The following is an excerpt of the Speech Non-Constituency Member of Parliament Daniel Goh made on 9 May 2016.
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Singaporeans are economically rational and both short-term and long-term financial security affects their decisions to have more babies. The CDA First Step grant is a welcome move towards narrowing the gap in child development resources between low-income and high-income households.
The Government should bring this policy move to its logical conclusion by automatically allocating to the CDA a standardised $10,000 for each child. It is then up to the parents to match the grant by topping up the CDA up to another $10,000 to earn higher interest and earmark savings for the child’s education and well-being. The Government could create incentives for parents to make the additional savings by making the savings eligible for income tax reliefs.
The reason we are calling for a standardised grant for each child instead of the stepwise $6,000, $12,000 and $18,000 formula for the CDA grants is because short-term financial security is a factor, especially for low-income and middle-income households. The stepwise formula is meant to be carrots to entice parents to have three babies or more. But it ignores the fact that the immediate stress and cost of raising existing children would put off parents from deciding on a third baby.
Giving a bigger grant for the existing children would alleviate the immediate stress, encourage a healthy family life and persuade parents that it is worth the while to have a third child and more.
Equalising the grants would also remove an artificial inequality within the family created by the policy. With the current policy, the third and fourth child could receive up to $12,000 more savings and grants compared to the first and second child, and the fifth child onwards could received up to $24,000 more. This means that the older children would have less funds benefitting their education and well-being compared to the younger children.
<…>I am cautiously optimistic that we are at the crossroads of turning around our declining birth rates. I am cautiously optimistic that the Government has finally found the verve after three decades to stop blaming Singaporeans for not choosing to have babies and to start addressing the structural obstacles to enable Singaporeans to have more babies.
As the lessons of three decades show, the Government cannot be reactive towards lower birth rates and should be proactive to aim for higher birth rates. And as the Government seeks to enable and empower Singaporeans to have more babies, please remember these two words as a key principle to guide pro-birth policy:Â EQUALITY MATTERS.
