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UNCLAS SECTION 01 OF 11 TOKYO 002772
SIPDIS
SIPDIS
DEPT FOR E, P, EB, EAP/J, EAP/P, EAP/PD, PA;
WHITE HOUSE/NSC/NEC; JUSTICE FOR STU CHEMTOB IN ANTI-TRUST DIVISION;
TREASURY/OASIA/IMI/JAPAN; DEPT PASS USTR/PUBLIC AFFAIRS OFFICE;
SECDEF FOR JCS-J-5/JAPAN,
DASD/ISA/EAPR/JAPAN; DEPT PASS ELECTRONICALLY TO USDA
FAS/ITP FOR SCHROETER; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR;
CINCPAC FLT/PA/ COMNAVFORJAPAN/PA.
E.O. 12958: N/A
TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 06/20/07
TOKYO 00002772 001.2 OF 011
1) Top headlines
2) Editorials
3) Prime Minister's daily schedule
4) Assistant Secretary Hill in Tokyo: Mid-July meeting likely for
next round of six-party talks; BDA fund issue has been resolved
5) LDP's historical education panel concludes that the Nanjing
Massacre was bogus
Political agenda:
6) Upper House elections set for July 29 due to 12-day extension of
current Diet session
7) Opposition parties react sharply to 12-day extension of Diet
session
8) Ruling and opposition camps clash in the Diet yesterday
9) Three education-reform bills to be enacted today
10) North Korea human rights bill amendment passes Lower House
11) Small party wants ex-Peruvian president Fujimori as an Upper
House candidate
12) Former Foreign Minister Machimura of the LDP: If the election
were held today, the LDP would be defeated
13) Lawmaker Muneo Suzuki, Foreign Ministry official Sato - both
arrested five years ago for ODA scam - write book attacking the
ministry
Defense affairs:
14) Iraq special measures law extension clears Upper House committee
15) Defense Minister Kyuma called "anti-SDF" by opposition lawmaker
in the Diet
16) Kyuma, defending SDF monitoring of civilians, says whole nation
is subject to surveillance
17) MHI, Boeing form tie up to produce a domestic passenger plane
for Japan
18) Government's newly released "big-boned economy policy
guidelines" called "boneless"
Articles:
1) TOP HEADLINES
Asahi, Yomiuri, Sankei & Tokyo Shimbun:
3 killed in Tokyo spa blast
Mainichi:
Three education reform bills to be enacted today
Nihon Keizai (Nikkei):
Companies to be allowed to apply on behalf of employees to integrate
pension records
Akahata:
JCP Chairman Shii urges Prime Minister Abe to immediately send
pension premium payment records to 100 million policyholders
2) EDITORIALS
Asahi:
TOKYO 00002772 002.2 OF 011
(1) Structural reform advocacy cannot be seen in 2007 "big-boned"
reform policy guidelines
(2) Palestinians should make efforts for reconciliation
Mainichi:
(1) 2007 basic economic guidelines: Is "a beautiful country"
economic policy?
(2) Pneumoconiosis lawsuit: Government must correct its mistake
Yomiuri:
(1) Economic guidelines must be fleshed out
(2) Need for strict elevator inspections
Nihon Keizai:
(1) Prime Minister Abe should implement reform measures rather than
list them
(2) International community must fight terrorism to bring stability
to Afghanistan
Sankei:
(1) 2007 economic policies short of reform guidelines
(2) Basic Space Law: Debate for effective use of space urged
Tokyo Shimbun:
(1) Full picture of unidentified pension premium records fiasco
remains unclear
(2) Lack of explanations of bill revising the Iraq Special Measures
Law will invite public distrust
Akahata:
2007 economic guidelines: Consideration to business circles will
deepen vicious circle
3) Prime Minister's Official Residence (Kantei)
Prime Minister's schedule, June 19
NIHON KEIZAI (Page 2) (Full)
June 20, 2006
08:02
Met with Deputy Chief Cabinet Secretary Suzuki.
