Spooked by demographic trends, politicians are taking a closer interest in how many babies their country’s citizens are choosing to have. In fact, the UN suggests that 28% of countries worldwide have policies intended to incentivise people to have children, including baby bonuses, tax cuts, childcare provision and more generous parental leave. These ideas aren’t new, but in 2022 we started to hear of senior politicians in the UK entertaining the merits of these so-called ‘pronatal’ policies, with reports hitting the press of a cabinet minister backing tax cuts for women who have more babies. But should the UK be quite so quick to follow other countries down this path?
The surge in political interest in fertility rates has been sparked by the projected economic consequences of the current demographic trajectory. While the total world population recently reached eight billion and is still growing, that growth is being driven by people living longer rather than being born in larger numbers.
According to the UN, about two-thirds of the world’s population live in countries where too few babies are being born for the population to replace itself. In England and Wales, the ONS reports that the fertility rate has declined since 1964 and has been below replacement levels since 1973. Fewer babies being born means fewer people joining the population, leading to a risk of economic and social stagnation. Combined with people living longer, fewer births also means an increasing imbalance between the size of the retired population and the working population available to support them.
At first glance, pronatal policies might appear to be a win-win for the state and for families. In Lestijärvi in Finland, families have received €10,000 per birth since 2013. France has a longstanding range of pronatal policies: public spending on families is generous, families receive grants, benefits and subsidised childcare to help with the costs of having children and France has had a consistently high fertility rate.
However, taking a closer look at the recent wave of pronatalism, there are good reasons to be sceptical of policy interventions designed primarily to incentivise more births. Some studies have pointed to a ‘modest’ impact on birth rates but overall the evidence base on the impact is generally mixed. For example, these policies may create a short-term boost in birth rates, but this may reflect an influence on birth timing without changing the total number of children born in the long term. Hungary charges families with three or more children virtually no taxes, but so far it does not look as if this policy has led to many third or fourth babies. The political climate in Hungary underscores other reasons to be sceptical about the pronatal push: these policies are often linked to anti-immigration and nationalist sentiments, or to restrictive policies around access to contraception and abortion. A focus on birth rates alone implies a narrowly defined role and status for women, and raises questions about whether the state has any place ascribing a social or economic value to procreation.
Further, the costs of having a child are not limited to the time of birth, meaning longer-term pro-family policies that promote parent and child wellbeing and support parental labour market participation may make more sense from a wider social and economic point of view.
For example, these policies could include improved provision of childcare, more flexible working for parents, high-quality education and health services, a child-friendly built environment and a culture that is welcoming to children and supportive of parents. Swedish families receive a range of social benefits combined with long periods of protected parental leave and excellent childcare provision. As a package, these pro-family policies seem to have accompanied a climbing fertility rate between 2000 and 2010, and while it has since fallen, it remains higher than many of its European neighbours.
The UK, and England in particular, does not perform well on measures of family friendliness at present. UNICEF ranked the UK 28th out of 31 countries across paid parental leave, support for breastfeeding and affordable, high-quality childcare and preschool education. We have the second-highest childcare costs in Europe. A couple with an average income and two children under three spend 29% of their annual income on childcare, compared to just 12% in France. A staggering 62% of parents surveyed by the UK charity Pregnant then Screwed said that high childcare costs prevent them from having more children.
Meanwhile, UK child poverty rates are unacceptably high: an average of eight children in a classroom of 30 were living in poverty in 2020-21. Larger families are particularly exposed to deep poverty and the current benefit cap for families with more than two children is a driver of this poverty.
The backlash that followed the call for tax cuts for women having more children in this country illustrates the pitfalls of sticking-plaster solutions to long-term demographic shifts. One-off cash incentives, tax cuts or appeals to patriotism are unlikely to change the equation for would-be parents making significant life decisions. Yet the rise of pronatalism should be taken seriously as a signal that something has gone awry when it comes to state support for family life.
Rather than a narrow focus on the number of births, support should address families’ needs in the round. The UK urgently needs to improve availability and affordability of childcare and uptake of early education. To improve the conditions in which children grow and develop, we need to reduce the pressures families face, including their financial conditions. It is possible to make a long-lasting difference to the quality of family life in ways that will promote the health of our population in the long term, but we should look beyond the baby bump.