SINGAPORE: For those who have or aspire to have three or more children, the new Large Families Scheme will be welcome news.

In his Budget 2025 speech on Tuesday (Feb 18), Prime Minister and Minister for Finance Lawrence Wong announced up to S$16,000 (US$11,900) in extra support for each third or subsequent child.

Parents will see support in three components. First, third or subsequent newborn Singaporean citizens will receive S$10,000 in their Child Development Account (CDA) with a doubled First Step grant. Second, mothers will receive S$5,000 as a MediSave grant for each third and subsequent child which can be used to pay for pregnancy and delivery costs. Finally, large families will receive S$1,000 in LifeSG credits for each third and subsequent child in each year of their first six birthdays.

Together with the current Baby Bonus Scheme, the Large Families Scheme is aimed at making bigger families more affordable, from additional defraying of maternity and delivery expenses, grocery and other expenditures on newborns, and health and preschool bills.

HELPING THOSE WHO ALREADY WANT MORE CHILDREN

Targeting families thinking about a third child or more is a clever move from the perspective of trying to move the fertility needle, even if this is not the explicit goal of the new scheme.

Providing more financial support for bigger families is more effective, because the considerations whether to have another child become more cost-related at higher birth orders.

By contrast, financial support measures are generally less salient to those who currently have no children, relative to personal factors such as interest in parenthood and marital satisfaction. Trying to influence fundamental desires and marital quality requires more than providing financial support.

Encouraging families to have a third child also makes sense because it’s needed to offset national trend towards one-child and no-child families among married couples.

Based on current population trends, more Singaporean families will have only one or no child at all. Among ever-married female residents aged 40 to 49, 15 per cent had no child and 25 per cent had one child in 2024, compared with 11 per cent and 22 per cent respectively just 10 years ago in 2014.

MORE THAN INCENTIVISING BIRTHS

More help for bigger families also helps to reverse the household dilution of resources when more children arrive and hence creates a more equitable distribution of resources. It helps Singapore to come closer to the ideal where all children can thrive and be successful regardless of family background.

That’s why it is important that the Large Family LifeSG credits will not just be for families with newborns, but also for existing large families where at least one is six or younger. It’s a step in the right direction, because it demonstrates that the new policy is not just about the bottom line of incentivising births.

Rather, it is an example of a broad-based and multi-goal intervention in line with the national “Made for Families 2025” plan, which not only promotes parents’ access to flexible work arrangements, provides more parenting resources and enables greater paternal involvement, but also extends more support to groups who have more needs, including lower-income families, families with disabled members, and single-parent and divorced households.

Such a broad-based approach can better address the depth and scope of issues underlying low fertility, by showing understanding that a conducive childbearing environment is one with social security, where families with more needs are supported and the well-being of all individuals is valued.

Tan Poh Lin is a Senior Research Fellow at the Institute of Policy Studies, Lee Kuan Yew School of Public Policy, National University of Singapore.