Based on the cohort component projection, this paper simulates the effects of fertility compression on birth sequence and age composition in Taiwan, and explores the implications for social welfare. As a first step, we fix the fertility schedule on the age, pattern of 1956 while leaving the TFR to shift as it was, simulate the single year of age population groups from 1956 to 1992. It is determined that the projected birth numbers are smaller due to the fertility compression combined with the shifting age composition in the real series. It is also shown that the simulation results in a smaller, though not significant in magnitude, old -age dependency ratio than the real series. As a second step, we subsequently assumed a fixed age pattern of fertility, a compressed pattern and an expanded pattern in a projection of five year of age groups from 1997 to 2097. Given a constant dollar and a base year population at 1992, it is shown that the variation in fertility schedules can bring about a change, ranging from 220 million to 17 million, in total maternity payment of 21,345 NT per live birth, and a change in the range of 1.1billion to -90 million in total child allowance of 3,000 NT per month per head for the first three years after birth, and a change of zero to 5.6 billion in total pension payment of 8,500 NT per month per head.