Europe turns to benefits and migration to boost birth rates

Europe turns to benefits and migration to boost birth rates

Smaller numbers of babies and larger totals of old people present different challenges for capitals across Europe. Times correspondents report

A newborn baby in San Sebastian, northern Spain, which is hoping that migration will lift its birthrate

ALAMY

Foreign Staff

Wednesday January 29 2020, 5.00pm GMT, The Times

Europe’s shrinking and ageing populations are causing headaches in capitals across the continent. Without more babies, more workers, or both, families and governments will increasingly struggle to care for their people.

From cash-for-babies to a scramble for migrant workers, governments are experimenting with initiatives to keep their public finances and families afloat. Our correspondents examine what is working where.

Policies introduced by successive Angela Merkel governments have stabilised German’s birthrate at the European average 1.57 births per woman. But an ageing population continues to be a problem and the government believes that inward migration is the key to tackle the issue

ODD ANDERSEN/GETTY IMAGES

Germany
Germany’s birth rate plummeted in the 1990s due to a slump in eastern Germany during the economic upheaval that followed unification.

But it has been recovering due to a mixture of government benefits for parents and an increase in migration in the course of the refugee crisis.

Governments under Angela Merkel, who has been in power since 2005, have sought to boost the birth rate by making life easier for working parents. The cornerstone of the policy was the introduction in 2007 of Elterngeld or Parental Allowance that pays women two thirds of their last income for a period of one year. If the father takes time off, the duration of the allowance is increased to 14 months. The system was beefed up in 2015 allowing couples to receive the allowance for two years if they both work part-time for the period.

In addition, the government in 2013 introduced a law entitling every child to a place in a kindergarten from the age of one.

Studies show that such measures boost the birth rate, which has been rising in Germany since 2011, reaching 1.59 birth per woman (bpw) in 2016 and currently amounting to 1.57 bpw, in line with the European average.

However, that birth rate will not stop Germany’s society from ageing dramatically, with the proportion of over-65s expected to jump to 27.3 percent in 2035 from 21.6 percent in 2017, according to a forecast.

Experts say migration is the key. The government has realised it needs to take steps to attract more skilled workers. The mindset has gradually changed from 20 years ago when conservative politicians were still insisting that “Germany is not a country of immigration.”

In Berlin, the regional Office for Foreigners that processes residence applications has recently been renamed to the Regional Office for Immigration.

From March, rules requiring companies to seek skilled employees from within Germany and the EU first will be relaxed, with the aim of attracting an extra 25,000 skilled workers to Germany each year.

A study commissioned by the Bertelsmann Foundation last year concluded that Germany will need immigration of at least 260,000 every year until 2060 to keep the demographic decline in the workforce to levels acceptable to the economy. (David Crossland)

Greece has one of the lowest birthrates in Europe and new mothers are given €2,000 to encourage births

GETTY IMAGES

Hungary & Poland
In Hungary, which has a birth rate of just 1.48 bpw and whose population is forecast to shrink from 9.8 million to 8.3 million by 2050, the conservative nationalist government of Viktor Orban recently announced free in-vitro fertilisation (IVF) treatment to couples at state-run clinics.

Mr Orban favours a “procreation over immigration” approach to deal with demographic decline. His government is also considering an income tax exemption for women who have three children or more. Those with at least four children have been exempted since the start of this year.

Other measures include a £25,000 loan to families that is forgiven if they have three children, and cash incentives for large families to buy seven-seater vehicles.

In Poland, the national conservative Law and Justice (PiS) government is pursuing a similar approach. Under its “500+” child-benefit programme, parents can receive a tax-free benefit of £100 per month for the second and any consecutive children until they reach the age of 18.

Low-income families are also eligible for the benefit for their first child. The benefit is available to all children, not limited to those born after the programme was launched in 2016, amounting to about 12 per cent of the average gross wage in Poland that year.

It appears to be having an effect. According to figures from Poland’s Central Statistics Office, there was a 13 to 15 per cent increase in childbirth between December 2016 and January 2017.

In addition, the government is keen to tempt back the 900,000 Poles living in the UK. Recent figures show a net return of Poles to Poland for the first time in nearly a decade, due to fears over Brexit and Poland’s booming job market. (David Crossland)

Some countries see new arrivals in Europe as a way of stabilising their populations and providing workforces for the future in societies with ageing populations

ANNE CHAON/GETTY IMAGES

Italy
Stay-at-home mothers and baby sitting grandparents were once expected to take care of children. Italy’s politicians are beginning to realise that families — and today’s working mothers — need state support if the country is to reverse its sinking birth rate.

The crisis looks almost irreversible with the number of new births dropping to 440,000 in 2018, the lowest since records began in 1861 and 140,000 fewer than in 2008. Women are averaging 1.29 children, far lower than the 2.1 required to maintain the population.

Italians once regarded children as future earners and as such an incentive to have large families. By the 1980s, however, children became regarded financially as more of a cost, and the birth rate began to dip.

The government is trying to catch up. From this year it is to fund free nursery places for all and is adding €2 billion to the budget for child care benefits. Plans are also underway, copied from Sweden, to increase paternity leave from seven days to a month.

