China unveils nationwide childcare subsidies

China on Monday introduced a nationwide childcare subsidy program, which will start from this year as part of broader efforts to support families and encourage childbirth.

The program will offer families 3,600 yuan (about $503) per year for each child under the age of three.

The subsidies will be exempt from individual income tax and will not be counted as household or individual income when identifying assistance recipients, such as those receiving subsistence allowances or classified as living in extreme difficulty.

The policy is expected to benefit more than 20 million families each year. The State Council Information Office will hold a press conference on the topic of childcare subsidy system and fertility support measures at 2 p.m. on Wednesday.

"The childcare subsidy policy is a timely relief. It will play a very important role in reducing the childcare burden of families and further building a child-friendly society," Ma Liang, professor at the School of Government at Peking University, told China Media Group (CMG) in an interview.

"The childcare subsidy system implemented this time is very inclusive. Basically, the subsidy is given as soon as a child is born, not just for the second or third child," said Ma.

"Raising children is a very important social responsibility, and the labor of giving birth and raising children also has very important social value and significance. This policy is a very good value orientation, advocating that the whole society respect the social value of raising children," He Dan, director general and research fellow of the China Population and Development Research Center, told CMG. 

"This policy also leaves ample room for local governments to formulate more locally appropriate fertility support policies," she added. 

Local government actions 

As one of the world's most populous countries, China is facing a dual demographic challenge: a shrinking number of newborns and a rapidly aging population. The country's birth rate and total number of newborns declined for seven consecutive years before experiencing a modest rebound in 2024. Meanwhile, China's population aged 60 and above had reached 310 million by the end of last year.

The national childcare subsidy was first introduced in this year's annual government work report in March. Multiple local governments have piloted similar programs over the last few years – some of which have offered notably generous incentives – as part of their own efforts to address these challenges.

Hohhot, the capital of north China's Inner Mongolia Autonomous Region, grants one-time subsidy of 10,000 yuan (about $1397) for the first child in each family. A second child receives an annual subsidy of 10,000 yuan until the age of five, and any further children are eligible for the same amount annually until the age of 10.

Shenyang, the capital of northeast China's Liaoning Province, provides a monthly subsidy of 500 yuan (about $70) to local families with a third child until that child turns three.

Notably, Panzhihua in southwest China's Sichuan Province – the first city in China to offer such subsidies – has witnessed positive growth in its permanent resident population for four consecutive years.

Meanwhile, the county-level city of Tianmen in central China's Hubei Province saw a year-on-year increase of 17 percent in its newborn population in 2024 – significantly higher than the national average of 5.8 percent, and ending an eight-year decline. Among the 7,217 newborns in Tianmen last year, more than half were second or third children.

Song Jian, professor at the School of Population and Health, Renmin University of China, told CMG that support policies at multiple aspects need to be exerted at the same time as a package to achieve ideal results. 

"For China, the situation of families is different, and there are also great differences across regions. The childcare subsidy policy introduced by the country this time plays a role in providing a bottom line," she said.

(With input from Xinhua)