Can Italy bribe its way out of a low birth rate?

May 16, 2016, 1:56 PM EDT
(Source: Sarah/flickr)
(Source: Sarah/flickr)

Italy's health minister Beatrice Lorenzin called for raising government benefits paid to families for having children, in order to halt the catastrophic decline in the country's birth rate. In an interview published on Sunday, she said the monthly bonus for lower income families should be twice the current €80 ($90), and she called for higher payments for subsequent children to encourage big families.

The measures would add to Italy’s already huge short-term budget deficit, but without any changes the present course would be disastrous for the country's future demographics and economy. “If we carry on as we are and fail to reverse the trend, there will be fewer than 350,000 births a year in 10 years’ time, 40% less than in 2010 — an apocalypse,” Lorenzin stated. “In five years we have lost more than 66,000 births (per year) – that is the equivalent of a city the size of Siena,” she said. “If we link this to the increasing number of old and chronically ill people, we have a picture of a moribund country.”

The “replacement rate” necessary to keep the population stable would be 2.1 children per woman, although across the E.U. women give birth to 1.58 children on average. Italy’s birth rate is even less than that, at 1.39 children. Last year had the fewest babies born in Italy since the modern state was founded in 1861, at just 488,000.

AFP wrote:

Introduced last year, the allowances are currently payable only for babies born between January 1, 2015 and December 31, 2017 up to their third birthdays. Lorenzin wants to expand eligibility to all under-threes (thereby including those born before 2015) and to extend the provision for an additional three years, covering all babies born up until the end of 2020.

The wealthiest third of parents (those with taxable earnings of over €25,000 per year) are not eligible for the scheme, while of the recipients those earning under €7,000 will get the highest monthly rates. Lorenzin’s proposals would cost €2.2 billion ($2.5 billion) over six years, according to the health ministry. The E.C. may not be thrilled at this additional expense, since it is pushing the government to lower its enormous national debt, equivalent to 130% of GDP.

The other option is for immigration to make up the demographic gap. This is more controversial, since Middle Eastern and African families tend to have higher birth rates, but their presence is not welcomed by all parts of Italian society. Certainly the child benefits won’t be paid to non-citizens.  

So if Rome wants Italians to have more children, it will have to bribe and nag them. Furthermore, Lorenzin said the drive would not be restricted to fiscal incentives. “Couples have to understand that waiting until after 35 to have children can be a problem,” she said. Only time will tell how successful these efforts are.