China is considering paying couples to have a second baby after the scrapping of rules limiting family sizes failed to produce an expected baby boom.
Authorities imposed a "one-child policy" for almost four decades which was enforced with mass sterilisations, coerced abortions and violent intimidation from officials.
Beijing relaxed the intrusive regulations in January last year after fears there were too few young people to support the growing ranks of elderly.
The increase of 1.3 million births was below initial expectations that up to three million extra babies would be born every year for the next five years.
China has promised to improve support for new mothers and is considering regulations that would establish nurseries at workplaces and extend maternity leave.
However, the financial burden of having a second child has been cited in official surveys as a key reason why most couples do not wish to enlarge their families.
Wang Pei'an, vice-minister of the National Health and Family Planning Commission, admitted that "barriers" still existed for many couples.
"To have a second child is the right of each family in China, but affordability has become a bottleneck that undermines the decision," he told a recent conference, reported the China Daily.
Wang said "birth rewards and subsidies" would be considered, the first time China has hinted at such a measure according to the newspaper.
There were a total of 17.8 million births last year in China, with the birth rate rising from 1.54 to 1.6 children per woman.
China hopes to increase its birth rate to 1.8 by 2021, but it is facing severe demographic challenges as it experiences a rapid decline in women of child-bearing age. One mother who gave birth to her second child in December said the government should have learnt its lesson on interfering in people's personal lives.
"I wasn't allowed brothers or sisters, and now we are being told that we should produce siblings for our children?" she said.
Many people took to the internet to mock the turnaround by family planning officials.
"It will be absolutely no surprise to me when in the future the government forces people to have sex so that they can produce children," said one comment on Sina Weibo, China's version of Twitter.
The ruling Communist Party has claimed that the one-child policy is a major factor behind the country's rising prosperity.
China's working population - estimated at roughly 907 million at the end of 2016 - is expected to drop by around 32 million by 2030. By 2050, 30 per cent of Chinese will be aged 60 or over, the United Nations estimates.