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It has been revealed that taxpayer money was wasted and excessive budgets were appropriated for measures against the novel coronavirus. The causes must be determined so the lessons can be applied to future budget execution.
The Board of Audit has released its audit report for fiscal 2021. Wasteful spending and improper funding processes totaled ¥45.5 billion, with costs linked to COVID-19 measures accounting for ¥10.2 billion.
In a government program to subsidize hospitals that set aside beds for COVID-19 patients, 32 hospitals, or 30% of those surveyed, received a total of ¥5.5 billion more than they should have.
The program is intended to compensate for the costs of keeping hospital beds available for COVID-19 patients, but the applications were made incorrectly, such as by claiming beds as “vacant” on the dates when COVID-19 patients were discharged from hospitals. In these cases, the hospitals made applications without understanding the requirements for receiving the subsidies, while the central and local governments failed to check the applications sufficiently. The hospitals reportedly intend to return the overpaid subsidies.
For COVID-19 measures, the application and screening procedures for subsidies were simplified. This must have been a necessary step to extend assistance promptly, but the system was complicated and difficult to understand, and the checking function also did not work. Such aspects require serious reflection.
When schools were closed due to the spread of infections, the government launched a program to rent out computer routers for educational purposes to households without internet access, but about 100,000 routers were not used at all. Not so many families apparently asked for routers when schools were closed. As a result, the subsidy of more than ¥900 million was not well utilized.
These cases are only the tip of the iceberg. Local governments should look into whether there are other similar cases.
From fiscal 2019 to 2021, the central government allocated a total of about ¥94 trillion to fund COVID-19 measures, of which about ¥18 trillion remained unused as of the end of fiscal 2021. Predicting the needs of each government program is difficult, but it is undeniable that the budgets were inflated as a focus was placed on the large scale of the measures.
Because such unspent budgets are returned to state coffers as unused funds or carried over to the following fiscal year, they will not necessarily go to waste. However, subsequent budgeting has ballooned further due to the presence of huge unspent funds, and this is highly problematic.
The government has approved a second supplementary budget plan for fiscal 2022 that includes funding for economic stimulus measures that require total expenditures of about ¥29 trillion.
As a result, the total amount of the fiscal 2022 general account, which includes the initial budget, has become closer to the figure for fiscal 2021, when the government was forced to spend huge amounts due to the pandemic. Fiscal management with a focus on large-scale measures has not changed.
The method of seeking additional expenditures through supplementary budgets, which are assessed more leniently by the Finance Ministry than initial budgets, has become the norm. Even though it is important to respond to rising prices, the government should not continue lavish spending that leaves large amounts of money lying around.
It is hoped that the Board of Audit’s findings will be taken as an opportunity to shift the government’s fiscal management back to normal.
