China will cover all out-of-pocket expenses related to childbirth next year, said the country’s national healthcare security administration, as authorities try to incentivise more young couples to have children.

By 2026, China will aim to offer nationwide full reimbursement for all policy-covered medical expenses related to childbirth, including prenatal checkups, the administration said.

It would “improve the level of medical expense coverage for prenatal examinations, striving to achieve ‘no out-of-pocket expenses’ for childbirth,” it said in a report on Saturday.

The move comes as Beijing grapples with how to boost the country’s flagging population.

China’s population dropped for the first time in decades in 2022 and has continued to slide through to 2024.

Demographers expect the trend to continue due to declining birth rates, while the country’s shrinking workforce and growing elderly population is likely to create additional strains for already indebted local governments.

China’s birth rates have been falling for decades as a result of the one-child policy that was in place from 1980-2015, as well as rapid urbanisation.

The high cost of childcare and education, as well as job uncertainty and a slowing economy, have also discouraged many young Chinese from getting married and starting a family.

Some Chinese provinces, including in Jilin, Jiangsu and Shandong, have already unveiled policies to make childbirth almost free of charge.

China said in March that it would “actively” respond with policies for its rapidly growing elderly and its young people, including providing childcare subsidies and making preschool education free.

Authorities have previously tried to encourage couples to have babies by expanding maternity leave, financial and tax benefits, and housing subsidies.