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Friday, Sep. 23, 2011
Dubious devolution policy
Pushing devolution has been one of the main policies of the Democratic Party of Japan, which grabbed power from the Liberal Democratic Party in September 2009. As part of the policy, a law was enacted and went into force to give legal footing to a forum in which the central government and local government leaders discuss important policy matters.
But it is unclear whether Prime Minister Yoshihiko Noda is serious about devolving more power and money to local governments from the central government.
He may be more concerned with attaining a friendly relationship with bureaucrats of the central government ministries and agencies in order to raise taxes — his main policy goal. He devoted only one short sentence to the theme of devolution in his policy speech: "Following the preceding administrations, I will push devolution-related reform."
The March 11 earthquake and tsunami have reminded us that local governments are directly responsible for social welfare services for local residents, such as medical and nursing care services.
To strengthen services directly related to local residents, it is important for the central government to beef up financial support for local governments.
In his policy speech, Mr. Noda mentioned grants with no strings attached to local governments in the disaster-hit areas. It is clear that the areas devastated by the tsunami will need a large amount of money for reconstruction, including funds to move communities to elevated areas.
Local governments and residents are having meetings about their reconstruction plans.
Mr. Noda should give large-sum grants with no strings attached to local governments concerned so that their reconstruction efforts will go smoothly.
In the fiscal 2011 budget, the DPJ government provided ¥500 billion grants with no strings attached to the nation's prefectural governments.
In the fiscal 2012 budget, it plans to provide another ¥500 billion in a similar way to the nation's municipal governments. Mr. Noda should give grants with no strings attached for reconstruction purposes — outside the ¥500 billion grants.
Mr. Noda plans to push tax and social welfare reforms, which will include a consumption tax raise.
The Noda administration should heed local governments' call for increasing their share of revenues collected from the consumption tax.