Opinion & Commentary
Children Missing in the Young Country
To keep the level of Australia’s population steady, without immigration, an average of 2.1 births per woman is needed. Today, our birth rate is 1.7 births per woman—well below the level needed to reproduce ourselves. In 1960, the birth rate was 3.4 births per woman—double the present rate. Each year about 246,000 babies are born and about 90,000 foetuses are aborted. Our present immigration program brings in about 90,000 people each year, and, in relation to our population, this is one of the largest, if not the largest, immigration programs of any country in the world. Yet immigration on this scale, combined with our present birth rate, will not be sufficient to stop our population declining in about 50 years’ time.
But the problems begin long before then. From next year, the growth of our working age population will begin to decline, and the Federal Treasury points out that within 20 years we will be adding only 40,000 15 to 64-year olds to the population compared to 200,000 a year at present. We will become a country starved of oncoming young workers and disproportionately populated by older people and the retired. In the cautious language of the Treasury, " these emerging trends in the labour force suggest a possibility that Australia’s trend Gross Domestic Productivity growth could be lower over the coming decade than during the 1990s".
Apart from the economic consequences of falling fertility and the long-term defence implications of a static or falling population and a dearth of young men and women, there is something dispiriting about a supposedly "young" country being unable, or unwilling, to reproduce itself at a time when we have never been richer overall. Why the momentous turnaround in fertility in the last 40 years?
'From next year, the growth of our working age population will begin to decline'
It has been forgotten that at the height of the baby boom of the 1950s and 1960s powerful voices began to be raised against population growth. They warned against a catastrophic "explosion" of population in Western countries and the importance of reducing fertility. The attitudinal and ideological groundwork was laid in the 1960s and 1970s for a movement away from a vision of children and family life as a fulfilment for both women and men to one where marriage became much more uncertain, a career became an imperative consummation for women, abortion was acceptable without question, and reduced fertility a national, if not a global, duty.
By the late 1970s and 1980s atransformation had taken place. Family law, and social and taxation policies formerly oriented towards supporting family formation and the costs of children were largely reversed in favour of policies that encouraged women to take up careers, that made divorce easier, family life less stable, and the rearing of children relatively more expensive, thus providing further incentives for women to enter the workforce and for couples to have fewer children.
In 1960, a single income family of dependent wife and three dependent children earning 150 per cent of average weekly earnings, after deductions and child allowances, paid no income tax and had a final disposable income 3 per cent above its earned income. A comparable family today earning 150 per cent of average weekly earningsloses about 20 per cent of its earned income after taxation and family allowance are taken into account. Such a family is therefore 23 per cent worse off compared to the 1960 family, and, in money terms today, this represents an income disadvantage of $13,800. This indicates how much more costly it is, in relative terms, to have children today compared to 40 years ago. Important reasons for this change are unemployment, and welfare expenditure, which have raised the burden of taxation on working families. The welfare bill, after adjusting for inflation, has grown from $470 per head of population in 1960 to almost $2000 per head of population today.
'Once a low birth rate has been operating for many years, recovery can be very difficult'
When it becomes significantly more expensive to have and rear children, it is inevitable that fewer will be conceived and more conceptions will be aborted.
But in the long run, the social and economic costs are great. Once a low birth rate has been operating for many years, recovery can be very difficult and long drawn out; and sometimes may be impossible. The chickens of the last 30 years are coming home to roost. We can never replace the missing children, but it is possible to start taking measures now that will halt the slide. The place to begin is public policies which will more realistically acknowledge the way in which taxation and niggardly approaches to the costs of children have decimated our birth rate.
The state pays about $4000 per child per year to indigent families. If the dependent children of all families were to be guaranteed a like amount by way of taxation rebates, or tax thresholds or allowances, we would be treating all children equally and providing a powerful incentive for all parents and potential parents to recast their views about what children would cost them. If it were the only child-related payment, it could replace the present complex system of child care subsidies and variable family allowances that are unfair to many. This would make the vast majority of families better off and couples better able to contemplate having children. And it would cost very little more than the present system. It might even cost a great deal less in the long run.
About the Author:
Barry Maley is Senior Fellow and Director of the Taking Children Seriously research programme at The Centre for Independent Studies.
