Is Singapore’s Baby Bonus Working Or Is It Time To Re-imagine The Future Of Fertility?

Ally Villar
·4-min read

Last year, Singapore’s total fertility rate fell to its lowest in decades. To support couples with plans of conceiving, the country began to implement pro-fertility policies and cash incentives such as the Baby Bonus scheme. But is the Baby Bonus in Singapore really working to boost the country’s fertility rate?

A recent study by ValueChampion suggests that the Baby Bonus in Singapore hasn’t been helping local parents.

Results of their data show that “the Baby Bonus hasn’t incentivised people to have children, despite cash amounts and eligibility criteria increasing per enhancement.”

Are Baby Bonuses Working Or Is Time To Re-Imagine The Future Of Fertility?

Image source: iStock

The Baby Bonus scheme was introduced in Singapore in 2001, to help locals manage the upfront costs of parenting. This involves pregnancy, delivery, and the overall experience of raising a child. This scheme offers a three-tier package that includes a cash gift, Child Development Account, and government dollar-for-dollar matching.

These were all an effort to increase the country’s total fertility rate. But recent studies have found that the financial incentive has yet to work.

ValueChampion looked into the effects of Baby Bonus in Singapore against the shifting priorities of Singaporeans. This was done to find out whether or not Baby Bonus had achieved its goals.

“We also compared its results to other pro-natalist countries that implemented similar financial incentives for childbirth to highlight any inefficiencies of Singapore’s plan to raise their fertility rate, and illustrate what it would take to encourage women to have more children,” researchers wrote in their study.

In 2020, the country’s total fertility rate fell to 1.1 children per childbearing woman. This is not only a 31.25% decrease from 2000, but is also the lowest fertility rate in Singapore’s history.

Findings revealed that the Baby Bonus scheme in Singapore did create short-term boosts in birth rates. But it also only seemed to have had a temporary effect on shifting the timing of birth-giving. This did not help generate a desire to start having babies.

“However, other births saw annual fluctuations or overall decreases, and overall birth rate actually fell over the long run. Not only that, even the short-term boosts should still be taken with a grain of salt, as Baby Bonus Enhancements and 1st live births have a weak correlation of just 0.26,” researchers say.

Why Baby Bonus In Singapore Doesn’t Work Effectively

baby bonus in singapore
baby bonus in singapore

Image source: iStock

The study found various reasons why Baby Bonus may not be working effectively in Singapore.

1. Cash incentives for women who give birth have not worked anywhere else around the world.

Providing a cash bonus to women who give birth is not an effective measure to increase fertility rates. It hasn’t worked for other countries and it similarly won’t work for Singapore.

“Countries with ageing populations like Singapore would need to reach a replacement-level of fertility of 2.1 babies per woman to sustain their population. But, none of these countries have been able to meet this goal,” the study says.

2. Women have difficulty choosing between their careers and having babies.

The declining fertility rate can also be due to women focusing on their careers first before deciding to have children. The study finds that there is a strong negative relationship between “the rise of female labour force participation and the decline of the country’s total fertility rate.”

About 39 percent of mothers in couple-based households with children are found to be out of Singapore’s labour force. This is why more women now are choosing to pursue an education and career instead of starting a family.

3. The Baby Bonus in Singapore would need to at least have an increase of about 219 percent.

At the very least, this is needed to cover all the costs of pregnancy, childbirth and raising children. With this, it could reach about S$98,884.

What are your thoughts on the Baby Bonus scheme? Have you availed it and has it helped you. Share your experiences with us here.

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