Germany to Pay Parents to Stay Home

The German parliament on Friday passed new legislation aiming to raise one of the lowest birth rates in Europe by allowing parents to take paid leave to look after newborn children.

The parents of children born after Jan. 1, 2007 who have stopped work to look after the child will receive 67 percent of their net salary up to a ceiling of 1,800 euros ($2,280) a month for a year.

That could be extended to 14 months if the father undertakes the childcare for at least two months. Or if both parents want to be off work simultaneously, they can each receive the payment for seven months.

Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift:  Germany has one of the lowest birth rates in Europe

Parents can also benefit from the new measure if they work less than 30 hours a month. The payments will be increased by 10 percent for each additional child aged under six years in the household.

'Historic'

"This is historic," said Family Minister Ursula von der Leyen, herself a mother of seven and a member of Chancellor Angela Merkel's conservative Christian Democrats. "This law will fundamentally change things for parents and their children."

Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift:  Both fathers and mothers can stay home in the plan 

Von der Leyen told the Bundestag that she expected a quarter of fathers would take a break from their careers to look after their children from 2007, compared with just 5 percent currently.

The new measures will cost 3.9 billion euros a year and reflect the determination of Merkel's coalition government to raise the German birth rate, which, at 1.36 children per woman, is one of the lowest in Europe  -- along with Italy and Spain.

Opposition says insufficient

The low birth rate is a major cause of concern in the biggest economy in the European Union.

The government has already introduced measures to try to encourage Germans to have more children, including tax breaks for childcare. More daycare places have also been promised.

The opposition Free Democrats, Greens and the Left Party voted against the new measures on Friday, judging them insufficient to make a substantial impact.

But countries such as Denmark and Sweden have experimented with parental leave payments and increased daycare with great success.