Japan approves Bill to tackle declining birth rate by boosting child allowances

Tokyo [Japan], February 16 : The Japanese Cabinet on Friday approved a Bill to deal with the country's declining birth rate by expanding the coverage of monthly child allowances to high school-age children, Kyodo News reported.
The Bill underlines Japanese Prime Minister Fumio Kishida's efforts to tackle the sharp decline in birth rate in the country, according to the report.
According to the plan, the existing income limit for households receiving the benefits will be removed and a new funding scheme will be set up, requiring each person to pay an additional 300 to 500 yen (USD 2 to USD 3.3) in the form of monthly health insurance premiums from fiscal 2026.
It will start in October this year, and the eligibility to receive 10,000 yen a month will be expanded to those aged between 16 and 18, according to Kyodo News.
Moreover, the current 15,000 yen monthly allowance for the third child and beyond will be doubled to 30,000 yen.
Child allowances are currently designed to assist parents and guardians of children up to age 15 when many finish junior high school in Japan.
Ayuko Kato, the minister in charge for Child Policy, said, "We will ensure seamless support and substantially increase the benefits that child-rearing households receive."
Reportedly, the reasons behind the declining birth rate in Japan are late marriages and financial worries.
Kishida's government sees the period leading up to the 2030s as "the last chance" to reverse the trend, as reported by Kyodo News.
Moreover, the government has planned to boost annual spending on child care and bring it to 16 per cent of the gross domestic product from 11 per cent. The level is as equal to Sweden, known for its extensive child-related support.
This spending plan has been taken forward despite Japan's fiscal health being the worst among advanced economies.
In fiscal 2028, the Japanese government aims to start collecting 600 billion yen at first and increase it to 1 trillion yen under the new funding scheme.
Other features include increasing benefits for low-income single parents with three or more children and ensuring those taking childcare leave can receive more benefits, reported Kyoto News.
As the availability of daycare facilities is critical for working parents, the government plans to expand childcare support for children between the ages of six months and two years.
They will further make the service available to anyone, irrespective of their employment status, from April 2026 nationwide.
According to reports, Japan had around 2.09 million newborns in the midst of its second baby boom in 1973. However, it slipped below 1 million in 2016 and below 800,000 in 2022 for the first time.