Estonia: debate about parental allowance
The liberal Estonian government has announced plans to cut the country's generous parental allowance. Under the current rules, one parent receives his or her full salary until the child reaches the age of 18 months. The scheme was introduced in 2003 to address the low birth rate in the post-Soviet years, which in the meantime, however, has risen to around 1.6 children per woman, roughly the European average. The plans have triggered fierce debate in the national press.
Reform not a bad idea
Eesti Päevaleht finds the plans worth considering:
“From a scientific point of view, parental allowance is by no means as cost-effective as people think it is. [Estonia's largest independent think tank for socio-economic research] Praxis points out that although the birth rate increased after the introduction of the benefit, it did not lead to people having children at a younger age, for example. In the meantime, the boost effect has disappeared entirely. It must therefore be clear that the state's ability to encourage people to have more children remains very limited, no matter how expensive the measures. On the other hand, there are ideas on how the money could be better used.”
Absurd in a population crisis
Postimees, on the other hand, is furious:
“Even though Estonia currently has the lowest birth rate in a hundred years and we are facing a demographic crisis - in other words, if the current trends continue, we will die out as a nation - the government thinks it's a good idea to consider cutting parental benefits. This is accompanied by rhetoric about means-tested benefits - which could mean that wealthier parents should not receive benefits for as long as poorer parents - and, more generally, that money can't buy children. This is undoubtedly true, but unfortunately money is imperative for raising children in today's Estonia, which has become an expensive Nordic country.”