The Spanish government on Friday formally approved a plan to give families 2,500 euros (3,200 dollars) per new child in a bid to raise the flagging birth rate.
First Deputy Prime Minister Maria Teresa Fernandez de la Vega said following Friday's cabinet meeting the measure would be presented to parliament in November for likely final adoption in December, when payments would start being made.
Those benefiting will be families who have had children, including adopted infants, since July 3, the day Prime Minister Jose Luis Rodriguez Zapatero announced the policy.
Zapatero justified the plan by telling lawmakers that "to continue to progress Spain needs more families with more children and families need support to have these children and resources to raise them."
Previously, child support in Spain was low compared with that of neighbouring countries such as France.
Currently, Spain pays out 450.76 euros annually for a third child while poorest families receive an additional 291 euros a year per minor.
The 2005-2006 slight increase was largely due to births by immigrants, who will likewise benefit from the measure if legally resident.
But it remains below the 2.06 children per woman the country needs to maintain its population.
Spain's 2006 birth rate was 10.92 births for 1,000 inhabitants.
The new measure is set to cost the state some 1.2 billion euros a year based on the 2006 figure for live births of 481,000, according to the INE.