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  • Surprise jump in fertility rates
  • Attributed to Peter Costello’s baby bonus
  • 12,000 extra babies born in 2004-06

FORMER treasurer Peter Costello’s baby bonus could have delivered almost 12,000 extra births, accounting for the surprise jump in Australian fertility rates between 2004 to 2006.

A Melbourne Institute study has found that the controversial bonus succeeded in convincing at least some parents to follow Mr Costello’s exhortation in 2004 to have “one for mum, one for dad, and one for your country”.

Study co-author Mark Wooden said analysis of intentions to have a child and of reported births suggested the baby bonus had increased the fertility rate by 3.2 per cent, The Australian reports.

The figure matches the increase in Australian fertility rates from 1.763 in 2004, when 254,246 children were born, to 1.817 in 2006, when 265,949 were born.

“If the baby bonus hadn’t worked, and our estimates are correct, probably those 12,000 (additional) kids born in 2006 wouldn’t have been born,” Professor Wooden said.

Most of the women who had children in 2006, however, were swayed by factors other than the baby bonus to have children, making the job of convincing the remainder an expensive proposition for government, the study by US and Australian researchers found.

“The small size of the effect yields a marginal cost per additional child figure of at least $124,000,” it concluded.

The bold new estimates lend support to Howard government claims that the initiative drove up birthrates. It also challenges Families Minister Jenny Macklin’s assertion last year that the recent rise in births was unrelated to the bonus.

It also comes as the Rudd Government considers a Productivity Commission draft recommendation to roll the baby bonus, now worth $5000 per child, into a wider paid maternity leave scheme.

Professor Wooden said a higher birth rate had an economic value that could be assessed against the costs.

“The point is, is $124,000 a waste of money? Well, what’s the discounted value of a child? One day they’re going to be future taxpayers,” he said.

Labor announced in the last budget it would means-test the baby bonus, but has otherwise retained a policy it once labelled “appalling” and “poorly targeted and inefficient”.

It has abandoned the fertility argument for the baby bonus in favour of one stressing its value in offsetting some of the costs of having children.

“There are a range of views about how best to increase fertility in Australia,” a spokeswoman for Ms Macklin said.

“The baby bonus provides support to families at a time of additional financial need.”,28323,25071793-14327,00.html?referrer=email


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