08:30
Attended a meeting of the Urban Revitalization Headquarters in the
Diet building. Then attended a cabinet meeting. Foreign Minister
Aso, MLIT Minister Fuyushiba and MEXT Minister Ibuki remained.
10:00
Upper House Education, Culture, and Science Committee.
12:28
Arrived at the Kantei.
13:15
Upper House Education, Culture, and Science Committee.
18:10
Meeting of the Council on Economic and Fiscal Policy at the Kantei.
18:24
Arrived at the official residence.
TOKYO 00002772 003.2 OF 011
19:32
Special cabinet meeting at the Kantei. Foreign Minister Aso
remained. Then met with Deputy Chief Cabinet Secretary Matoba.
20:01 Returned to the official residence.
4) Visiting US Assistant Secretary of State Hill says next round of
six-party talks "will be held in mid-July" with "resolution" of BDA
issue
ASAHI (Page 4) (Full)
June 20, 2007/06/20
US Assistant Secretary of State Christopher Hill, chief negotiator
in the six-party talks, yesterday arrived in Tokyo and when asked
about North Korea's frozen funds at Banco Delta Asia (BDA) in Macao,
he confirmed that the money was sent to a Russian bank, noting, "As
far as I know, the money has been sent to North Korea's bank
account." He stated that the BDA issue has been generally resolved.
He was replying to reporters at Haneda Airport.
Earlier in the day in Seoul, where he was visiting ahead of Japan,
Hill spoke of the question of the provision of energy to North Korea
and expressed hopes that Japan would play an active part to
facilitate the denuclearization of North Korea, saying, "I hope to
see Japan join the provision.
Late yesterday, Hill met with his Japanese counterpart in the
six-party talks, Kenichiro Sasae, director-general of the Asian and
Oceanian Affairs Bureau of the Foreign Ministry and regarding the
BDA issue, he told Sasae: "It has been in principle resolved." Both
officials agreed on the need for both Japan and the United States to
work in close cooperation to resolve the pending issues between
Japan and North Korea, including the abductions of Japanese citizens
by North Korea. After the meeting, Hill, when asked about when the
next round of the six-party talks will be held, made this comment:
"I hope the next meeting will take place by mid-July."
5) "Nanking Massacre was a fabrication," a parliamentary panel of
lawmakers says
SANKEI (Page 5) (Abridged)
June 20, 2007
The Council to Consider the Future of Japan and History Education
(chaired by former Education Minister Nariaki Nakayama), a
parliamentary group of like-minded lawmakers of the ruling Liberal
Democratic Party, yesterday held a press briefing in Tokyo, in which
it unveiled the results of a fact-finding survey of the Nanking (TN:
Nanjing) Incident and indicated a plan to seek in the months ahead
to remove groundless descriptions, photos, and other materials
displayed at the anti-Japanese war memorial museum in China.
The council had also analyzed newspaper articles issued at the time
of the capture of Nanjing since this past February and listened to
views of informed individuals about those articles. The facts the
council found through the survey include that: (1) there was no
description of a massacre found in domestic and foreign press
articles; and (2) a Chinese government representative stated before
the League of Nations in 1938 that "20,000 people were killed and
thousands of people were injured in violence in Nanjing," but this
TOKYO 00002772 004.2 OF 011
speech was not included in a resolution denouncing Japan.
The council has concluded that the Nanking Massacre was a
fabrication and nothing more than political propaganda. The council
intends to seek to remove inappropriate descriptions and
anti-Japanese photos coming from unnamed sources displayed at
anti-Japanese war memorial museums in China. Also, it intends to
point out errors in facts in films dealing with the Nanking
Incident.
On the question of how many people were killed in the capture of
Nanjing, the council refrained from mentioning the number by noting:
"At the time, the Asahi Shimbun and the Mainichi Shimbun were major
press companies that sent the largest numbers of reporters to
Nanjing, but they did not determine the number of victims. Given
this, it's impossible for lawmakers to mention the number."
