The Australian Law Reform Commission is currently reviewing Australia’s surrogacy laws to ensure they’re fit for purpose and reflect the population’s current views.

One aspect being considered is whether surrogates should be allowed to receive financial payments for gestating a fetus on behalf of another person or couple.

The commission’s final report is expected in July.

There are several types of potential surrogacy arrangements. Let’s look at how they work, what might work best in Australia, and how an appropriate payment could be determined.

Only ‘altruistic’ surrogacy is allowed

Surrogacy laws are inconsistent across Australia but no state or territory allows surrogates to be paid for their services.

However, reimbursement for reasonable expenses associated with the pregnancy and birth are allowed.

Currently, only “altruistic” surrogacy arrangements are permitted. This means the surrogate volunteers to carry the pregnancy and receives no financial incentive or compensation for the time or risk involved.

Other countries that only allow altruistic surrogacy include the UK, Canada, Greece and South Africa.

What is commercial surrogacy?

“Commercial” surrogacy arrangements are available in some countries around the world, meaning surrogates are able to contract their gestational services for a fee. Examples include Georgia, Ukraine and some states in the United States.

In these arrangements, the “commissioning” or “intended” parents (those who intend to raise the child) often negotiate surrogacy contracts through third-party brokers or agencies.

One study of ten surrogacy agencies in the US found significant variation in the amount commercial surrogates were paid. They report most “compensation packages” were listed in the range US$30,000–70,000, but it was not always clear what the breakdown for these packages was.

Another study of 30 specific contracts cited rates of US$18,000–$50,000, with an average payment of US$23,000.

Commercial surrogacy arrangements can vary dramatically in price and may involve transnational agreements: where the surrogate resides in another country, often one less economically empowered than that of the intended parents.

Countries have wound back ‘reproductive tourism’

“Reproductive tourism” is when individuals or couples seeking assisted reproductive services, including surrogacy, travel to places where these services are cheaper or have fewer restrictions for access.

This can lead to the exploitation of women in lower-income countries and can make surrogacy less safe for surrogates, intended parents and future children.

In India, commercial surrogacy arrangements involving foreign nationals were banned in 2015. This ban was then extended to everyone by 2022

Before this, the average payment reported for commercial surrogates was US$5,000.

This made India a popular global destination for those seeking cheaper surrogacy arrangements than in their own home country.

Thailand followed a similar pattern. Once a major hub for international commercial surrogacy, it also banned the practice in 2015.

Thai officials reported that average payments to surrogates before this time were US$10,000–15,000.

The much publicised case of “baby Gammy” a child born through commercial surrogacy in Thailand, is often cited as the catalyst for the changes in surrogacy law in Thailand and beyond.

Baby Gammy was the genetic child of an Australian commissioning couple. But he was born with Down syndrome and a congenital heart condition and was not brought back to Australia with his twin sister.

This sparked international concern over the ethical and legal obligations to children and surrogates involved in transnational surrogacy arrangements.

Read more: Baby Gammy case reveals murky side of commercial surrogacy

How is ‘compensated’ surrogacy different?

Another potential type of paid surrogacy arrangement Australia might consider is “compensated”, rather than “commercial” surrogacy.

In a compensated model, surrogates would be paid a standardised rate for each month of completed gestation, in addition to having their expenses reimbursed. The regulation of the standard fee is often considered the key difference to the commercial model, with no bidding or broker competition allowed.

Israel’s unique state-controlled surrogacy payment model is arguably one example of this type of arrangement. While still typically referred to as “altruistic” rather than “commercial”, this model does allow strictly regulated payments to compensate a surrogate’s “time and suffering”, rather than just permitting reimbursement of direct expenses.

How could this work in Australia?

If a compensated model is permitted in future, the payment rates should be comparable across the country.

Consistent prices and regulatory harmony at the federal level would ensure intended parents are not driven to travel to other states due to differences in service availability or cost.

For those who believe gestational labour should not be commercialised, no method of calculating a fair wage will be acceptable.

But for those who are open to considering a model of compensated surrogacy in Australia, it will still be necessary to determine how much is appropriate compensation.

How could a fair price be calculated?

One way to determine a fair price for compensated surrogacy in Australia would be to make the rate similar to what surrogates are paid for commercial surrogacy in other high income countries, such as the US.

But payment ranges of US$20,000–$50,000 (A$27,800–69,500) are fairly common, and some agencies promise surrogates rates as high as US$100,000-150,000 (A$139,000–208,500). So there is significant disparity in the rates paid.

Assuming surrogacy is a minimum ten-month engagement, monthly payments at the lower end of this range would be around US$2,800. If using the higher US values, monthly rates could fall anywhere between A$7,000–21,000. A US$70,000 payment translates to approximately A$10,000 a month.

As the Australian context differs from the US in many important ways, another method of determining a fair rate of compensation would be to survey the Australian public, including those with lived experience of surrogacy.

Multiple submissions to the Australian Law Reform Commission’s review of surrogacy laws suggested A$1,000–$2,000 per month would be reasonable, based on the results of these kinds of discussions. This is 20–50% of minimum wage.

Another method would be just to use minimum wage as the rate, equating to just over A$4,000 a month.

But gestational labour isn’t the same as other jobs

Just considering a few hypotheticals makes it clear we cannot just slot surrogacy into our existing workplace rules.

If we decide to pay minimum wage, for example, this is calculated on an average 38 hour work week. But pregnancy is 24 hours a day, 7 days a week. Does that mean penalty rates should apply after the first “shift” every day?

Also, this would be one occupation where it is not only possible but essential that you sleep on the job.

Would a reduced rate be payable if the surrogate was otherwise employed during the same “work hours”? Or would a surrogacy payment be better classified as an additional loading on top of their regular salary? How would surrogacy as a “second job” be taxed?

Given the health risks associated with pregnancy, what kind of hazard pay bonuses should apply? What about public holiday loading?

These questions may sound silly, but they make it clear that gestational labour will need to be considered differently to other forms of paid labour.

This should be a comfort for those who are worried that allowing compensated surrogacy might devalue pregnancy as “just another job”.

The review of Australia’s surrogacy laws is trying to ensure couples aren’t forced to travel overseas to have a family. If the commission recommends adding compensated surrogacy as an option in Australia, and the government accepts this recommendation, more debates are likely to follow.

I am a member of an internally funded grant team on surrogacy research at Swinburne University of Technology. I have previously been invited to speak on surrogacy ethics for organisations that potentially have financial interests in the topic, but have not received any payment or incentive for these talks, and all content presented was free from external influences and represented my personal views, rather than those of any institution I was employed by at the time.