The government on Wednesday rejected the idea of significantly increasing a subsidy for new parents, saying it would be too big of a financial burden.

Since last month, the government has been offering a one-off payment of HK$20,000 for each newborn, to try to encourage more people to have babies.

But Liberal Party chairman Peter Shiu said the government should boost the amount for grassroots families to annual payments of HK$40,000 for at least five years.

Deputy Chief Secretary Warner Cheuk said such a move would be too costly.

"The estimated expenditure incurred by the proposal would reach tens of billion of dollars. This is a colossal financial burden and not a good use of resources, either," he told Legco.

He also dismissed the idea of a tax deduction for families with children that hire foreign domestic helpers.

However, Cheuk said the government would consider a suggestion of textiles sector lawmaker Sunny Tan that the business sector be encouraged to offer discounts to parents and to provide more family friendly policies for their workers.