Takaichi Set to Announce Launch of Social Security Reform Panel

The Yomiuri Shimbun

14:52 JST, October 23, 2025

Prime Minister Sanae Takaichi plans to announce the launch of a social security reform panel during an upcoming policy speech that will outline the basic policies of her newly formed administration, The Yomiuri Shimbun has learned.

The panel, which will be comprised of experts and members of ruling and opposition parties, will examine and review the system of social security benefits and contributions.

Takaichi’s Cabinet began working Wednesday, a day after the ministers were appointed. “I will make firm, well-considered decisions and keep moving forward,” Takaichi said to reporters at the Prime Minister’s Office that day. “I’ll work diligently and even faster.”

According to a draft of the speech, Takaichi will also underline her determination to bolster the nation’s defense capabilities. The government plans to increase security-related expenditures to an amount equivalent to 2% of the gross domestic product by fiscal 2027. Takaichi plans to announce a proposal to bring forward the date for achieving this increase to fiscal 2025. The prime minister intends to top up security-related expenditures in the fiscal 2025 supplementary draft budget, which is scheduled to be passed during the current extraordinary Diet session.

Given Japan’s declining and aging population and chronically low birthrate, Takaichi has recognized that a national debate on the state of social security is essential and intends to announce plans to establish a panel tasked with examining this issue. Takaichi pledged during the LDP’s presidential election to establish such a panel.

In a move intended to support low- and middle-income earners struggling to pay taxes and social security premiums, Takaichi also plans to announce the early implementation of a “refundable tax credit” system that combines tax reductions with benefit payments.

The recently inked coalition agreement between the LDP and the Japan Innovation Party also mentioned social security reform. The prime minister is poised to call on parties across the political spectrum to cooperate in efforts to reduce the financial burden being shouldered by the working generation.

The speech draft included a call to promote “responsible expansionary fiscal policy” – a pet policy of the prime minister — and to consider restrictions on land acquisitions by foreigners. In a nod to the JIP’s signature “second capital” initiative, in which a “back-up” city would assume the functions of a capital in the event of a disaster affecting Tokyo, Takaichi’s speech is likely to call for accelerating consideration of such a policy.

The prime minister will position the economy’s precedence over fiscal policy as a basic government policy. Takaichi will advocate the use of strategic fiscal spending to increase national income, and seek to realize a virtuous economic cycle in which improved consumer sentiment leads to higher tax revenue. She will also likely announce the establishment of a “Japan growth strategy council” that will discuss specific measures for medium- and long-term economic growth.

Regarding policies relating to non-Japanese residents, Takaichi will acknowledge that many companies currently must rely on foreign laborers due to a worker shortage, but she will set out an approach of dealing strictly with cases of illegal activity and rule-breaking. To achieve this, Takaichi is set to cite “strengthening the government’s ‘control tower’ functions” and consider what the rules for acquiring land should be.