6) Upper House election likely to be held on July 29
MAINICHI (Page 1) (Excerpts)
June 20, 2007
The government and ruling coalition decided yesterday to extend the
current Diet session, which will end on June 23, for 12 days until
July 5. If the session is extended for 12 days, based on the Public
Office Election Law the official campaign for the House of
Councillors election will start on July 12 and the polls will take
place on July 29, a week later than the initially expected July 22.
The ruling Liberal Democratic Party (LDP) and its coalition partner,
New Komeito will make a formal decision on the extension within one
or two days and their secretaries general will propose it to Speaker
of the House of Representatives Yohei Kono. The speaker will then
put the extension proposal to a vote at a Lower House plenary
session by June 22. The standoff will inevitably intensify between
the ruling bloc and opposition camp, which has criticized the ruling
coalition for using a strong-arm approach in steering the Diet.
Prime Minister Shinzo Abe is determined that the 12-day extension of
the ongoing session is necessary to play up his government's effort
for reforms for the upcoming Upper House election by enacting such
key bills as one amending the National Civil Service Law . Although
an extension of five or less days does not affect the original
schedule of holding the Upper House race on July 22, thinking that
the five days are not insufficient for deliberations on important
bills, the ruling side, including the LDP Upper House caucus, agreed
on the 12-day extension.
LDP Upper House Caucus Secretary General Toranosuke Katayama stated
in a press conference yesterday: "We must prioritize the enactment
of the bills even though the extension will affect the voting day."
He indicated in his remarks that the extension of the session for 12
days is absolutely necessary.
7) Battle between ruling and opposition camps intensifies due to
ruling bloc's decision to extend Diet session for 12 days
MAINICHI (Page 5) (Excerpts)
June 20, 2007
The government and the ruling parties decided to extend the current
Diet session for 12 days, delaying the Upper House election to July
29. All opposition parties furiously reacted to the step, calling it
TOKYO 00002772 005.2 OF 011
partisan politics. The decision to delay the election for one week
has sparked mixed reactions in the ruling bloc, with some hopeful to
see a weakened public outcry over the pension debacle and some
others anticipating fiercer criticism of the Abe administration. The
ruling camp's arm-twisting approach to priority bills has inflamed
the opposition camp's antagonistic stance in the Diet in its closing
stage.
Minshuto (Democratic Party of Japan) Secretary General Yukio
Hatoyama in a press conference yesterday criticized the ruling bloc,
saying: "I can sense the ruling camp's intention to divert public
attention form the pension debacle. It's an act that derides the
public." Japanese Communist Party Head of the Secretariat Tadayoshi
Ichida also criticized the ruling bloc's decision, describing it as
an attempt to enlarge the sumo ring as it is about to be pushed out.
Social Democratic Party head Mizuho Fukushima referred to it as a
quintessentially self-centered action.
The row between the ruling and opposition blocs intensified
yesterday. The ruling parties rammed the bill amending the Iraq
Special Measures Law and three education reform bills through the
Upper House Foreign Affairs and Defense Committee and the Education,
Culture and Science Committee. In reaction, the ruling bloc plans to
submit to an Upper House plenary session today a resolution removing
the two chairs from the posts.
8) Ruling bloc forcibly takes vote on three education reform bills;
Opposition camp to file no-confidence motion against Lower House
speaker
TOKYO SHIMBUN (Page 2) (Abridged slightly)
June 20, 2007
With the ongoing Diet session scheduled to close on June 23, the
confrontation between the ruling and opposition camps intensified in
both chambers of the Diet yesterday. The ruling coalition bulldozed
three education reform bills and a bill amending the Iraq Special
Measures Law through the Upper House Education, Culture and Science
and the Foreign Affairs and Defense Committees. In a Lower House
plenary session, the ruling bloc also adopted a motion barring
Minshuto (Democratic Party of Japan) lawmaker Akira Uchiyama from
attending a Diet session for 30 days. The opposition camp put up
do-or-die resistance, with three parties -- Minshuto, the Social
Democratic Party, and the People's New Party - submitting a
no-confidence motion against Lower House Speaker Yohei Kono.
