Spain adopts baby bonus scheme
July 5th, 2007
REUTERS
Spain has launched a financial incentive scheme to encourage families to have
more children, becoming the latest in a list of countries employing such a
tactic to boost population numbers.
The family of every child born in Spain will get 2,500 euros to help raise the
country's low birth rate and support the fast-growing economy, Prime Minister
Jose Luis Rodriguez Zapatero said on Tuesday.
The baby bonus follows similar moves in Australia, France, Singapore and
Scandinavia to encourage larger families and counteract a trend towards ageing
populations that places a burden on pension and social security systems.
'To keep progressing, Spain needs more families with more children and families
need more support to have these children,' Mr Zapatero told Spain's Congress in
his state of the nation address.
Spain's birth rate rose to 1.37 per woman of child-bearing age last year, its
highest rate since 1991, but still among the lowest in Europe. The rate would be
far lower if it were not for the arrival of nearly 4 million immigrants since
2000. These immigrants, mainly from Latin America and North Africa, tend to have
larger families.
Other countries are also paying parents a baby bonus, with some claiming to see
positive results.
Australian Treasurer Peter Costello announced last week that the country's baby
bonus scheme had led to the highest number of births since 1971 and the
second-highest since 1911. The country has been experiencing a baby boom of
late, with fertility rates rising to 1.83 children per woman last year, against
1.7 children from 2002 to 2003, said a report in Australia's Herald Sun
newspaper last Thursday. Mr Costello, who hailed Australia's population
milestone of 21 million last week, linked the rise in fertility rates to the
introduction of a baby bonus in 2004, according to the Sydney Morning Herald
last Wednesday.
In France, baby-related schemes offer paid maternity leave for six weeks before
and 10 weeks after childbirth, at a maximum of 80 per cent of earnings, for the
first and second child. For a third child, it is eight weeks before and 18 weeks
after childbirth. French fathers also get time off. Paternity leave extends to
14 days of paid leave and to 21 days in the case of multiple births.
Singapore's baby bonus scheme, which was launched in 2001, currently pays out
€1,500 to parents for the first and second child, and €3,000 for the third
and fourth child. In addition, a Children Development Account, set up for the
second to fourth child, allows the Government to match dollar-for-dollar what
parents save there in the first six years of their child's life. The Government
has capped this amount to €3,000 for the second child, and €6,000 for the
third and fourth child.
In Germany, the 'Elterngeld' or 'parent money' programme allows
an adult who stops work after a child is born to continue to claim two-thirds of
their net wage, up to a maximum €2,000 per month. Low earners can claim 100
percent compensation for lost wages. One parent can claim for up to 12 months;
if both parents take a turn, they can claim the benefit for a total of 14 months
- a tweak designed to encourage more fathers to help. Germany previously paid a
flat €350 a month in benefits to needy parents for up to two years. The change
is expected to raise the annual outlay in direct payments for parents with
infants by about €1 billion per year to €4 billion.
Britain introduced a so-called 'baby bonds' scheme in 2004, giving a €500
voucher to every newborn to start a trust fund, while a new Russian law entitles
families to a bonus of €11,000 following the birth of a second child and any
subsequent children.