Japan’s Low Birth Rate: Govt Must Confront Necessity of Securing Funding

The government’s advocation of unprecedented measures to address the nation’s low birth rate lacks realism due to ambiguity surrounding the funding to support such policies. Concrete steps must be expeditiously presented regarding how to share the burden of child-rearing support.

Last year, the number of Japanese newborns hit a record low of 770,000. If the decline in the birth rate fails to be halted, the economy will slow, and it will be difficult to maintain national strength.

In its strategic policy for children’s future compiled in June, the government decided to abolish the income limit for child allowances and expand coverage to high school students. The strategic policy also specifies an increase in benefits for childcare leave for a certain period after giving birth.

The policy emphasizes financial support aimed at encouraging marriage and childbearing among younger generations. The goal to eliminate financial concerns related to child-rearing is understandable.

The government clearly states in the strategic policy that additional annual funding in the mid-¥3 trillion range will be secured to implement these measures, but it is problematic that there is no mention of solid plans to secure such funding.

In the strategic policy, the government outlines steps to secure funding through such means as “thorough expenditure reform,” and the creation of a tentatively titled “support fund system,” under which the public would bear a broad share of the burden.

“Expenditure reform” is a go-to phrase used by the government when it has yet to identify specific funding; the same phrase has been used in relation to the planned increase in defense spending. In reality, costs for medical and nursing care services are increasing due to the graying of the population, and it will be difficult to achieve drastic spending cuts.

In terms of the envisaged support fund system, the government is considering asking the public and business owners to bear an additional financial burden by incorporating the necessary increases into premiums for the social security system, such as health insurance and medical care for the elderly. However, a blueprint for the support fund system has yet to be fleshed out.

The government apparently is avoiding specifics for fears of a wide public backlash, including from elderly individuals and businesses.

Encouraging the birth of future generations will increase the number of people who can support the social security system. It will likely be vital, too, for people not directly involved in child-rearing to share the burden of measures to combat the falling birth rate. The importance of intergenerational support must be emphasized persistently.

The government has said that the support fund system “will not create additional burdens in real terms.” It seems to be saying that there will be no additional public burden because social security expenses will be curbed and the surpluses will be used for measures to combat the low birth rate. However, this approach sounds like placating the public.

It is imperative for the government to debate head-on the issue of asking the public to take on a further burden and gain the public’s trust regarding the planned measures.

It is crucial, too, to work toward ensuring sustainable wage increases and quality housing. It is hoped that the government will consider measures that are expected to be effective from a broad perspective.

(From The Yomiuri Shimbun, Sept. 20, 2023)