Pyramid scheme slows -- top investors fret
Where birth rates have improved, governments and their owners are worried
about economic consequences. The solution, they figure, is to encourage
breeding among the masses. Studies show that economic
incentives don't work over the long term, but those are easily overlooked.
A partial list of countries' baby bounties:
Birth rate up after baby bonus
September 16, 2006
The birthrate is accelerating since the maternity payment became available, new figures show.
Centrelink data obtained by The Australian shows 268,667 parents claimed the payment from the federal government for their newborns in 2005-06.
While yet to be confirmed in official birth statistics, this number represents an increase of more than 10,000 births or 14 per cent on the previous year, and more than 16,000 on 2003-04.
Demographers suggest the maternity payment - worth $3000 when introduced in July 2004 but increased to $4000 this July - combined with low interest rates and low unemployment, may be driving the baby boom.
Australia's fertility rate, which reached 1.8 babies per woman last year, is up from 1.72 in 2003 and is well above rates of 1.2 to 1.4 babies in many other developed nations.
The Centrelink data shows 235,299 claims for the bonus - comprising 194,342 couples and 40,957 single parents - in 2004-05.
The number of claims jumped by 33,368 in 2005-06 to 268,667, perhaps reflecting the fact some parents failed to claim the bonus in its first year.
The figures dispel suggestions the lucrative payment has encouraged teenagers to have children, with only 186 extra claims by teenagers between 2004-05 and 2005-06.
Overall, 4,800 teenagers claimed the bonus in 2005-06.
However, older women are increasingly giving birth.
The number of claims by parents over the age of 40 increased from 9906 to 15,873.
Similarly, the number of claims by parents aged 35-39 increased from 44,783 in 2004-05 to 55,350 in 2005-06.
© 2006 AAP
ESTONIA and others
In Estonia, paying women to have babies pays off
Friday, October 20, 2006
By Marcus Walker, The Wall Street Journal
TALLINN, Estonia -- Pia Kurro sat cross-legged on her bed in a drab, Soviet-era maternity ward that smelled of detergent and old linoleum and breast-fed her two-day-old daughter, Syria, who owes her existence to state subsidies.
In return for having the child, Ms. Kurro will receive the equivalent of $1,560 a month from her government for over a year, a lot of money in a country where the average monthly salary is $650.
"I would not have had a baby without the support," said the 39-year-old business consultant.
Ms. Kurro embodies an increasingly urgent question: Can government policies aimed at raising a nation's birthrate actually work? The answer is vital to the future of the global economy. Like most developed countries around the world, Estonia has a critical shortfall of children that, if not reversed, will lead to a sharply aging and shrinking population. That will undermine economic growth and public finances as a dwindling work force struggles to support a growing pool of retirees who are living longer.
A handful of developed countries, including the Nordic nations and France, have stable populations thanks to a long tradition of financial support for families. But for other countries in Europe and Asia that have already seen steep falls in birthrates, demographers have doubted there was much that could be done. Governments agreed, making little serious attempt to boost their birthrates. Estonia stands out because it has made a dramatic shift, from laissez-faire to aggressive activism, in an attempt to alter its future. And as other nations slowly start to address the risk of declining birthrates, the effort there is being closely watched around the world.
Estonia's wake-up call came in 2001, when the United Nations' annual world-population report showed that Estonia was one of the fastest-shrinking nations on earth, at risk of losing nearly half its 1.4 million people by mid-century. Estonia's fertility rate -- the average number of children a woman bears -- had collapsed to 1.3 in the late 1990s, down from 2.2 under communism only a decade earlier.
In an attempt to stop that downward spiral, Estonia took a bold step: In 2004 it began paying women to have babies. Working women who take time off after giving birth get their entire monthly income for up to 15 months, up to a ceiling of $1,560. Non-wage-earners get $200 a month. The welfare perk -- known locally as the "mother's salary" -- was a sharp about-face for the radically free-market government.
"Step by step, (the declining birthrate) became a danger to the survival of the nation, so we had to do something," says Paul-Eerik Rummo, minister for population affairs and a member of the Reform Party in Estonia's ruling coalition.
Now, two years into the program, the government is seeing some of the first tentative results. Since the adoption of the new benefits, Estonia's fertility rate has improved to 1.5. That's still below the 2.1 children needed to stop the population from shrinking (one child to replace each parent, plus some room to allow for child mortality). And it will take years to see the full impact of the mother's salary. But the apparent early success has inspired the government to look at other ways of getting people to have more children -- everything from subsidies for nannies to linking pension payments to the number of children one has.
Many countries once loath to meddle in matters of fertility are looking at their numbers and concluding that they must take similar steps. "Governments may not achieve their aim, but the competing risk of doing nothing is too great for many countries -- their future young labor supplies are going to be decimated," says Peter McDonald, professor of demography at the Australian National University in Canberra.
