Experts propose to improve the mother capital program

Four years of decline in the issuance of new certificates coincided with the period when the amount of maternity capital was not indexed (from 2015 to 2019), writes Tkachenko.

The maternity capital program for the second and subsequent children began to operate in 2007 and was supposed to end in 2016, but the program was extended until 2018 inclusive, and then until 2021. In February 2020, President Vladimir Putin announced the start of issuing maternity capital for the first children born on January 1, 2020. In June 2021, the duration of the program was extended by another five years, until the end of 2026.

At the time of its appearance in 2007, the mother’s capital was equal to 250 thousand rubles, by 2015 its size increased to 453 thousand rubles, but ceased to be indexed until 2019. Starting from 2022, the cost of the certificate is indexed to actual inflation, and not forecast, by order of Putin. On February 1, 2022, maternity capital in Russia increased by 8.4% – according to the actual inflation of the previous year.

The first period of maternity capital (2007-2016) as assistance to families at the birth of a child meant a sufficient horizon for the family to plan the birth of children, but then the measure was extended for 2-3 years, the expert recalls. “Such sporadic decisions cannot positively influence the reproductive plans of the family, especially those related to the birth of second and third children,” Tkachenko argues. From the point of view of policies aimed at solving demographic problems, and the psychological perception of economic incentives in their long-term impact, “it is useless to increase capital for two years before the completion of the project, as was done in 2018,” he believes.

“There is a reasonable suspicion that the decisions made were primarily determined by budgetary possibilities, and not by the goals of family and, even more so, demographic policy,” the scientist points out.

The Ministry of Labor and Social Protection reported to RBC that the duration of state programs directly depends on the needs for them and the effectiveness of their impact on the task assigned to them. “The practice of applying various state support measures is constantly being monitored. So, for example, with regard to maternity capital, taking into account the importance and relevance of the program, a decision was repeatedly made to extend it, ”the department noted.

The Research Institute of Labor (a research structure of the Ministry of Labor) stated that “the scientific journal publishes research by various authors, including if their position does not coincide with the position of the editors.” The office of Deputy Prime Minister Tatyana Golikova, who oversees demography, forwarded questions to the Ministry of Labor.

NES Professor Evgeny Yakovlev agrees that the relatively short-term extensions of the maternity capital program did not have a significant impact on the birth rate. “The first ten years of the program are an absolute success. Initially, the measures introduced led to an instant result: in the summer of 2007, nine months after the announcement of the reform, the birth rate in Russia jumped by 10% and then continued to grow, ”he writes in a commentary for bulletin Accounts Chamber dedicated to maternity capital. However, after 2017, the birth rate and the effect of the maternity capital program began to decline.

The conditions for extending the program could be one of the reasons for the decline in the birth rate, coupled with a decrease in the real cost of mother capital and a deterioration in the external economic situation, Yakovlev confirmed in an interview with RBC. In 2021, the number of children born in Russia decreased by 2.3% compared to 2020, a decrease in the indicator has been observed since 2014 (Rosstat data).

Regarding the spread of mother capital to the first child, the NES professor pointed out that “on the one hand, it was really important to stimulate the birth rate of first-borns, since they began to give birth less”. “However, in the long term, we have repulsed the incentives to give birth to second and subsequent children, and this is exactly what is required to reproduce the population and increase the birth rate,” says Yakovlev.

“From my point of view, it would be more rational to introduce a more proportional allocation of subsidies – for the first children in the amount, for example, one third of the capital for the second and subsequent ones,” he believes.

In turn, Alexander Tkachenko believes that in order to support demographics, the authorities should think about introducing universal benefits for children, regardless of the level of family income. “A comparison of the so-called “child beneft packages”, an analysis of their evolution in countries with different economic development models could be of great importance for modifying the national project “Demography” and the Russian system of family benefits, which so far applies only to poor families “, – the expert notes. He cites the example of monthly allowances for children up to three years of age, introduced since 2018, which are intended only for low-income families (with an income of less than two regional subsistence levels per family member). These allowances are “connected to the family’s poverty and trying to help them not slide even lower,” Tkachenko adds.

In his opinion, the transition to more children’s payments can be beneficial for children in terms of developing human capital. “Families with children invest material and financial resources in a child as future human capital, spending money, financing stays in kindergartens and schools, their spiritual potential and, most importantly, free time,” the expert writes.

In addition to direct cash benefits, in developed countries, families with children are supported by benefits through a tax deduction (tax beneft), or a combination of these support measures, Tkachenko points out. In Russia, a system of tax deductions for families with minor children also exists, but dimensions the standard deduction per child is too small. At the birth of the first or second child, the tax base can be reduced by 1,400 rubles. per year, at the birth of the third and subsequent – by 3 thousand rubles.

Yakovlev, in turn, warns that the effect of any measures to support the birth rate may be temporary or not at all pronounced; this is a worldwide problem. “For example, when a monthly payment for mothers was introduced in Germany, the birth rate jumped up, but then quickly returned to normal. In Spain and almost all European countries, except France and England, despite stimulation and cash injections, the birth rate remains low, ”the expert comments. According to him, “an effective population policy is not so easy to construct.” “The experience of countries needs to be studied, but it will not always be positive,” Yakovlev states.

The Ministry of Labor said that the analysis of the experience of applying various demographic measures in other countries by the department is “continuous”. “Including the results of this analysis, various proposals are being formed to expand measures to support families with children,” the ministry added.

The Accounts Chamber in September 2021 following the analysis of the mother capital program notedthat this is an important measure of social support, which is “highly demanded by the population.” Most of the funds received by families are used to improve their living conditions. At the same time, the department pointed out several inconsistencies in the implementation of the program, including restrictions on the types of spending of mother capital. The results of a survey conducted by the Accounts Chamber showed that 17% of citizens would like to receive at least part of the funds in cash.