Noda plans to enact fresh stimulus package before general election

Kyodo

Prime Minister Yoshihiko Noda instructed his ministers Friday to compile a fresh fiscal stimulus by month’s end to kick-start the stagnant economy ahead of December’s general election.

Noda told a Cabinet meeting that he wants all ministers to consider further growth measures to be funded via an extra budget in fiscal 2012, apparently based on the assumption that his Democratic Party of Japan will remain in power after the Lower House polls.

Government offices are required to submit such policy measures by Nov. 30, when the Cabinet plans to approve the stimulus package, the second in two months following measures passed in October worth some ¥422 billion.

The size of the new package is unknown, but the government is likely to use some of the reserve funds for the current fiscal year, which total around ¥940 billion at present. It is rare for a government to tap its contingency funds prior to an election.

“We should not leave any negative effect on the economy from the current political climate,” Finance Minister Koriki Jojima said.

However, Noda’s move will probably be labelled by the opposition camp as just a desperate last-minute effort to drum up support among voters through pork-barrel spending.