The Diet on Wednesday approved the ¥92 trillion budget for fiscal 2013 to support the immediate issuance of debt-covering government bonds.
The Upper House rejected the budget bill earlier in the day as lawmakers voted along party lines. The ruling coalition lacks a clear majority in the chamber.
With the Upper House rejection, a joint committee of both chambers met and failed to reach an agreement. Thus, as stipulated in the Constitution, the Lower House decision became final.
The 2013 budget's enactment comes more than one month after the beginning of the current fiscal year because the Lower House election in December delayed the entire process of drafting the bill.
The approval of the budget allows the government to automatically issue government bonds worth ¥42.9 trillion. Legislation passed last year allows the government to issue bonds between fiscal 2013 and fiscal 2015 as long as the budget has been approved.
With the current Diet session scheduled to end on June 26, both the ruling and the opposition camps are at loggerheads over a bill to cut five single-seat constituencies from the current 300 in the Lower House in an attempt to rectify the vote-value disparity.
A series of high court rulings said the existing state of vote disparity is either unconstitutional or invalid.
The opposition camp in the upper chamber has vowed to reject the bill because it calls for drastic electoral reform, but the bill is likely to be passed as the ruling bloc will be able to use its overriding power in the Lower House.
If the Upper House fails to put the bill to a vote within 60 days after it is sent to the chamber, it is automatically rejected.
To avoid a showdown, the ruling and opposition blocs met earlier Wednesday to find some middle ground, but didn't.