You are here

Govt does more to defray early child-raising costs

Baby Bonus cash gift up by S$2,000; Medisave Grant for Newborns goes up by S$1,000

Ms Fu at the My World Preschool @ Compassvale Ancilla in Sengkang East Avenue on Tuesday, where she announced details of the enhanced Baby Bonus cash gift and the step-up in Medisave Grant for Newborns. The measures were first mentioned by Prime Minister Lee Hsien Loong at the National Day Rally on Sunday.


WHILE the government acknowledges that financial incentives are not the reason Singapore couples choose to have children, it has enhanced its Baby Bonus cash gift by S$2,000 and increased the Medisave Grant for Newborns by S$1,000 under the Jubilee Marriage & Parenthood Package.

Minister in the Prime Minister's Office Grace Fu said on Tuesday: "Monetary incentives, financial incentives, and grants - they are not the reasons to have children. That motivation must come from within ... The package is really to support (parents) - in a way, to defray their costs, make it easier for them to look after their children, support them on their journey. But it is not the reason to have children."

She was speaking at the newly-opened MY World Preschool @ Compassvale Ancilla in Sengkang, where she unveiled details of the Jubilee Marriage & Parenthood Package.

Market voices on:

The heightened support for families was first announced by Prime Minister Lee Hsien Loong in his National Day Rally speech on Sunday; the measures are aimed at encouraging families to have more children, and improving support to families during the child's first 18 months of life.

All told, families with babies born on or after Jan 1, 2015 will now receive at least S$3,000 more per child than they would have before. This comprises the new Baby Bonus Plus of S$2,000, and the S$1,000 increase in the Medisave Grant for Newborns.

The Medisave Grant comes on top of the current grant of S$3,000 - bringing the total amount of this grant to S$4,000.

Meanwhile, the enhanced Baby Bonus cash gift will be disbursed between 12 and 18 months after the child's birth, and is an add-on to the government's existing cash gift of S$6,000 for the first and second children, and S$8,000 for the third and fourth.

Additionally, the enhanced cash gift will be extended to the fifth child and beyond - instead of just the first four children. This means those with Singapore citizen babies will now receive S$8,000 for the first two children, and S$10,000 for the third and subsequent children.

Ms Fu, referring to the newly extended paternity leave, said this longer government-paid leave for dads signals a change in the way Singapore regards the role of fathers.

Mr Lee had announced that fathers will get a second week of leave to help care for their new child, up from the current one week, and that the government would foot the bill for this extra week.

The extended paternity leave will be implemented on a voluntary basis for now, with the public sector - which boasts a workforce of 141,000 - taking the lead.

Ms Fu said: "While we recognise that it's important for us to signal a shift in the norms of how we see fathers' role in the family, we have discussed this proposal with the tripartite partners. And they feel that, because of the current situation with the labour crunch and restructuring (efforts), perhaps we should give companies more time to adjust to this new requirement.

"We will be talking to other bigger companies, and hopefully, with them taking the lead, it sets the tone in the employer market. And because the labour market is competitive, if you want to attract better people and retain good staff, you will also have to follow this trend and offer as competitive a package as possible."

The estimated cost of the Jubilee Marriage & Parenthood Package will be made available in subsequent discussions, she added.

On the take-up rate of paternity leave in Singapore, the National Population and Talent Division (NPTD) said that more than 21,000 fathers have taken paternity leave as of May 2015, since its introduction two years ago.

The take-up rate was more than 40 per cent for fathers of children born in 2013.

NPTD said: "This is in line with other countries' experience, where take-up of leave started off lower, but increased gradually over time to become more widespread.

"For example, Finland's take-up rate for paternity leave was 40 per cent in 1990, 12 years after its introduction in 1978. It increased to 76 per cent in 2000 and 84 per cent in 2012."