The Lower House plenary session that was scheduled to vote on the
penalty motion against Uchiyama began shortly after 5:00 p.m., four
hours behind schedule, due to the opposition camp's stiff
resistance. The motion was adopted by a majority vote backed by the
Liberal Democratic Party and the New Komeito. The Minshuto, SDP, PNP
lawmakers walked out of the session before a vote is taken, and the
Japanese Communist Party members voted against the motion.
In reaction, Minshuto, the SDP and PNP submitted a no-confidence
motion against Lower House Speaker Kono saying, "The huge coalition
allows no questions in running the Diet. The punishment against Mr.
Uchiyama is extremely irresponsible." The no-confidence motion
against Kono is scheduled to be put to a vote today.
The Education, Culture and Science and the Foreign Affairs and
Defense Committees also conducted Deliberations, but when members
TOKYO 00002772 006.2 OF 011
finished asking questions, Yasu Kano and Tadashi Taura declared an
end to the question-and-answer session. The bills cleared the
session despite resistance from opposition members. The ruling bloc
intends to enact them in an Upper House plenary session today.
In reaction to the bills' passage, Minshuto decided to submit to an
Upper House plenary session today a resolution removing Kano and
Taura from the respective committees.
The opposition camp is becoming increasingly antagonistic toward the
ruling bloc, as seen in the fact that it walked out of an Upper
House Health, Labor and Welfare Committee session and rejected
asking questions at an Upper House Cabinet Committee meeting.
9) Ruling camp ready to pass three education bills today
MAINICHI (Top Play) (Excerpts)
June 20, 2007
Three education-related bills were adopted by a majority from the
Liberal Democratic Party and the New Komeito in a meeting of the
House of Councillors Education and Science Committee last night. In
the session, opposition parties approached the chairperson's desk
and offered strong objections. The government and the ruling parties
intend to enact the bills, to which Prime Minister Shinzo Abe is
giving top priority in the current Diet session, in an Upper House
plenary session today. Both the ruling parties submitted a 22-item
supplementary resolution, including a measure to boost the education
budget. The council adopted the resolution, but rejected four bills,
including a counterproposal by the Democratic Party of Japan
(Minshuto).
The bills adopted yesterday are those revising the School Education
Law, the Local Education Administrative Law, and the Teacher's
License Law. The prime minister said in a question-and-answer
session: "In an era of increasing economic globalization, it is
necessary for people to become healthy and strong enough to survive
global competition. It might be a part of education to bring up
persons to have competitiveness, strength, and beautiful mind."
The revised School Education Law defines "patriotism" as "a mind
that loves the nation and homeland," regarding cultivating such a
mind as one purpose of compulsory education. The law also proposes
establishing in schools new posts such as vice principal. The
revised Local Education Administrative Law will create the
government's authority to give instructions or correction orders to
education boards, reviving the correction-order right, which was
abolished in 1999. New provisions will also be established to allow
education boards to give advice or aid to private schools by
prefectural governors.
10) Bill revising the North Korea Human Rights Law clears Lower
House
YOMIURI (Page 4) (Full)
June 20, 2007
An amendment to the North Korea Human Rights Law aimed at
restricting the government from providing any new economic
assistance to North Korea unless the issue of abductions of Japanese
citizens by North Korea makes progress was approved by a majority
from the governing Liberal Democratic Party, the major opposition
TOKYO 00002772 007.2 OF 011
Democratic Party of Japan (Minshuto), and the junior governing
coalition partner New Komeito in the Lower House plenary session
yesterday. The bill was sent to the Upper House.
