This is yet another episode of rich-city problems that Nairobi can never relate to. The City of Hong Kong proposes to “reward” new parents in the city with over Ksh 300,000 ($ 2,500) for having babies. Apparently, the city is grappling with a very low birthrate that is threatening the future of Hong Kong and China at large.
Hong Kong Chief Executive John Lee Ka-Chiu announced that the money will be paid for each baby born until 2026. As this may seem commendable, residents of Hong Kong have decried that the money is barely enough to even cover housing expenses.
The city of Hong Kong records a birth rate of 0.9 births per woman which is relatively lower than the recommended rate of 2.1. Consequently, the city has an unstable population balance due to a low birth rate and high life expectancy rate. As is the case in most Asian countries, China has a higher number of old people compared to young people. A situation that subsequently tends to affect the economy since it puts a strain on the working population of a country.
The City of Hong Kong is Paying New Parents Over Ksh 300,000 to Boost Birth Rate. Photo| The Atlantic
Compared to other Asian countries, Hong Kong’s handout is low. Singapore, which has a birth rate of 1.05 is paying its residents Ksh 1.2 million ( $ 8,036) for every first and second child. For every third child, the city offers payment of up to Ksh. 1.4 million ( $ 9,497. To further boost their birth rate, a four-week paternity leave is offered alongside 16 weeks maternity leave. Additionally, there is also an unpaid infant care leave and tax relief for working mothers.
On the other hand, South Korea with a birth rate of 0.87, pays its residents Ksh 78,000 ( $ 518) per month for a year, for childbearing. According to reports, this amount is set to increase to Ksh 110,000 ( $ 740) per month, next year. Japan is paying its residents Ksh 16,000 ( $ 107) per month for each child for two years. On top of that, it is also paying parents Ksh 10,000 ( $ 66.7) per month for each child between three years and 17 years. The country has a birth rate of 1.3.
The reason why a one-off payment of Ksh 376,000 may seem low to Hong Kong residents is because of the high cost of living in the city. Hong Kong is among the most expensive cities in Asia. On average, a two-bedroom flat in the city rents at Ksh 340,000 ( $ 2,253) per month. This coupled with the already rising expenses of baby products and nursery services makes the handout appear as a joke.
Although Hong Kong offers subsidies for education from kindergarten to senior high, it does not do the same for nursery period. The year or two before kindergarten level are covered by parents. On average, the cost of nursery is Ksh 115,000 ( $ 766) per year. Alternatively, hiring a nanny to look after the children costs the entire Ksh 376,000 ( $ 2,500) per month. As a result, those on low income can neither afford childcare services nor take a break from work to look after children.
It appears as if Hong Kong may fail in its bid to motivate its citizens into childbearing. Raising a child is an affair that draws long-term financial concerns such as health care and education. However, the China government has pledged to speed up access to public housing for families with children. It has also promised to increase the capacity of public childcare services.
In response, residents of Hong Kong have suggested more ways in which their government could encourage them more. They suggest that the government provide housing allowances, subsidies for nurseries, and extended paternity and maternity leave.
Hong Kong residents argue that the government has a long way to go in convincing them that the city is conducive to childbearing. According to them, even if anyone wanted to give birth, they would not do it for the amount being offered by the government. Moreover, those finding their current financial condition stressful will not be tempted to add more to their plate for the going rate.
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