Changes to Baby Bonus for under 18 Year Olds

Young mums will be supported from 1 January 2007 in managing their Baby Bonus through payment by instalments.

The Minister for Families, Community Services and Indigenous Affairs, Mal Brough, said that the compulsory incremental paympent system for those under 18 years of age would address community concern about the vulnerability of younger mothers.

"The Government had resolved to maintain the lump sum payment for the Baby Bonus generally for adults, because most people deal with the payments responsibly and the intent of the policy is to help families with the immediate costs of having children.

"The reality is, the current baby boom is largely in the 30-35 year old age group and responsible adults can and should be trusted to make judgements appropriate to their circumstance about how best to use the Baby Bonus.

"We did look at many of the claims about increased teenage pregnancy and the data doesn’t support many of the claims that have been made. However, on balance, we also felt that the younger a person is, the higher the risk of vulnerability and the less their experience with larger sums of money.

"Because of this increased risk the Government decided to err on the side of caution and make instalment payments of the Baby Bonus mandatory for those under 18. From January 2007 payment by instalments will be the preferred option for this age group with legislation to be introduced early next year to make instalments mandatory.

"These changes will be made incrementally, with changes to guidelines coming into effect as of the 1st of January next year and corresponding legislation requiring these instalments effective from July 1, 2007.

"We are also developing an education campaign on the reality of the financial responsibilities of parenthood to ensure young people are not mistakenly attracted to parenthood by the prospect of short term financial gain.

"The Government will also be making legislative changes to require all parents to formally register the birth of their child as a condition of receiving the Baby Bonus. This will require the agreement of the State and Territory governments and I will be consulting with them in the weeks to come.

"An increasing number of parents are delaying registration of births, in some cases until many years later. Precise birth statistics are needed so governments can ensure they are accurately planning funding for future service delivery such as funding for schools and health."

Mr Brough said the Baby Bonus, which has benefited more that half a million families since its introduction in July 2004, is another demonstration of the Howard Government’s commitment to supporting Australian families.

Further information on Baby Bonus and instalments will be available on the Family Assistance website.