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Monday, July 5, 2010
Funding social welfare
Social welfare such as pensions, medical and nursing care as well as support measures for families rearing children is an important issue. A fiscal 2009 Cabinet Office survey shows that the largest portion of those polled — 69 percent — want the government's priority to be on establishing a pension system that is equitable and reliable.
Japan's political parties have proposed various social welfare measures that voters will take into consideration in deciding which party to support in the July 11 Upper House election.
The Democratic Party of Japan, which proposed giving a monthly child allowance of ¥26,000 from fiscal 2011 in its manifesto for the 2009 Lower House election, now says local governments can use funds meant to raise the current ¥13,000 monthly allowance for public services like nursery schools.
Meanwhile, the No. 1 opposition Liberal Democratic Party calls for a complete review of the child-allowance program and proposes making nursery schools, kindergartens, school lunches and children's medical services free of charge.
As for pensions, the DPJ proposes unifying various pension schemes to establish a system that guarantees at least ¥70,000 a month. The system would be funded with revenues generated by the consumption tax. Both the LDP and Komeito propose allowing people to become eligible to receive a basic pension if they pay premiums for at least 10 years, instead of for 25 years as required at present. The actual amount of the basic pension would depend on premiums paid into the system.
The Japan Communist Party proposes starting a ¥50,000 monthly pension soon with government funding. An additional amount would be based on premiums paid.
Pension payment totals have been on the rise. Health and welfare ministry data show that, in fiscal 2008, some 36 million people received a total of ¥49 trillion. Yet, the average pension amount has been in decline, meaning that an increasing number of elderly people are having to make do with a smaller pension.
Some social welfare-related proposals may seem too sweet for voters. The problem is that the parties are not giving detailed explanation about the funds needed. They must make clear how much people will have to pay to receive promised benefits.