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Eventually, if the population continued to decline, there would be no real government left, I agree. In the OP I was thinking more about what the government might do in the early stages, when people first noticed the situation.
A related topic to think about: the human species has a naturally high birth rate and a high death rate, compared to many other animals. That's how it stayed in balance with its ecosystem through most of history. That changed when modern medicine arrived a few centuries ago. The birth rate stayed about the same, but the death rate went way down. Of course, the population exploded.
If the birth rate suddenly dropped, and people lost access to modern medicine, that would be a serious one-two punch to the human species.
Governments and religions will get their pocketbooks hurt first. Lots of jobs lost in governments. Then the domino effect will kick in.