11) People's New Party asks Fujimori to run for the Upper House
election
YOMIURI (Page 4) (Full)
June 20, 2007/06/20
The People's New Party (PNP) is considering fielding former Peruvian
President Fujimori (68) in the upcoming Upper House election,
sources revealed yesterday. PNP Acting Representative Shizuka
Kamei's secretary visited Fujimori, who has been under house arrest
in Chile and asked him to run for the election. Whether Fujimori
will run for proportional representation or in a Tokyo constituency
is being discussed in the party. Reportedly, Fujimori refrained from
giving a prompt answer. Fujimori has Peruvian nationality as well as
Japanese nationality. Under the Public Office Election Law, he is
qualified to run for a national election in Japan.
12) LDP's Machimura, Tsushima, Koga: If Upper House election held
now, LDP will lose seats
ASAHI (Page 4) (Full)
June 20, 2007
Former Foreign Minister Nobutaka Machimura, former Health and
Welfare Minister Yuji Tsushima, and former Liberal Democratic Party
Secretary General Makoto Koga got together yesterday in a Japanese
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restaurant in Tokyo. The three senior LDP members shared the
perception on the July Upper House election that if the election
takes place now, the LDP will lose seats. They confirmed that the
need for all the party to be represented in fighting in the Upper
House race.
13) Suzuki and Sato criticize Foreign Ministry at party celebrating
publication of their book five years after their arrest
MAINICHI (Page 5) (Abridged slightly)
June 20, 2007
A talk show was held in Tokyo yesterday to celebrate the publication
of a book titled, Looking Back: Where Did We Go Wrong? (Hansei:
Watashitachi wa naze shippai shita no ka?) coauthored by House of
Representatives lawmaker Muneo Suzuki, who also heads the New Party
Daichi, and former Foreign Affairs Ministry Intelligence and
Analysis Bureau chief analyst Masaru Sato, who is on leave. Suzuki
and Sato were arrested five years ago in 2002 on suspicion of
accepting bribes and other charges, and breach of trust,
respectively. Sato is still appealing. At the party, Suzuki said, "I
knew too much about the Foreign Ministry, and that's why the
ministry suddenly reversed its position." Sato highlighted the need
for the ministry officials to get rid of the mistaken elitist
mentality.
14) Iraq law clears Diet panel
SANKEI (Page 5) (Full)
June 20, 2007
A bill to revise the Iraq Special Measures Law for extending the
TOKYO 00002772 008.2 OF 011
Self-Defense Forces' activities in Iraq for two years passed the
House of Councillors Committee on Foreign Affairs and Defense
yesterday with a majority of votes from the ruling coalition. The
bill is expected to clear the House of Councillors in its plenary
setting today. However, there are critical voices from within the
ruling Liberal Democratic Party about stipulating the SDF's overseas
activities in a special measures law and renewing the government's
masterplan almost every year to continue SDF activities overseas.
"The SDF is being used as a political tool," one LDP lawmaker
complained. Another has noted that the SDF cannot respond to
situations at once. It will likely be a political challenge after
this summer's election for the House of Councillors to create a
permanent law that will make it possible for Japan to send the SDF
overseas as needed.
The Air Self-Defense Force has sent three C-130 transport planes and
continues its airlift support for the Iraq-based multinational
forces and the United Nations. The government will make a cabinet
decision in July to adopt a masterplan that extends the ASDF's
mission in Iraq for another year.
Meanwhile, the Antiterror Special Measures Law, under which Japan
has sent a Maritime Self-Defense Force squadron to the Indian Ocean,
will also expire in November this year. A bill to revise this
special measures law will also be before the Diet during its
extraordinary session to be called this fall. The LDP, in its
manifesto for the upcoming House of Councillors election, will
advocate establishing a permanent law for SDF activities overseas.
15) DPJ's Mashiko rebuts Kyuma
TOKYO (Page 2) (Full)
June 20, 2007
The Ground Self-Defense Force's Intelligence Security Corps was
recently found to have collected information about groups and
individuals opposed to Japan's dispatch of the Self-Defense Forces
to Iraq. In this connection, Teruhiko Mashiko, a member of the
leading opposition Democratic Party of Japan (Minshuto), was
referred to as a person conducting "anti-SDF activities." On this
issue, Mashiko and Defense Minister Fumio Kyuma faced off in a
meeting yesterday of the House of Councillors Committee on Foreign
Affairs and Defense.