“Sometimes men need to understand they have a responsibility for children too, and this plan aims at a cultural change,” said Francesca Puglisi, a junior labour and social policy minister . “We have a real problem with births but we hope to reduce the cost of children for thousands of families and give more confidence to people who dream of being parents.” (Tom Kington)

Spain’s ability to attract immigrants in recent years has led to a historic national population high — 47.1 million. One in eight residents were born outside the country

LIGHTROCKET/GETTY IMAGES

Spain
Spanish regions have turned to migrants to try to maintain populations, offering incentives ranging from jobs to free housing and schools.

Spain is one of the biggest economies among countries with a low birth rate — along with Greece, Portugal and Italy. However, its ability to attract immigrants in recent years has led to a historic national population high — 47.1 million. One in eight residents were born outside the country.

However, more than two out of three inhabitants are concentrated in one per cent of Spain’s surface area, so while major cities are growing, many mid-size towns and villages are emptying.

Regional incentives have been launched. In La Mata de los Olmos, in the remote depopulated area of Aragón, the 280-strong pueblo is just about holding its own because it has attracted Senegalese, Romanian and Moroccan workers by offering jobs in its cured meats factory and slaughterhouse.

But the regional solutions often encounter difficulties in keeping their new inhabitants. Jobs and schools are not always nearby, prompting, for example, Latin Americans who migrated to rural Spain to later move to the cities to seek better lives.

Longer term solutions include encouraging more births, but the Spanish government spends a fairly low level of public funds on benefits and tax breaks for families.

In Portugal migrants are needed to fill unskilled jobs and help offset low birth rates. Antonio Costa, the Socialist prime minister, has said one of his priorities is to make immigration easier by scrapping a quota system that linked migrant entries to labour market needs. (Isambard Wilkinson)

France
France is not growing old as fast as many of its neighbours, thanks to a high number of births and the arrival of mainly young immigrants in recent years. However, there are concerns over the medium term because the birthrate, at 1.87 bpw, is gradually declining while life expectancy, already one of the highest in Europe, continues to rise.

In 2017, the last year with comparative data, France had kept its place as Europe’s most fertile nation, with 1.90 bpw, ahead of Sweden, at 1.78 and Ireland at 1.77.

This is the result of a century of of pro-natal policies to encourage child-bearing and large families. These were launched in 1919 after the huge human losses in the First World War. Since the Second World War, France has provided generous monthly family allowances and income tax benefits that rise steeply from the second child onwards and also free nursery and pre-school child care.

The National Union of Family Associations called last week for a “relaunch of family policy” to boost the birthrate. It blamed cuts in child allowances and deteriorating infant care at day centres.

The population is ageing nevertheless. Twenty per cent of the population is 65 and over, compared with 16 per cent in 2003. Life expectancy is now 85.6 for women, second only to Spain in Europe, and 79.7 for men, in ninth position in Europe.

The constant growth of the population over recent decades to 67 million has slowed down and is expected to begin slowly shrinking within a few years. The net number of births over deaths was 141,000, the lowest figure since 1945. (Charles Bremner)

Greece
Greece, with one of the lowest birthrates in the European Union, this month launched a desperate bid to encourage families to have more children.

Mothers are to receive €2,000 for every newborn. Low-income families, mainly in remote and underdeveloped regions of the country, will receive tax breaks.

Greece is still reeling from eight-exhausting years of austerity that left over a million people jobless and saw 500,000 young people leave in the biggest brain drain of an industrialised nation.

Abortions, already among the highest in the EU, have increased by some 50 percent.

Today, just over seven births are being recorded for every 1,000 Greeks, three times fewer than a generation ago.

Greece’s population fell to 10.8 million in 2015 from 11.1 million four years earlier. Experts anticipate it will fall to 8.3 million by 2050. By then, 36 percent of Greeks will be over 65 compared with 21 per cent today.

The government of Kyriakos Mitsotakis has made it a priority to woo back young professionals. In a recent campaign, Rebrain Greece, the government vowed to subsidise high-paying jobs, promising monthly pay cheques of at least €3000 to returnees. (Anthee Carassava)

Mothers in Poland can receive a tax-free benefit equivalent to £100 per month for the second and any consecutive children until they reach the age of 18

RICHARD BAKER /GETTY IMAGES

Balkans
Germany’s efforts to plug its labour shortfall is robbing Balkan states of their youth.

Twenty years after the end of the Yugoslav wars, the biggest problem facing the Western Balkans is hastening depopulation that is stripping the young out of the region.

According to some estimates, Serbia will lose a quarter of its 7 million population by 2050. The governments in Bosnia and Kosovo, both ethnically divided and fragile states, often massage demographic statistics for political ends, but here too, young people are deserting, mostly for western Europe.

Kosovo has lost 10 percent of its population in the past decade; Bosnia has lost a fifth of its pre-war population.

The situation has been exacerbated by Germany’s new policy of issuing working visas to skilled migrants from the Western Balkans in a bid to plug its labour shortfall.

So far, neither the Bosnian nor Kosovan government has come up with policies to reverse the trend. But in Belgrade, President Vucic has announced an incentive that hands women money for having children. Based on a sliding scale up to the fourth child, it could be worth as much as £27,800 over the course of 10 years — a huge amount in a country where the average salary is £17,900.

However, feminist critics have blasted the policy as “humiliating and degrading to women”. (Hannah Lucinda Smith)