Japan's lower house approves 30 bln USD extra budget for FY 2015

Japan's lower house of parliament on Thursday approved a draft extra budget of 3.50 trillion yen (29.6 billion U.S. dollars) for fiscal 2015 through March.

The extra budget passed the lower house with the majority support from the ruling Liberal Democratic Party and its Komeito junior ally to underpin the economy and make necessary welfare provisions, help farmers and ensure enough financing is available for disaster and relief efforts.

The supplementary budget was initially approved by the Cabinet of Prime Minister Shinzo Abe on Dec. 18 last year and has been drafted to realize some of Abe's own economic-based policies.

Some of these are aimed at tackling the nation's demographic crisis, safeguarding farmers' interests once the 12-nation Trans-Pacific Partnership free trade agreement takes effect, which will see tariffs eliminated or largely reduced on agricultural imports, and creating a society where the majority of citizens are economically engaged.

Other policies covered by the budget include introducing enhanced mechanisms to encourage more couples to have children and support the raising of children while encouraging mothers to return to work, as well as encouraging staff to continue working in nursing care-related jobs, an essential sector that will further have to deal with the care of Japan's rapidly aging society.

The supplementary budget, officials said, will actually total some 3.32 trillion yen, as interest payments are almost certainly likely to be lower than previously anticipated, due to lower interest rates that decreases debt-servicing costs.

The government plans to significantly reduce the primary balance deficit, which refers to the amount by which the government's total expenditure exceeds its total revenue, excluding interest payments on its debt, as the nation's public debt continues to swell and currently stands at the highest in the industrialized world at more than double the size of its economy.

Japanese farmers will be supported by an allocation of some 300 billion yen to counteract potential losses associated with the upcoming deregulation of the sensitive industry, following the recent inking of the TPP deal, while lump-sum payments of around 30,000 yen will be issued to low-income senior citizens.

Finances have also being earmarked for counterterrorism measures, following the government's recent launch of its own multi-faceted, intergovernmental counterterrorism unit, as Japan will be hosting a number of high profile international events over the next four years, including the G7 summit next year and the Olympic Games in 2020.

In addition, around 500 billion yen will be allocated for disaster and relief measures, while 800 billion yen will go to efforts to speed up reconstruction efforts still ongoing almost five years after a massive earthquake-triggered tsunami pummeled Japan's eastern seaboard.

The government said it will not issue any more debt to finance the budget and is relying on tax from the fiscal year, following solid earnings from corporations and leftover funds from the previous budget.

The main opposition Democratic Party of Japan however criticized the extra budget for mainly benefiting the elderly who already have sizable incomes, while not making enough provisions for low income earners and the young.

The ruling coalition, nevertheless, is hoping to have the extra budget approved by the upper house next Wednesday, at the earliest, following deliberations that will start in the upper caucus Friday. Endit