First – let’s be clear that I support a Universal Basic Income (UBI). The policy I suggest here could be used in additional to a UBI (ie. people would receive this allowance on top of their UBI), or in the context of our current welfare entitlements, as a less costly, less universal UBI.

The allowance

The proposal is simple. We give people of reproductive age $50/week if they are taking long term contraception (ie. IUD, depo, or implant).

Because the nature of our biology dictates that long term contraception is only available to women, only woman of ages say 16-40 would be eligible for this allowance.

The woman would, upon having her contraception installed, get a signed certificate from her doctor, which she can then take to her welfare office to start receiving her allowance. In the case of contraception that requires renewal (eg. depo), she would be required to bring this certificate to the welfare office every renewal period.

The contraception and doctor’s visit would be paid for by the state.

Someone women don’t suit certain certain kinds of contraception. Fortunately there are three different kinds – so it seems unlikely that a woman would be unsuitable to all three. In the case that she is – she could be given an alternative (eg. condoms if need be), and still be eligible for the allowance – unsuitability would need to have strict criteria.

The allowance wouldn’t be means tested; all women aged 16-40 would be eligible, regardless of whether they’re unemployed, a single mother, or they earn a million dollars a year. The reasoning for this allowance, is that it would provide people with immediate short term incentive to take contraception – making the default position to be not having children.

Why? Decision making – the discount rate

This necessity for this policy comes down to an economic concept called discount rate. If I were to offer you $1000 now, or $1000 in a year’s time, it would make sense that you would choose the $1000 now, as you can make some use of it now, even if just to put it in the bank to earn interest.

What if I offered you $1000 now, or $2000 in a year’s time? Depending on your situation, you might take the money now, if say you had a power bill you desperately needed to pay; if you were already plenty flush, you’d more likely take the money in a year’s time, 100%pa being a pretty good return on investment. If I was offering $1000 now, or $10,000 in year’s time, you’d be even more likely to put off taking the money.

The exact ratio of how much money I’d need to offer in order for you to delay, is what determines your discount rate. The higher your discount rate, the more money I’d need to offer you to delay; or in other words, the higher your discount rate, the less the same dollar now, is worth in a years time.

Discount rates also apply to costs. Imagine if I were selling you a new phone and you can pay $500 for it now, or $1500 in three years’ time – depending on your discount rate, you might, or might not think that the three years’ time deal is a good deal.

This same decision making factor applies to taking contraception. There’s an immediate cost of taking contraception – the time spent going to the doctor, the cost of contraception etc. There’s also a cost of not taking contraception – the potential that you have a child, (or face the decision of having an abortion), the corresponding time and money costs of raising a child.

Because of peoples’ discount rate – the cost of having a child is reduced – it’s in the future and abstract, compare to the immediate real cost of using contraception. Additionally – New Zealand’s welfare entitlement for children discounts the cost having children for those not already employed by giving increased welfare entitlement.

Anecdotally – this is reflected in doctor’s offices, where a sexually active young girl, who is not on contraception is asked ‘well what are going to do if you get pregnant?’ responds with, ‘I don’t know – receive a benefit’.

An allowance for contraception provides immediate incentive to use contraception – using contraception becomes a lot more worthwhile if you’re receiving $50 a week to do so.

Why is this necessary? What’s wrong with having children?

Firstly – global warming. The single most significant thing you can do to blow out your carbon footprint is to have children. We shouldn’t be cavalier about bringing an additional person into the world. It should be a well considered decision – which is what the allowance seeks to do – change the default from ‘having children’ to ‘not having children’.

Secondly – the social cost of additional people.

I think that the investment required to raise someone who is able to contribute to society in a meaningful manner has increased.

Where one hundred years ago – an illiterate person could have a child, and that person grows up less educated than the average person today, that person could still make a useful contribution to society – working as a labourer in a factory or building roads. This is a little glib, but all that was required to produce a useful human being, is having the person healthy and limbs intact.

Now – technology is quickly outstripping our requirement for human labour, increasingly – those jobs machines can do.

Just being educated also won’t enough. Computers are increasingly taking on intellectual jobs – for example it’s conceivable that doctors wont be required in the future – as evidence by Watson’s ability to diagnose a patient where doctors were not.

Point is – it’s not enough to accept raising a healthy child as successful parenting – there’s a rising bar for what’s required for someone to comfortably navigate the society of the future. Even if all that ‘raising the bar’ means is ‘having parents who really wanted to have you’.

And to do that – we should be delaying parenting until people really want to (enough to forego the contraception allowance), at a point where they’re presumably more prepared and capable as parents.

Immigration

There’s another reason that I think we should be raising the standard of parenting – we can make up a short fall of unskilled and semi-skilled labour via immigration.

There is an existing tension where unskilled or semi-skilled labour in New Zealand are concerned with immigrants taking their jobs.

In a global society, with increased global cooperation I don’t think it’s fair for New Zealand to shut the doors to vast numbers of people in lesser off countries to preserve the jobs of the people lucky enough to be born here.

At the same time – I’m not proposing a fully open door policy, I think cultural tensions need to be managed, but this is out of scope for what we’re discussing here.

By having less children ourselves – that increases our ability to import labour – which is a good thing, because it means that we can select the kinds of education and skills we have to fill the gaps, rather than having to reskill or acccomodate people with skills that we didn’t choose to have.

Addressing criticisms:

“This will cost a lot of money”

Using this page from Stats NZ I estimate that 802,700 are women in the 15-39 age bracket, and using this page 2,510,000* people are employed.

That gives a cost of approximately $16/week per employed person.

Personally, I’m perfectly ok spending this kind of money, and I think many other people would be too. Especially if this program was shown to reduce money spent on sole parent welfare – the cost does not seem like a lot.

*nb. Employed counts as doing at least one hour work, so this number includes people working part time. I had a hard time trying to find fulltime employment statistics.

“This is unfair, because only woman can receive it.”

Actually, I think this is good measure to address the gender pay gap.

“This is eugenics.”

The entire reason for making the allowance applicable to all women aged 16-40, is avoid the demographic targeting slippery slope.

“This targets the poor, because they’ll be more affected by the monetary incentive than a rich person.”

I agree that a poor person’s decision making will be more affected by this allowance than the wealthy.

However, what’s important to highlight is that this is giving people free money, where they wouldn’t have received it before. If someone doesn’t want to subscribe to the scheme, they don’t have to.

I would be concerned if the existence of the allowance was used as a reason to cut other entitlements. For example – it wouldn’t be fair to reduce unemployment benefits with the rationale that the cut can be made up with the allowance. But given that only woman are eligible for this contraception allowance – this is quite nicely mitigated – as you couldn’t cut unemployment welfare without affecting the men, and you couldn’t apply unemployment welfare unequally between sexes.

The argument that this policy would be bad for the poor is an interesting one – because essentially it argues against giving more money to the poor.

“This might cause people to delay having children until it’s too late.”

The argument here is that for a couple who both work lower wage jobs, they might keep putting off having children while they earn that extra $2600 a year, and it eventually be too late.

There’s a couple I’d make here:

Firstly, we have Working for Families in New Zealand, which serves to assist families on lower incomes – and I wouldn’t propose scrapping that.

Secondly – I think people who really want to have children, $50/week wouldn’t be enough to put them off. The $50/week really serves as an incentive for those who don’t really intend to have kids right now.