The fertility rate in the 30 countries of the Organization for Economic Cooperation and Development, the club of the world's leading industrialized democracies, was only 1.6 in 2005, down from 2.4 in 1970. Mexico, at 2.4, is the highest, with South Korea the lowest at 1.1. Demographers say the decline is due to fundamental changes in society. They include: greater economic opportunities for women; advances in birth control that have made reproduction a matter of choice rather than accident; and the spread of ideas about individual freedom and happiness that are hard to reconcile with caring for a large family.
Some European countries are experimenting with monthly cash compensation to women who leave work to have babies, including Lithuania, Austria and Slovenia. Starting next year, Germany and Bulgaria plan to pay new mothers benefits linked to their previous earnings. Russian President Vladimir Putin, who bemoaned his country's lack of children in his last state-of-the-nation speech in May, has also promised more aid to parents.
Elsewhere, Australia introduced in 2004 a one-time bonus per baby, currently worth about $3,000. The fertility rate is believed to have risen slightly thanks to a combination of the incentive and a booming economy, but is still around 1.8. Australia's finance minister has even exhorted parents to "do your patriotic duty tonight," echoing similar campaigns in the city-state of Singapore, which is still struggling with a fertility rate that hovers barely above 1.2. South Korea has introduced several policies this year, including more financial aid for day care and for fertility treatment.
Payments such as Estonia's are predictably controversial. Some demographers argue that paying people to have a baby simply makes them have one earlier; it doesn't necessarily make them have more. That point is tough to prove for now: Only after the current generation of young women passes menopause will it be clear whether they had more children in their fertile years than women of an earlier age group.
But the experience in places such as France and the Nordic countries suggests that incentives can have an impact. For example, women in Sweden and Norway, which support families with generous benefits, labor laws and child care, have close to two children on average. "Where there are consistent family-oriented policies in place for a long time, people have more children," says Tomas Sobotka of the Vienna Institute of Demography.
The main exception to the rule is the U.S., where the average woman has two children, despite only modest public support for families, largely via tax breaks. Demographers say America's tradition of mass immigration and its large minority populations make it unusual among developed nations. Hispanics, in particular, boost national fertility, with more than three children per woman. The U.S.'s population passed 300 million this week, according to the Census Bureau's estimate. About 55 percent of America's population growth is due to legal and illegal immigrants and their children, according to the Population Reference Bureau in Washington.
As Europe Grows Grayer, France Devises a Baby Boom
By Molly Moore
Washington Post Foreign Service
Wednesday, October 18, 2006; Page A01
JUMEAUVILLE, France -- When the municipal day-care center ran out of space because of a local baby boom, the town government gave Maylis Staub and her husband $200 a month to defray the cost of a "maternal assistant" to care for their two children.
When Staub delivered twins last December -- her third and fourth children -- the nation not only increased their tax deductions and child allowances, the government-owned French train system offered 40 percent discounts off tickets for the parents and the children until they reach their 18th birthdays.
After urging women to have children and bolstering family subsidies, France has Europe's second-highest fertility rate. Maylis Staub took a year off work when her twins were born.
"The government favors families a lot," said Staub, 35, a project manager for a French cellphone company. "They understand that families are the future. It's great for us."
While falling birthrates threaten to undermine economies and social stability across much of an aging Europe, French fertility rates are increasing. France now has the second-highest fertility rate in Europe -- 1.94 children born per woman, exceeded slightly by Ireland's rate of 1.99. The U.S. fertility rate is 2.01 children.
In many European countries, park benches are filled with elderly residents. In France, parks overflow with boisterous children, making it an international model for countries struggling with the threat of zero population growth. In recent months, officials from Japan, Thailand and neighboring Germany have traveled to France to study its reproductive secrets.
But the propensity of women here to have more babies has little to do with notions of French romance or the population's formerly strong religious ties to the Roman Catholic Church.
France heavily subsidizes children and families from pregnancy to young adulthood with liberal maternity leaves and part-time work laws for women. The government also covers some child-care costs of toddlers up to 3 years old and offers free child-care centers from age 3 to kindergarten, in addition to tax breaks and discounts on transportation, cultural events and shopping.
This summer, the government -- concerned that French women still were not producing enough children to guarantee a full replacement generation -- very publicly urged French women to have even more babies. A new law provides greater maternity leave benefits, tax credits and other incentives for families who have a third child. During a year-long leave after the birth of the third child, mothers will receive $960 a month from the government, twice the allowance for the second child.
A century ago, France was one of the first European countries to face a declining population. Since then, almost every elected French government -- regardless of party -- has instituted laws that encourage bigger families and make it easier for women to keep their jobs while raising children.
