Chinese President Xi Jinping wants women to have more babies. That’s proving to be a costly goal. After government-run insurance funds paying for maternity leaves suffered revenue shortfalls for the first time, Xi’s government has begun taking steps to shore up the benefits system.
The cash crunch is the result of a baby drive by Chinese officials worried that a rapidly ageing population poses a threat to economic growth. China eliminated the one-child policy in 2016 after almost four decades and since then almost every province has extended terms of maternity leave to encourage women to have more children.
Paid leave for mothers of newborns — which the government in 2012 mandated at 98 days — averaged between 138 and 158 days last year depending on the location, according to the China Daily. Insurance plans run by provincial or city governments pay the costs of maternity leave, with the money coming from mandatory contributions by employers.
The system doesn’t always cover all of the costs of maternity leave. As regional governments offer more benefits, some employers are likely to discriminate against women because of concerns they will become pregnant, said Lyu Xiaoquan, a lawyer from Beijing Qianqian Law Firm who represents women in cases related to maternity-leave policies. “The ultimate solution would be for the government and company to co-bear the costs,” Lyu said.