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"Populate or perish" came the cry in the 1930s when Australia's leaders were sufficiently concerned by the nation's sluggish birth rate that they encouraged their fellow countrymen and women to adopt the missionary position with evangelical zeal. Procreation became a patriotic imperative.

The calls became even more insistent after World War II, when the bombing of the Northern Territory and the Japanese advance into what was then called New Guinea heightened fears in Canberra that the low birth rate posed an existential threat to the nation's long-term future.

Prospective parents answered the call, and by 1961, the height of Australia's post-war baby boom, the country's fertility rate stood to 3.55 per woman. By 2001, however, it had slipped back to an historic low, at 1.73 a woman - a decline attributed partly to the decision by prospective parents to delay having children.

The concern now was of the greying of Australia: of how to finance the welfare entitlements of an ageing population. In the early 1970s, when Australia remained a relatively youthful nation, a third of the population was aged 15 years or younger. By the turn of the century, this proportion had fallen to just 22%.

So on budget night in 2004, Peter Costello, the then Treasurer, came up with his own version of "populate or perish". Introducing his popular "baby bonus", a financial pay-out for each newborn, he urged his fellow Australians to have "one for mum, one for dad and one for the country".

The purse strings were opened and the patriotic nerve was well and truly tweaked. So much so that by 2006 the number of births reached 265,922, the second highest figure on record and the best in 30 years. As he hoped, Costello's bonus had proved a baby booming success.

For the canny Treasurer there was also another dividend. By providing a lump sum payment which parents could spend however they chose, he blunted calls for statutory paid maternity leave - a right which mothers in Australia still do not enjoy.

I raise this subject not only because it was Mothers Day in Australia on Sunday - hope all you far-flung Aussies remembered - but, more importantly, because it is budget day on Tuesday, the Rudd government's first.

In the lead-up, there's been a lot of speculation as to whether the baby bonus will survive in its present, universal form - a one-off payment of $A4187 ($3,934, £2,020) (and $A 5000 from July). Looking to slash government spending - a recent Treasury report suggested the Howard government had all the fiscal profligacy of an inebriated mariner and that public spending was at "unsustainable" levels - the government's "razor gangs" might target the bonus.

Kevin Rudd has already hinted that the baby bonus should be means tested - implying that the promise of a few thousand dollars to a millionaire hardly produces a stampede towards the bedroom. A number of leading economists have come out and said that it's an "unbelievably expensive" way to achieve a higher birth rate. The Business Council of Australia derides the bonus as "middle class welfare" and says it should be means tested.

So should it survive in its present form? Or should the baby bonus, as some headline writers have gleefully put it, be thrown out with the bath water?

Equally, is it time to rethink whether there should be statutory paid maternity leave? After all, Australia and the US remain the only developed nations not to have such a scheme. When the idea of national paid maternity leave scheme by 2010 was floated at the recent 2020 summit it did not even make the shortlist.

Or would means testing the baby bonus be part of Labor's plan to soak the rich? There's already been talk of a "Robin Hood" budget, and leaks about a new tax on luxury cars. Curious political strategy for a leader who's built his success on reaching out to voters who have traditionally been suspicious of Labor.

When it comes to boosting fertility, perhaps it is time for a new slogan. "Make more working families", might be a favourite in government circles, whose members have seemingly been programmed to include the phrase "working families" in every sentence that leaves their voice box. "Lie Back and Think of Australia?" might be a better ice-breaker. Perhaps there should be a more imaginative incentive scheme, in the frequent-flyer mould. I'd love to hear your suggestions.

Many of these are ultimately questions, of course, for the Treasurer Wayne Swan. Born in 1954, Mr Swan was himself a product of the post-war baby boom, and, like his boss, Kevin Rudd, is the proud father of three children. As the Treasurer has proved, when it comes to populating or perishing, actions speak louder then words.

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