BackgroundThe Australian baby bonus maternity payment introduced in 2004 has been reported to have successfully increased fertility rates in Australia. We aimed to investigate the influence of the baby bonus on maternal demographics and birth characteristics in Western Australia (WA).Methods and FindingsThis study included 200,659 birth admissions from WA during 2001–2008, identified from administrative birth and hospital data-systems held by the WA Department of Health. We estimated average quarterly birth rates after the baby bonus introduction and compared them with expected rates had the policy not occurred. Rate and percentage differences (including 95% confidence intervals) were estimated separately by maternal demographics and birth characteristics. WA birth rates increased by 12.8% following the baby bonus implementation with the greatest increase being in mothers aged 20–24 years (26.3%, 95%CI = 22.0,30.6), mothers having their third (1.6%, 95%CI = 0.9,2.4) or fourth child (2.2%, 95%CI = 2.1,2.4), mothers living in outer regional and remote areas (32.4%, 95%CI = 30.2,34.6), mothers giving birth as public patients (1.5%, 95%CI = 1.3,1.8), and mothers giving birth in public hospitals (3.5%, 95%CI = 2.6,4.5). Interestingly, births to private patients (−4.3%, 95%CI = −4.8,−3.7) and births in private hospitals (−6.3%, 95%CI = −6.8,−5.8) decreased following the policy implementation.ConclusionsThe introduction of the baby bonus maternity payment may have served as an incentive for women in their early twenties and mothers having their third or fourth child and may have contributed to the ongoing pressure and staff shortages in Australian public hospitals, particularly those in outer regional and remote areas.