"Politicians realized they had to encourage people to have more babies if they didn't want to live in a country of old people," said France Prioux, director of research for France's National Institute of Demographic Studies.
Most of the subsidies and allowances are income-based, giving low-income families the most help. But higher-income families also receive substantial benefits so that only a fraction of a working mother's salary goes to child-care costs.
Under French law, a woman can opt not to work or to work part time until her child is 3 years old -- and her full-time job will be guaranteed when she returns. "In other countries, maternity leaves are seen as a handicap for mothers who want to have a career," Staub said. "It's different in France."
France pays to boost birth rate (sorry, no link)
Friday, September 23, 2005
PARIS, France (Reuters) -- France will give more money to families with three children in an effort to encourage the French to have more babies, Prime Minister Dominique de Villepin said on Thursday.
A parent who puts his job on hold to raise a third child will receive 750 euros ($915.6) per month for one year, around 50 percent more than the monthly amount families with two children receive for a three-year period, Villepin said.
Shortening the time period but increasing the sum aims to help mothers get back into their job quicker after giving birth, and prevent them from suffering career disadvantages, government sources have said.
"The birth rate is still insufficient in our country," Villepin said at a national conference on families.
"If the number of families with three children doubled, the replacement of generations would be assured," he said, adding the new measure would cost 140 million euros per year.
France, which already has a generous child care system in place, has a birth rate of 1.9 children per woman -- well above the EU average of around 1.5. In countries such as Italy, Spain, Germany and Poland, the rate is as low as 1.3, data shows.
Villepin also said France would create 15,000 new creche places, double tax credits for some child care costs and improve financial conditions for parents looking after a sick child.
"The measures will allow us to advance in two directions," Villepin said. "To give the French the possibility to have as many children as they want, and to support parents in better protecting their children against society's new threats."
With unemployment at close to 10 percent and high oil prices weighing on consumers, France's conservative government has come under pressure to do more for cash-strapped households.
But France is also under pressure from Brussels to cut its public deficit to below the European Union's limit of three percent of gross domestic product.
Paris has broken the limit every year since 2002, and has told the European Commission its deficit would come in at 3 pct of GDP this year.
Copyright 2005 Reuters. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.
Germans get incentives for having babies
By STEPHEN GRAHAM, Associated Press Writer Jan 3, 2007
BERLIN - When her water broke early on New Year's Eve, Julia Gotschlich was mainly thinking about the imminent birth of her second child. But she couldn't help worrying about family finances, too.
She and her husband stood to lose out on more than $13,200 if the baby arrived before midnight, when Germany's generous new family benefits took effect — part of a government effort to raise one of the lowest birthrates in Europe.
Births in Germany dropped 4 percent in 2005 from the previous year, according to figures from the Federal Statistics Agency, to around 690,000. That's the lowest since World War II and lagging even 1946, when 922,000 babies were born even as the country lay in ruins.
A recent government study forecast that Germany's population will drop by as much as 16 percent by 2050, from the current 82.4 million to as little as 69 million. That could hurt the economy by sapping the work force — and undermine the state pension system.
Facing such an alarming demographic trend, the German government has shaken up its financial assistance to parents in a bid to make it easier for working women to have children.
The new "Elterngeld" — or "parent money" — program 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 $2,375 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 $400 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 $1.2 billion per year to $5 billion.
Other countries have instituted similar incentive programs to boost birthrates. France and Sweden both pay child subsidies roughly equivalent to those in Germany — but also have an extensive network of low-cost childcare centers that take babies to preschool-aged children.
France offers additional help to some families who need in-home care. The Swedes give either moms or dads 80 percent of their salary for a total of 480 days in a parental leave.
While the French had 12.7 new babies per 1,000 residents in 2004 and the Swedes 11.2, Germany recorded only 8.5 new births — the lowest rate in Europe not counting Vatican City.
Britain introduced a so-called "baby bonds" scheme in 2004, giving a $490 voucher to every newborn to start a trust fund, while a new Russian law entitles families to a bonus of $9,600 following the birth of a second child and any subsequent children.
Gotschlich's baby, Inka Angelina, held off just long enough to qualify for the new German law, emerging 63 minutes into 2007. That means mom will be able to finance a full year off from work as opposed to just eight weeks with her first child.
"At first, I thought: 'Can't you wait a little longer?'" Gotschlich said at Berlin's Auguste-Viktoria Hospital.
As midnight approached, "the doctors and midwives were encouraging me that maybe we would make it into the new year after all, and we did," she said, smiling at her daughter asleep in a bassinet at her side.
There had been media reports about German women taking magnesium tablets, which can prevent premature labor, or putting off planned Caesarean births to qualify for the new bonuses.
Klaus Grunert, a doctor at Auguste-Viktoria Hospital, said some women avoided things thought to help induce labor — from hot baths and massages to sex. But he said none asked doctors to delay births, which the doctors would have refused in any case.
