Lai Ching-te announces child subsidies from birth to 18 to boost economy

President Lai Ching-te attended the National Fishermen’s Day event on the 11th of this month. In addition to expressing his respect and gratitude to the hardworking fishers who toil in the nation's waters, he took the opportunity to announce a welfare measure closely tied to demographic policy. President Lai pointed out that with Taiwan’s continuous economic growth and marked increases in tax revenues in recent years, the government will begin distributing a "growth allowance for individuals aged zero to eighteen" starting in January next year. It is hoped that by combining economic and welfare measures, couples will be encouraged to start families earlier and help nurture a new generation for the country.

In recent years, Taiwan has faced the dual challenges of low fertility and population aging. The total fertility rate in 2023 was only about 1.0, far below the 2.1 required for generational replacement. To reverse negative population growth, the previous administration introduced a child-rearing subsidy of NT$12,000 per child annually in 2022; however, actual take-up rates and subsidy amounts were still deemed insufficient to offset the costs of raising children. The Lai administration’s reiteration of the growth allowance aims to enhance the visibility and distribution efficiency of subsidies, allowing more young families to experience the tangible benefits of the policy and, in turn, increasing their willingness to marry and have children.

On the fiscal front, President Lai emphasized that Taiwan's expanding tax base in recent years, particularly the growth in business tax and income tax revenues, has given the government the capacity to channel a portion of its financial resources into social welfare. Although specific budget allocations have not yet been fully disclosed, relevant departments have indicated that the growth allowance will be incorporated into the annual budget with a policy orientation of being "child-rearing friendly," avoiding cuts to other public services due to fiscal pressure. This move also responds to concerns raised by opposition parties and civil society groups regarding the fairness of welfare distribution, with expectations that the government will maintain fiscal health while expanding expenditures.

National Fishermen’s Day is an important occasion to commemorate the contributions of fishery laborers. At the event, President Lai specifically mentioned that fishers are not only guardians of marine resources, but also the cornerstone of the nation's food security. Combining demographic policy with Fishermen's Day demonstrates the government's hope to foster a societal atmosphere of "serving the nation through productivity" via the joint efforts of all citizens. This call is not only a tribute to fishers, but also conveys a message of interdependence between "family and country" to all workers, with the hope that more young people will choose to marry and have children in a stable economic and social environment, thereby building up the nation's future human capital.

However, the policy has also faced skepticism from some quarters. Certain economists have warned that merely increasing cash subsidies may not fundamentally resolve the structural problems behind low willingness to have children, as housing, childcare services, and workplace flexibility remain key factors. Opposition parties pointed out that without reviewing long-term fiscal planning concurrently, over-reliance on tax revenue growth to support welfare could create fiscal gaps during economic fluctuations. The Lai administration responded by stating that the growth allowance is part of a multi-pronged approach, and future efforts will coordinate complementary measures such as improving childcare facilities and implementing flexible working hours to form a comprehensive child-friendly environment.

Overall, by linking economic development with social welfare, President Lai Ching-te’s remarks at National Fishermen’s Day represent not only a concrete financial commitment, but also a clear statement of direction for demographic policy. If it produces the expected effects, the growth allowance may become an important catalyst for boosting the willingness of the younger generation to marry and bear children, thereby further alleviating Taiwan's demographic crisis. The future implementation and effectiveness of the policy will still require continuous observation and review to ensure that the goals of a fiscal and social win-win are achieved.