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Monday, Jan. 19, 2009

Bureaucratic reform on the line

Rebels like Watanabe feel now is the time to break the system


Staff writer

Former administrative reform minister Yoshimi Watanabe's resignation from the Liberal Democratic Party highlights a growing rebellion against Prime Minister Aso Taro, who has been struggling to steer the nation amid sagging public support.

But the move also casts light on Watanabe's pet policy: Drastic reform of the bureaucracy, which has effectively crafted national policy since the Meiji Era (1868-1912).

Aso's lack of passion about carrying out bureaucratic reform is the main reason Watanabe says he resigned from the ruling party.

"It's not just that Aso's Cabinet has no passion for the reform. It is going backward," Watanabe told The Japan Times last month.

Bureaucracy-oriented policymaking may have worked well when Japan was experiencing rapid economic growth, with bureaucrats working toward the common goal of catching up with the West.

The system, however, gradually fell into dysfunction when Japan achieved that goal and the interest of the bureaucrats turned to protecting their ministries rather than their nation, experts say.

Kenji Eda, an independent Lower House member and former bureaucrat in the old Ministry of International Trade and Industry, says this "extremely strong sense of 'belongingness' " to their ministries needs to be addressed.

"If they continue to be loyal to their ministries, they get lifetime support in return, including 'amakudari,' " said Eda, who promoted streamlining the ministries under Prime Minister Ryutaro Hashimoto.

Amakudari is the practice of giving top bureaucrats lucrative jobs in government-affiliated organizations and private companies when they retire.

As of April 2006, about 28,000 former bureaucrats were working at about 4,500 organizations through amakudari, according to a survey compiled by the Lower House research bureau. Between August 2007 to August 2008, about 590 bureaucrats received such jobs.

"Amakudari is the cause of all the waste of the taxpayers' money. The structure in which bureaucrats establish wasteful organizations and keep wasteful subsidies should be broken up," said Eda, who with some other former bureaucrats created a group to discuss problems with the current bureaucracy.

Watanabe agrees, saying the practice of "watari" should also be stopped immediately. Watari is when ministries arrange successive jobs for retired bureaucrats at government-affiliated corporations, with the former civil servants getting retirement money each time.

On Friday, Watanabe and Eda formed a political campaign group with two other analysts — a move observers say could trigger a political realignment if they are joined by more LDP lawmakers.

As part of administrative reform, the government set up an organization Dec. 31 that will arrange jobs for all retired bureaucrats, instead of having each ministry do so. The practice of watari was also banned.

During a three-year transition period, however, each ministry can still arrange jobs for its officials who are set to retire without going through the new organization, on condition approval is granted by the Cabinet Office's monitoring committee.

But because the opposition camp, led by the Democratic Party of Japan, disapproved of the nominee to head the panel, which needs the OK from both chambers of the Diet, the committee has been effectively in limbo.

To fill the vacuum, the government decided in December that the prime minister will have temporary power to approve amakudari and watari arrangements.

The move drew strong criticism from Watanabe, the DPJ and even from Aso's LDP.

Restricting amakudari is not the only problem that needs to be solved. Experts point to the need to change bureaucrats' clubbiness.

And if promotions and job security are the main interests bureaucrats have in mind, the best solution may be to create a separate personnel bureau outside their ministries, according to some experts.

This is why the Diet cleared a bill last June to create a personnel bureau under the Cabinet Secretariat that would have the power to appoint senior ministerial officials, including vice ministers.

At present, each ministry makes such decisions. Although the decisions must be approved by the ministers — who are political appointees — they traditionally just rubber-stamp the bureaucrats' proposals, experts say.

Shifting this to the Cabinet Secretariat "is a bold plan to break up the clanlike personnel affairs at each ministry ," said LDP defector Watanabe.

Unsurprisingly, the ministries are strongly against it.

In November, when the group held a hearing with the ministries, most said the power should remain with them.

For instance, the Finance Ministry currently manages payroll affairs for civil servants. The ministry said this jurisdiction should not be transferred because it is more efficient if financial matters are unified under the finance minister.

Because of their strong protests, the government pushed back the deadline for establishing the personnel bureau in the Cabinet Secretariat from the end of March 2010 to April 2010.

While experts welcome creation of the personnel bureau, some doubt it will ever function properly.

Akira Morita, director of Todai Policy Alternative Research Institute, points out that politicians may start developing cozy relationships with bureaucrats who are in line for appointments to senior posts.

"In that case, it would be questionable if the bureaucrats could really be loyal to the whole community," said Morita, who maintains that discussions about this issue have been far from sufficient in the ongoing reform.

But Eda of the Lower House claims the key to pushing the reform forward is a reform-minded leader at the top.

"To achieve genuine civil servant reform, Mr. Aso needs to be replaced. Better yet, the politics of the LDP needs to change. The LDP has had this relationship with the bureaucracy since the end of the war. This tie has to be cut through a change in government control," he said.



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The Japan Times

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