Government increases cash incentive to boost birthrate
The government is looking for ways to defuse Greece’s demographic ticking time bomb.
A series of measures were announced on Monday, including one-off allowances for new parents, an increase in the maternity allowance, an adjustment in the income criteria for heating subsidies, the introduction of a reduced electricity tariff for families with children and a restructuring of the child allowance for public sector workers.
The measures drew criticism from opposition parties, which underlined that they marginally cover the cost of baby formula for a couple of months and that the demographic problem cannot be solved with haphazard measures that are nothing more than publicity stunts.
Any support measure is obviously welcome, but one-off allowances are not sufficient for providing meaningful support to young families, let alone for tackling the crux of the issue. What is urgently needed is a policy that helps shrink the gap between high prices and cheap labor, as well as more investments on services and infrastructure.
A series of recent reports have found that the country’s active population is shrinking and emigrating, while the remaining Greeks are aging, seriously undermining the country’s long-term economic growth prospects.
The issue has been described by the Prime Minister Kyriakos Mitsotakis as “a direct undermining of the country’s ability to generate wealth on a personal and collective level, so as to preserve in this way the strong fabric that unites the citizens.”
According to data released by the Greek statistics service, ELSTAT, last week some 73,000 births were registered in 2023, the lowest performance since the collection of data started.
UN data show that Greece will be one of the 20 countries with the largest population decline in the world by 2050 by 13.4%, which means a drop to below 9 million by 2050. According to the Greek think-tank IOBE (Foundation for Economic & Industrial Research), by 2100 it could shrink to 8.3 million.
In a recent conference on the demographic issue, organized by the Economist, Social Cohesion and Family Minister Sofia Zacharaki said the ministry is working on an action plan, which will be delivered to the PM in early May.
University of Thessaly demography Professor Byron Kotzamanis sounds the alarm on the constant deficit of births over deaths, but also the demographic imbalances, with the “over-concentration of the population in an extremely limited part of the territory.”
He underlines the need for a combination of measures that will “limit the increase in deaths in the coming decades, create an extremely favorable environment for the acquisition of the desired number of children by the younger generations, significantly slow down the migration of young productive age groups, allow the return of part of those who have left, allow the integration and permanent settlement of new foreigners in our country and reverse the overcrowding of the population.”
The role that migratory flows can to at least partially help tackle the issue should also be thoroughly discussed.
“After the 2015 migration crisis, we had to achieve a balance,” said Zacharaki, adding that there is a need for a fair system with the integration of migrants and employment options in sectors such as hospitality and agriculture.