Mashiko opposed the SDF's Iraq dispatch in a January 2004 meeting of
SDF veterans. This was described in the GSDF's in-house document as
"anti-SDF." Taking up this fact, Mashiko bitterly criticized the
GSDF's information-gathering activities. "I'm worried that civilian
control may not work and we may be back in the prewar situation."
Kyuma stated before the committee: "They classified remarks into two
categories, such as 'pro-SDF' and 'anti-SDF' remarks. That's the
same as in the Cold War days, and it was habitual. We'd like to
study how to classify them." This was all Kyuma could say,
indicating he would think twice about using such categories.
16) Whole nation subject to monitoring: Kyuma
MAINICHI (Page 5) (Abridged)
June 20, 2007
Defense Minister Fumio Kyuma, sitting in yesterday on the House of
TOKYO 00002772 009.2 OF 011
Councillors Foreign Affairs and Defense Committee, defended the
Ground Self-Defense Force's Intelligence Security Corps over its
collecting of information about civic groups and other targets
opposed to the activities of the Self-Defense Forces in Iraq. "When
it comes to the Self-Defense Forces' activities, organizations, and
security, we can't say it's illegal to check every group," Kyuma
stated before the committee. "Even lawmakers could be equally
subject to information gathering as well as all other people of the
country," Kyuma added. With this, Kyuma indicated that the whole
nation could be monitored.
Kyuma was replying to questions asked by Shinkun Haku and Teruhiko
Mashiko from the leading opposition Democratic Party of Japan
(Minshuto).
Kyuma avoided referring to the authenticity of GSDF documents
disclosed by the Japanese Communist Party over the GSDF Intelligence
Security Corps' information-gathering activities. However, the
defense chief stressed the legitimacy of such activities, saying,
"We can't conclude it's wrong to collect information." Meanwhile,
the documents classify collected information into categories like
"anti-SDF." In this respect, Kyuma stated: "They have been doing
things like in the East-West Cold War days. In a sense, that's like
a habit. It's wrong to say 'anti-SDF' (in classifying subjects), so
I've told officials to study how to classify."
17) Boeing to ink tie-up agreement with Mitsubishi Heavy Industries
to help promote Japan's first passenger jet
NIIKKEI (Page 1) (Excerpts)
June 20, 2007
Takuji Kokushida, Paris
Mitsubishi Heavy Industries inked a partnership agreement with the
Boeing Company of the United States to promote Japan's first
passenger jet. Mitsubishi aims to commercialize the jet in 2012.
Boeing is expected to cooperate in marketing and maintenance. To
initiate the project worth 300-400 billion yen, it is necessary to
secure enough orders from foreign airlines first. By winning
cooperation from Boeing, Japan's first passenger jet business has
taken a step forward.
Mitsubishi Heavy Industries Chairman Takashi Nishioka and Scott
Carson, Chief Executive Officer (CEO) of Boeing's commercial
airplane unit, signed the agreement during the International Paris
Air Show. In an interview with the Nikkei, Carson said: "Both sides
will establish a working-level panel and quickly work out details."
Mitsubishi plans to commercialize a 70-90 seat small jet. Since
Boeing manufactures larger aircraft with at least 100 seats, the
American company has judged that "there is leeway for the company to
extend cooperation because they play on different markets,"
according to Carson. Boeing has no intention of investing in the
Mitsubishi project for now. The companies will focus on business
cooperation in such areas as marketing.
The development cost is estimated at 120 billion yen, of which about
40 billion yen will be subsidized by the Ministry of Economy, Trade
and Industry. The remaining 80 billion yen will be shouldered by a
company to be established by Mitsubishi Heavy Industries, trading
companies, and banks. Mitsubishi will launch a global marketing
TOKYO 00002772 010.2 OF 011
campaign this fall. Looking at the order situation by next spring,
the company will determine the feasibility of the project.
