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Monday, Nov. 19, 2012

EDITORIAL

Scrutinize reconstruction funds

The Board of Audit on Nov. 2 announced that it found 513 cases of wasteful use of public money by government organizations in the settlement of accounts for fiscal 2011, with the value of such wasteful use totaling some ¥529.6 billion — the second highest on record. Because the board was not able to study all the items, it can be assumed that a larger amount of public money has been improperly used.

The government plans to raise the consumption tax rate from the current 5 percent to 8 percent from April 2014, increasing people's financial burden. Unless the government carefully examines the current way of asking for and using budget money by government organizations, and makes serious efforts to reduce wasteful spending, people will not accept the planned consumption tax raise. The government also should be aware of the possibility that the tax hike will break the recovery of the Japanese economy, which has been suffering from a long period of deflation.

The biggest irregularity in terms of money value is the Urban Renaissance Agency's failure to sell some 223 hectares of unused land whose book value is ¥89.7 billion. The National Hospital Organization was found to have failed to effectively utilize some 217,000 sq. meters of land whose book value is some ¥6.7 billion. It was also found that while facilities related to the inoperative fast-breeder reactor Monju in Tsuruga, Fukui Prefecture, cost some ¥83 billion, they are not used at all. This shows how Japan's nuclear power policy follows an unchanging path of bureaucratic inertia.

The board examined the use of the budget for the reconstruction from the 3/11 disasters in 58 municipalities in seven prefectures and found that the speed of the reconstruction differs greatly from municipality to municipality. On average, 48.8 percent of the budget money distributed to the municipalities was actually used.

In eight municipalities including Higashi Matsushima, Miyagi Prefecture, the budget execution rate was 80 percent or more while in six municipalities including Futaba, Fukushima Prefecture, the rate was less than 20 percent.

The low rate is attributed to shortages of municipal workers and the long period of time needed to form consensus among local residents on disposal of debris and to secure land needed for reconstruction projects. The government must study ways to help these municipalities.

Unfortunately, the board did not mention problematic use of the reconstruction budget, such as a project to counter the moves of an antiwhaling group and projects to help enterprises outside the disaster areas with capital investment.

The Finance Ministry believes that of some ¥4.5 trillion demanded by ministries and agencies for reconstruction during fiscal 2013, about one-fourth has nothing to do with reconstruction. It is imperative that the government strengthen internal mechanisms to closely check budget demands and execution.



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