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Generous childcare subsidies have been reported across China as part of the country’s holistic efforts to boost birth rates, making news headlines and sparking heated discussions.

The latest news came from Hohhot, capital of northern China’s Inner Mongolia Autonomous Region. The city announced last week that it will offer a one-time subsidy of 10,000 yuan (US$1,394) to couples having their first child. A second child will receive 10,000 yuan per year until he/she reaches 5 years old.

For the third child or more, the annual subsidy is 10,000 yuan until the child turns 10, with the total amount reaching 100,000 yuan, a relatively high amount compared with other cities and roughly twice the annual income of local citizens.

According to the NHC, over two-thirds of China’s provincial-level regions are exploring a birth subsidy system. Shenzhen's relevant departments have revealed that the city is working to implement the NHC plan in accordance with national arrangements.

This came on the heels of the recent conclusion of the annual national legislative session, during which the government work report was adopted. For the first time, the report vowed to provide childcare subsidies.

“We will formulate policies to boost birth rates, provide childcare subsidies, vigorously develop integrated nursery and childcare services, and increase public-interest childcare services,” the report reads.

During the legislative session, Director of the National Health Commission (NHC) Lei Haichao said that the commission was working with relevant departments to draft a childcare subsidy operational plan. Lei added that the public would see direct, beneficiary measures and corresponding policy arrangements in due course.

The inclusion of childcare subsidies in the government work report signals China’s commitment to supporting fertility intentions with tangible financial assistance, said political advisor Ni Bangwen. He called for further efforts to issue comprehensive measures to support childbearing families.

Previous incentives

Local governments have already started taking action. More than 20 provincial-level regions in China had explored offering childcare subsidies at different levels, according to earlier data from the NHC.

For instance, Shenyang, the capital of northeastern China’s Liaoning Province, provided a monthly subsidy of 500 yuan to local families for their third child until the child turns 3, according to a document issued in 2023.

The birth incentives have proved feasible and effective in Tianmen, a fifth-tier city with a population of 1.6 million in Hubei Province. Since the city implemented birth-boosting measures last year, the number of newborns in the city rose by 17% last year after declining for eight consecutive years.

Demographic challenges

As one of the world’s most populous countries, China faces profound demographic challenges due to a dwindling number of newborns and a growing aging population. The country’s birth rate and number of newborns both dropped for seven consecutive years before reporting rises in 2024, while the population aged 60 and above reached 310 million last year.

To boost its birth rate, China has implemented a slew of supportive policies in recent years. It phased out its one-child policy by allowing married couples to have two children in 2016 and announced support for couples looking to have a third child in 2021.

In addition to financial support, other incentive measures include increased childcare services, extended maternity leave, and strengthened support in education, housing, and employment, all of which aim to foster a birth-friendly society.

Childcare services have been improved nationwide to create better situations for parents. Moreover, maternity leave in China has been generally extended to over 158 days, along with spousal paternity leave and parental leave, making new mothers feel increasingly supported.