Govt Panel Releases Plan for Eliminating Preschool Wait Lists

The Yomiuri Shimbun

16:08 JST, December 15, 2020

Places for preschoolers will be expanded and some elderly will face bigger medical bills in proposals included in the final report by a government panel on social security for all generations that was completed Monday.

The report by the panel, chaired by Prime Minister Yoshihide Suga and which met at the Prime Minister’s office, includes a plan to arrange for accepting an additional 140,000 children in preschools by fiscal 2024.

The other noticeable proposal calls for raising the percentage of out-of-pocket medical expenses borne by people aged 75 and above in a single-person household with an annual income of ¥2 million or more from the current level of 10% to 20%.

The final report was to be adopted at a Cabinet meeting on Tuesday, after which the government will submit relevant bills to the ordinary Diet session next year.

“It is an urgent task for the young and the elderly to support each other and to curb the rising burden on the younger generation,” Suga emphasized at the panel meeting.

As a measure to counter the low birthrate, the report stated that the government will spell out a new plan for “stress-free child rearing” by the end of this year. From October 2022, the government will abolish the child allowance for households in which one family member has an annual income of ¥12 million or more, and redirect the savings for measures to eliminate the number of children on waiting lists for preschools.

Including contributions from companies, the government aims to eliminate the waiting period by securing places for about 140,000 more children by opening more preschools and other measures between fiscal 2021 and 2024.

The report also addresses support for fertility treatments, with the panel setting a timetable to begin the public health insurance coverage of the costs involved in April 2022. Until the insurance coverage starts, the current subsidy program for in vitro fertilization and micro-insemination will be greatly expanded. In addition to eliminating income limits for eligibility, the subsidy will be increased to ¥300,000 for each treatment, and coverage will be expanded to include couples in common law marriages.

In order to encourage men to take childcare leave, companies will now be required to inform employees who want to take such leave about its system regarding the matter, according to the report.

The increase in out-of-pocket medical expenses from 10% to 20% will be implemented in the second half of fiscal 2022. The first three years from implementation will be an adjustment period in which the increase in the amount paid for outpatient care will be capped at ¥3,000 per month. The increase affects about 3.7 million people, and the burden on the working-age population will be reduced by about ¥70 billion to ¥80 billion per year.

The charge that patients have to pay when they visit a large hospital without a letter of referral, which is added onto regular medical expenses, will be raised from the current ¥5,000 or more for the first visit to ¥7,000 or more.

Parts of the two interim reports, which the panel compiled in December last year and June this year, have already been enacted into law. In April 2021, companies will be obliged to make efforts to ensure employment opportunities through the age of 70. From October 2022, the scope of application of the employees’ pension to part-time workers will be expanded in stages.

While the final report marks the end of the panel’s work, some experts point out that the reforms do not go far enough to address the increasingly serious issues of a low birthrate and aging population.

“It is necessary to put our foot down harder on the accelerator in expanding those paying into the system,” said Prof. Takashi Oshio of Hitotsubashi University, an expert of public finance. “It might be necessary to raise the consumption tax rate in the future.”