Elterngeld

Elterngeld (translated literally from German as parents' money), is a tax-financed payment for couples which pays an amount of money to support the costs of bringing up a child. Elterngeld schemes exists in Germany, France, and Scandinavia.

It generally does not provide full support of the costs of bringing up a child. It is only provided for a limited period, ranging from until one year after birth until 18 years of age in Norway. The amount of Elterngeld granted depends in some places on the income of the parents.

Need for

The need for Elterngeld schemes is illustrated by the declining birth rates in Western European countries. For instance, in Germany the present birth rate is 1.3 children per woman, which is below what is calculated at the economically stable rate of 2.1 children per woman. 25 European Union states currently have birth rates below this level. The issues behind the declining birth rate include the higher costs of maintaining a child, and the greater dependence within the household budget economically on women.

Criticism

Elterngeld is effectively a third state-level subsidy for some parents – on top of maternity allowance and state income benefits. Economists argue that this has created a complex and costly system of state benefit which could be simplified and reduced in expenses.

Economists and critics also argue that the allowance creates shifting birth patterns. In December 2006, media reports suggested that German parents were seeking ways to delay the births of their children until 1 January 2007, so that they would gain access to Elterngeld of up to 25,200 euros (two-thirds of their former salary for up to a year), up from 7,200 euros per annum.[1]

Countries

Elterngeld and gender

Several proposals have been offered to use elterngeld-style payments to combat the effects of sex-selective abortion in Asia.

References

  1. 1 2 BBC NEWS | World | Europe | Pregnant Germans seek cash bonus

External links

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