Gotschlich and her husband, a software engineer, decided to have a second child two years ago — long before Chancellor Angela Merkel's left-right coalition took power vowing to do more for families. Although Gotschlich said the family will still earn less than when both she and her husband worked, the new incentive plan will make life easier.
"We'll have to see what kind of vacation we have this year," she said. "We can still afford one, though the car and the washing machine had better not break down."
Cash boost for tribal families
By Subir Bhaumik
BBC News, Shillong
Amelia and her husband make a living selling vegetables and fish.
Amelia Sohtun has 17 children and she has recently received a cash reward of several hundred dollars for mothering them.
So have Dorothia Kharbani and Philomena Sohlangpiaw for producing 15 children each.
All three are members of the Khasi tribe in India's north-eastern state of Meghalaya.
National policy in India seeks to limit population growth.
But, the Khasi Hills Autonomous District Council (KHADC) in Meghalaya has started rewarding Khasi mothers with more than 15 children as part of its declared mission "to save Khasis from being outnumbered by outsiders".
"We have enough land but if our Khasi people don't grow in numbers, migrants from Bangladesh or elsewhere in India will occupy that living space," explained KHADC chairman HS Shylla.
Some mothers say they are grateful for the payments, but women's rights activists have been less happy.
The KHADC is an elected autonomous body of the Khasi tribe and the state government generally avoids interfering with the KHADC in matters of local customs and traditions.
"We are encouraging our people to grow more. Now the Khasi population is around one million in Meghalaya, but we want it to double in the next 10 years," Mr Shylla told the BBC.
Russian lawmakers pass maternity bill in first reading
Nov 17, 2006
MOSCOW, November 17 (RIA Novosti) - A maternity incentive bill on payouts for women who give birth to more than one child was passed by lawmakers in Russia's State Duma in its first reading Friday.
The president-sponsored bill, aimed at reversing the current decline in the nation's birth rate, will provide for one-off payouts to women who give birth to or adopt a second child after January 1, 2007, and for subsequent births.
But the payouts, which are currently set at 250,000 rubles (a little under $9,400), but will be revised annually to adjust for inflation, come with conditions attached. They could be invested in education, housing, or a pension saving program, but not until the child turns three, or three years after his/her adoption.
The second-birth incentive bill is expected to help Russia overcome a severe demographic crisis. The country's population has been in steady decline since the launch of market reforms in the early 1990s, and, according to the United Nations, it may further fall by one-third by the middle of the century, from today's 142 million.
Ahead of the bill's submission to parliament last month, Deputy Duma Chairman Oleg Morozov said, citing expert estimates, that if enacted, the new legislation could triple the birth rate within three years.
In his annual address to the nation in May, President Vladimir Putin said the population was falling by about 700,000 each year, and pledged financial incentives to women with larger families.
Jan 4, 2007
Pregnant women's 'bill of rights'
TANYA THOMPSON SOCIAL AFFAIRS CORRESPONDENT
* Guide on maternity rights at work to be given to all pregnant women
* 1504 British women lodged cases at tribunals in 2005-6, up 46% in 3
* Plans to extend maternity pay to a full year
IN THE KNOW
* Pregnant women are entitled to paid time off for antenatal appointments and maternity leave.
* Fathers may be able to take up to two weeks' paid paternity leave once the baby is born.
* Employers must conduct a risk assessment and make arrangements to protect the woman and her unborn child at work.
* Pregnant women are entitled to up to 52 weeks' maternity leave. (Ministers have said they plan to extend maternity-pay entitlement from six to nine months from April 2007, and to a year by the end of this parliament.)
* The woman has the right to request flexible working hours, parental leave and time off to deal with a family emergency.
“Over the long term, however, policies that promote childbearing have had little effect (96, 314, 472).”
Eliminating Targets, Incentives, and Disincentives [for using contraception and/or breeding] a USAID paper.
Bibliography of above paper.
96. DAVANZO, J. and GRAMMICH, C. Barren ground: Eastern Europe’s transition from communism isn’t the only factor affecting the region’s demographics. RAND, Population Matters, Jan. 3, 2001.
314. PANEL ON POPULATION PROJECTIONS, COMMITTEE ON POPULATION, and NATIONAL RESEARCH COUNCIL. Posttransition fertility. In: Bongaarts, J. and Bulatao, R.A. Beyond six billion: Forecasting the world’s population. Washington, D.C., National Academy Press, 2000. 258 p.
472. ZAKHAROV, S.V. and IVANOVA, E.I. Fertility decline and recent changes in Russia: On the threshold of the second demographic transition. In: Davanzo, J. and Farnsworth, G. Russia’s Demographic Crisis. Santa Monica, California, RAND, 1996. 33 p.