(Bloomberg) -- Japan unveiled a raft of new proposals to incentivize people to have children, after Prime Minister Fumio Kishida warned the aging country had only a few years to put the brakes on a demographic slide that threatens the economy.
Alarmed by a plunge in the number of children born in Japan last year to a record low of less than 800,000, Kishida has pledged to introduce measures “on a different dimension” to tackle the problem and to unveil by June a path to doubling the budget spent on children. A new agency for children and families is set to open its doors in April.
Japan last year posted the fewest births since it began keeping records, data released in February showed. This continued a seven-year decline that further aggravates the prospects of a smaller workforce and fewer taxpayers to sustain the world’s third-largest economy in the years to come.
Details are still to come, but the following are some of the ideas released on Friday as part of a three-year plan:
- Child support payments previously subject to an income cap will be provided to all families, and extended by three years until the child graduates from high school. Amounts will be revised to reflect the economic burden of having a large family.
- Handouts for fathers who take paternity leave will be raised to the same level as their post-tax salary. The aim is to raise the percentage of fathers working in the private sector who take at least a week of paternity leave to 50% by 2025 and the proportion who take two weeks to 85% by 2030. That compares with the current level of 14%.
- Housing support will be expanded for families with young children, including giving them priority access to suitable public housing. Extra help will be available for large families who take out loans via the government-backed Japan Housing Finance Agency. This comes after surveys showed cramped homes were cited as a reason why some people have fewer children than they would like.
- Steps will be taken toward providing free school meals.
- Student loan repayment plans will be adjusted for people having a baby and scholarships will be made available to people on higher incomes in some cases.
--With assistance from Yuki Hagiwara.
©2023 Bloomberg L.P.
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