Pluses:
It gives hope to the people who are suffering.
It distracts such people from bad thoughts, illnesses, etc.
It gives a feeling that everything is fine.
Minuses:
It still remains a lie. Sooner or later the person will know the truth. In this case those who told the lies will not be relied on any more.
Also time will be lost. It may be too late to change the situation for the better.