Wednesday, April 18, 2007

Stating the bleedin' obvious

Baby bonus 'a waste of money'

THE baby bonus is being wasted on people who would have babies anyway, a Queensland economics academic says.

Professor Ross Guest of Griffith University's Business School also believes the bonus is unnecessary because the population will continue to grow naturally.

The baby bonus of $4000 is given to mothers on the birth of their children. It will rise to $5000 from July 2008.

Since its introduction in 2004, Treasurer Peter Costello has credited the bonus, along with an increase in childcare places and the childcare rebate, for boosting Australia's birth rate.

Prof Guest, the author of a recently published report titled The Baby Bonus: A Dubious Policy Initiative, today said the scheme was extremely inefficient.

"It's looking like the baby bonus has contributed at least to the up-tick in the fertility rate in Australia, but that doesn't make it good public policy," Prof Guest said.