Has govt’s record-high budget been scrutinized for efficient spending?

Editorial

12:24 JST, December 25, 2021

The expansion of the national budget is unstoppable. Without scrutinizing budget items in terms of actual needs, and striving for efficient spending, people’s anxiety about the future will only increase.

The government has decided on its budget plan for fiscal 2022. The total amount of the general account will be ¥107.6 trillion, an increase of ¥1 trillion from the initial budget for fiscal 2021. This budget plan sets a new record high for the 10th consecutive year.

The main reason for the increase is that social security expenditures will rise by about ¥440 billion to ¥36.3 trillion compared to the initial budget for fiscal 2021. This is because the baby boomers are turning 75 or older, and the costs of medical and nursing care will balloon.

The natural increase of such costs due to the aging of the population was expected to be ¥660 billion in the budget request, but the government reduced this amount to ¥440 billion by lowering the government-set prices of drugs and increasing the portion of medical expenses to be paid by people aged 75 or older with incomes above a certain level. However, further budget increases are inevitable in the future.

To maintain the social security system, it is essential to discuss how to further improve efficiency and increase the amount paid by individuals.

Preparing for a fresh surge in novel coronavirus infections, a reserve fund of ¥5 trillion has been set aside, following the pattern of the initial fiscal 2021 budget, boosting the total amount.

The necessity of flexible COVID-19 responses has not changed. But it hardly can be said that the reserve fund for this fiscal year was used effectively. For example, the secured number of hospital beds failed to keep up with the rapid increase in the number of infected people this summer, and there were a number of cases in which people could not be hospitalized.

Since reserve funds can be spent without significant deliberation by the Diet, it is important to examine how the funds are actually used.

In his initiative for a “new form of capitalism,” Prime Minister Fumio Kishida has set forth a policy of bold investment for growth. In the budget plan, the government allocated a record ¥1.3788 trillion for science and technology promotion expenditures, focusing on promising fields such as digitization and decarbonization.

However, there is a lack of significant policy items in the budget plan. The Diet needs to deliberate to check to see if there are any unnecessary projects hidden in the budget plan labeled as funding for promising fields.

A record-high ¥36 trillion supplementary budget for fiscal 2021 was just established on Monday. The government is referring to the supplementary budget and the fiscal 2022 budget plan together as a “16-month budget” that will be seamlessly combined, and the total will be more than ¥140 trillion.

The supplementary budget includes such signature measures of the Kishida Cabinet as a ¥100,000 benefit for those aged 18 or younger and a project to attract semiconductor factories to Japan.

The Finance Ministry’s assessment of budget requests in a supplementary budget tends to be more lenient than for an initial budget that includes many continued spending items from the previous fiscal year. In some cases, ministries and agencies focus on realizing their requests in the supplementary budget, thus inflating the overall budget.

The outstanding amount of government debt is expected to surpass ¥1 quadrillion by the end of fiscal 2021, and it will only continue to increase. Proper ways of compiling budgets must be thought out.

— The original Japanese article appeared in The Yomiuri Shimbun on Dec. 25, 2021.