South Korea is considering paying parents 100 million won (£59,000) in cash for each baby born in a bid to boost the country’s diminishing birth rate.
The South Korean government’s Anti-Corruption & Civil Rights Commission is holding a public survey to gauge the opinion of the people before it can be implemented.
The survey that began on 17 April will ask four questions to understand if they believe it is acceptable to spend 22 trillion won (£12.9bn) annually on the programme and if a financial incentive would motivate couples in the country to have children.
This amount accounts for approximately half of the current national budget allocated to initiatives addressing low birth rates, which totals 48tn won (£28bn) annually.
“Through this survey, we plan to re-evaluate the country’s birth promotion policies to determine whether direct financial subsidies could be an effective solution,” the commission said in a statement.
I expect there will be, but it will come from high time preference people who don’t properly calculate that the cost of raising a child is far, far higher than this.
Spiralling birth rates aren’t really solvable in the short term in modern democratic welfare states. Only extremely dogmatic religious groups have retained high birthrates.
My take on this is actually that 100 million won ($73 grand USD) is really a game changer for people who want to have a family in the Seoul metro area. As it stands, people are getting homes with only about 100 million won for the down payment and then have to get a loan to cover the rest; having a kid immediately doubles that and makes getting a larger home far more plausible, or also having just a far lower monthly mortgage payment on a more modest home…
Family housing in satellite cities will run at about 220-350 million won, and a really nice place is, of course, something like 500 million won or more… Take into account a couple likely can achieve savings of 100 million without any particularly extreme effort, and we are talking about making it so that having two babies automatically puts them in the category where they are paying off a huge chunk of the mortgage. And consider that, already, there are various programs to help with housing…
Obviously, 100 million won disappears before a kid turns 18, but it gives a very important hand up in the real estate market.
I also think that this will be helpful in terms of all the couples who have one kid but consider having two, or two and considering three… That’s where it’ll be a big game changer, IMO.