The government approved a bill Friday that gives the timeline for administrative reforms planned for the next several years, positioned as the capstone to Prime Minister Junichiro Koizumi’s reform agenda.
The bill, which covers changes ranging from reorganizing government-backed financial institutions to selling off state-owned assets such as civil-servant housing, is expected to be the focus of the Diet for the rest of the regular session, which ends in June.
The legislation was written under Koizumi’s “small government” policy, aiming to downsize the debt-ridden government as well as boost administrative efficiency to adjust to the shrinking population.
Koizumi, who says he will not run again for the Liberal Democratic Party presidency once his current term ends in September, appears to be looking at proposed legislation as a way to lock his successor into his reform program, which has included austere budgets and streamlining the state bureaucracy.
During Friday’s Cabinet meeting, Koizumi told his ministers they needed to get the bill passed.
“The bill is the most important one of the ongoing Diet session,” he said. “I want all of you to do your best to have the bills passed as soon as possible and carry out the reforms proposed in the bill.”
Such talk sets the stage for the Diet to become a battleground among contenders for Koizumi’s job. LDP presidential hopefuls will try to demonstrate they are reformers in the mold of Koizumi. The bill sets five policy targets — the consolidation of state-backed financial institutions, a review of independent administrative agencies, the restructuring of 31 special accounts in the budget, a 5 percent cut in the civil service and trimming state assets.
State-backed financial institutions and special accounts are both long overdue for reform. The financial entities have been criticized for taking on retired top bureaucrats as executives and giving them high salaries, while the special accounts have not been reassessed for a long time.
The government is also battling a huge fiscal debt as well as a mountain of red tape that reformers say should be cut.
Some observers say these new reforms probably will face strong opposition from bureaucrats and other groups affected by the changes.