December 8, 2023

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Canada can look to European countries in addressing birth rate crisis, says think tank

New reports from a Canadian think-tank show that the country needs to do more to address its declining birth rate and that policies in European countries offer a path forward.

“Our first step needs to be to stop pushing the myth that women always want to have fewer kids or to prevent pregnancy,” Andrea Mrozek, a Senior Fellow with the think-tank Cardus, told True North. “We should find ways to address the things that stop women from having the children they want.”

When asked what policies Canada could implement to incentivize women to have more children, Mrozek suggests a cultural shift. 

“Young Canadians need to hear messages of empowerment and competence in parenting rather than more warnings about the expense or difficulty of parenting.”

Looking at Canada’s plan to implement its $10 per day child care program, Mrozek says there isn’t much evidence that subsidized child care would increase fertility.

“Quebec’s fertility rate has declined despite the highly subsidized child care program,” said Mrozek. “The national child care program is unlikely to affect fertility because so many families will not be able to access it.”

“National daycare will cover only the federal government’s preferred form of care,” said Mrozek. “Not the many forms of care families actually use.”

A report by Cardus Program Director Peter Jon Mitchell shows that an increasing proportion of young adults aged between 20 and 34 are living unpartnered and those who do marry, marry later.

In 1971, the average age at first marriage was 24 years old for men and 22 for women. In 2008, the numbers jumped to age 31 for men and nearly 30 for women. In 1996, 35% of Canadians between the ages of 20 and 34 were married whereas today it has dropped to just 20%.

Canada’s fertility rate sits at 1.40, the lowest in any western country.

“Increased fertility is key to maintaining the country’s ability to finance its social safety net and to help fulfill unpaid caring obligations for aging generations,” writes Mitchell. “Immigration has masked Canada’s declining fertility rate, but that may not last.”

“While fertility decline is complex, there is little hope of reversing the trend if marriage and partnership rates decline among Canadian young adults,” writes Mitchell. “Leaders at all levels – government, academia, and civil society – need to come to grips with the barriers that prevent the formation of the stable families many people desire.”

Mitchell suggests that the implications of low fertility and the imbalance caused by an aging population “will strain the future ability to finance social programs.”

“Low fertility and an aging population will also affect aspects of civil society,” writes Mitchell. “Fertility rates have an impact on labour supply, health care and public pensions.”

Countries such as Hungary, Poland, France and Finland have seen dramatic expansions in pro-birth policies. Mitchell points to those governments in Europe trying to mitigate the impact of low fertility with incentives such as cash benefits, allowances, loans and extended parental leaves as possible solutions. 

According to Lyman Stone, a senior fellow at Cardus and demographer for the Institute for Family Studies, Poland’s 500+ program increased the birth rate dramatically before eventually levelling out. The program provides a monthly benefit of $150 CAD for each second and subsequent child up until the child turns 18.

“Poland’s pro-natal policy is a generous and now nearly-universal cash benefit,” writes Stone. “So, unsurprisingly, it’s working.”

Another analysis report by Cardus shows financial support in Finland allows those eligible to receive nearly $500 per month per child under three after parental leave. “Finland offers a choice of subsidized child care through either daycare or the home care allowance which can be used for home care, granny care, neighbour care or other private forms of care,” writes Cardus.

France offers benefits that increase based on having more children. “Parents automatically receive a family allowance after the birth of the second dependent child and until the child reaches age 20, the parents are entitled to additional support,” the report writes.

According to the report, Hungary spends 4.7% of its GDP on family benefits which “include tax breaks, service, and money for families with children. Daycare and kindergarten are free.” Hungarian parents can expect 70% of one parent’s salary who stays at home with a child in the first year.

Cardus offers several recommendations that the government of Canada could adopt including lowering taxes for families with children and maintaining neutrality towards private forms of child care.

“Build on the successful Canada Child Benefit,” writes Cardus, “monthly amounts should be increased, including for middle-income families for whom child care-related expenses are a significant burden.”