18) "Boneless" big-boned economic guidelines with focus on upcoming
Upper House election adopted: Covers wide range of items but puts on
hold spending cuts
TOKYO SHIMBUN (Page 3) (Excerpts)
June 20, 2007
The Abe cabinet adopted its first Basic Policy Guidelines on
Economic and Fiscal Management. A major feature of the economic
guidelines is that they contain a wide range of items, such as a
growth strategy, administrative and fiscal reforms, the environment
and education. Probably with the upcoming Upper House election in
mind, the government has given consideration to local districts. It
has also put off many reform items that are painful to voters,
including the consumption tax and spending reform. The economic
policy thus turned out to be "boneless" without a solid approach to
structural reforms.
Showcase
State Minister for Economic and Fiscal Policy Hiroko Ota has
characterized a Growth Power Boosting Program included in Chapter 2
as a feature of the economic guidelines adopted this time.
The program set a target of raising the growth rate of labor
productivity by 50 % ., to 2.4 % ., from 1.6 % ., , the average
rate of the past 10 years, over the next five years. To achieve that
end, it proposed raising growth potential to boost the nation's
basic economic potential through assistance to job seekers and more
efficient services using information technology (IT).
However, most proposals have already been promoted by government
agencies. For instance, a proposal for raising the minimum wage, a
measure to correct income disparities proposed with the Upper House
election in mind, lacks any specific measures. The report has no
description of effects resulting from the realization of such a
policy.
Consumption tax hike put off
One senior member of the Liberal Democratic Party (LDP) Land and
Transport Department during a meeting of the party's Policy Research
Council on June 5 said with a look of satisfaction, "A 3 % ., cut
in public works was not included in the guidelines thanks to the
Policy Research Council chairman."
The economic guidelines issued last year incorporated a 1 % ., -3 %
., cut in public works over the next five years starting fiscal
2007. Following this proposal, a 3.5 % ., cut was realized in the
fiscal 2007 budget.
Private-sector members of the Council on Economic and Fiscal Policy
(CEFP) proposed a 3 % ., cut over the next five years starting in
fiscal 2008, as well. They called for incorporating a 3 % ., cut
at a CEFP meeting on May 8, pointing out that improper profits made
through bid-rigging account for about 20 % ., .
Land, Infrastructure and Transport Minister Tetsuzo Fuyushiba
rebutted, "Something really bad would happen if more public works
TOKYO 00002772 011.2 OF 011
were cut." The discussion thus ended without agreement.
One senior Cabinet Office official revealed, "We met fiercer
resistance to a proposal for cutting expenditures than we had
expected due to the upcoming election." In the end, a 3 % ., cut
in public works was not included in the report. Prime Minister Abe
during a CEFP meeting held late last month simply read out a paper
containing an abstract policy: "There is no change at all in our
policy of eliminating fiscal waste."
Proposals that will lead to an increase in the public burden have
also been put on the back burner. Regarding social-security-related
expenditures, such as medical and nursing-case expenses, last year's
economic guidelines adopted a 1.1 trillion yen cut in national
expenditures. Ota tried to draw up a reform road map based on that
policy. However, the plan was aborted due to opposition from the
Ministry of Health, Labor and Welfare. As a result, the report
simply mentioned that a way to achieve the economic guideline for
fiscal 2006 within fiscal 2007 will be indicated.
Medical treatment fees are to be revised at the end of this year, a
practice that takes place every two years. However, in the
guidelines, the Abe administration did not touch on this issue,
giving consideration to the Japan Medical Association, a large bloc
of votes for the LDP. A hike in the consumption tax has been put off
until after the Upper House election, with the report noting that
full-fledged discussion on reform of the tax system will be pursued
from this fall.
SCHIEFFER