The contribution of recent increases in family benefits to Australia’s early 21st century fertility increase: an empirical analysis

Nick Parr, Macquarie University
Ross Guest, Griffith University

As in many European countries, in the first decade of the 21st century low fertility become a concern for Australia's government. However, following forty years of almost continual decrease, between 2001 and 2008 Australia’s TFR increased from 1.73 to 1.97. This increase overlapped with a series of changes to family-related benefits which were designed primarily to provide financial assistance to families, but for which pronatalist intent was also apparent. Of the changes, the more significant were the introduction of a universal, flat-rate payment to parents of new-born children and an increased subsidisation of child care. This paper analyses recent individual-level fertility patterns in Australia, using data from a large-scale household longitudinal survey and focusing on the effects of changes to family benefits. The effects of State or Territory level macroeconomic variables, variables measuring entitlement to family-friendly working conditions, and a wide range of individual-level control variables also are considered. The results show the effects of the ‘Baby Bonus’ and the Child Care Rebate have been slight. Age, parity, a woman’s education, income, and occupation are significant factors affecting individual fertility.