The country’s deputy prime minister said the incentive will help reassure people facing financial pressures and worried about their jobs.
“We have received feedback that Covid-19 has caused some would-be parents to postpone their parenting plans,” Heng Swee Keat told lawmakers on Monday.
“This is completely understandable, especially when they face uncertainty with their income,” he added.
Heng said the payment would help the parents with the expenses, but did not confirm how much he would be paid.
Despite a largely positive public health response to the pandemic, Singapore’s economy has been thrown into a deep recession.
Singapore has one of the lowest birth rates in the world, a statistic that successive governments have unsuccessfully attempted to reverse.
The fertility rate now stands at just 1.14 births per woman, according to its national statistical body.
Because a country repopulates itself naturally, women are expected to have 2.1 children on average, although most developed countries are now below that level, as the decline in the proportion of couples and the lesser importance of traditional gender roles have seen fertility rates drop globally.
Singapore has struggled to reverse the trend since the 1980s, with public campaigns encouraging childbirth and a series of financial and fiscal incentives unable to stop its collapse.
CNN’s Isaac Yee contributed to this report.