as thorough and rigorous verification of results. Outreach efforts, including partnership with nongovernmental organizations, might help in improving [Page 695]participation rates. While effective, this method is quite resource-intensive and would necessitate perhaps considerable levels of capacity building in lesser developed countries. This is particularly true when the entire network of often-interlocking programs necessary to target all relevant target audiences is considered. The minimum requirements include accurate population statistics with systems to keep them updated, systems for recording residency and eligibility, skilled and motivated government staff at the front line, and sufficient funds and resources to meet advertised benefits. Raising expectations that cannot be subsequently met in part or in full often proves to be more demoralizing than offering nothing at all.

The desire for means-tested programs rather than universal benefits is often motivated by political means. Some people believe that there are a comparatively large number of people who are willing and able to cheat the system and, hence, the onus for demonstrating their eligibility should be upon the potential participant. This argument is related to the unsubstantiated claim that people perceive poverty as negative, and hence receipt of transfer payments offers a superior lifestyle to not being in poverty. So long as people in these tendencies focus their efforts on improving the efficiency of systems rather than questioning their need, then the damage they do will be limited.

Methods of improving means-tested government programs include the use of joint applications across different programs, centralized computer services for record-keeping, and better advertising of services in terms of benefits and eligibility criteria. In general these programs are better aimed when they are intended to promote active change in the recipient's life and circumstances, stimulating behavioral change, and linking the client with further suites of services that are designed to provide a smooth rather than staccato transition process out of poverty.