A House of Representatives panel considering whether to relocate the core functions of the central government outside of Tokyo on Wednesday gave up trying to select a candidate site before the current Diet session adjourns next month.

Although the panel has stated that efforts to resolve the matter should continue, Wednesday’s decision is widely perceived as the effective shelving of the 12-year-old project.

Plans to move the capital’s core functions out of Tokyo were inspired by the late 1980s asset-inflated bubble, which led to skyrocketing land prices in the capital.

Momentum for the grand project has subsided in recent years, however, as the nation’s economic problems have mounted.

In a report submitted to Lower House Speaker Tamisuke Watanuki, the committee proposed creating a joint consultative panel with the House of Councilors to discuss a watered-down idea to relocate the branches to a number of cities.

As the Diet adjourns in three weeks, however, it appears almost certain that the relocation issue will be carried over to the next regular session. Many in the ruling coalition have said they believe it will be difficult even to set up the proposed joint consultative panel before the current session ends on June 18.

The issue of relocating the capital has been on the political agenda since 1990, when land prices were sky-high due to Japan’s real estate bubble.

In 1999, an advisory body to the prime minister’s advisory panel recommended three candidate sites — Tochigi-Fukushima, Gifu-Aichi and Mie-Central Kinki — where the legislative, administrative and judicial branches traditionally centered in Tokyo could be relocated.

The Lower House capital relocation panel said it favors the idea of relocation, but the report says the committee has been unable to agree on a single candidate site.

The report says the Diet should consider the “novel idea” of spreading the government branches out to several different locations.

The Lower House committee was supposed to name a single candidate site last May. But the conflicting interests of lawmakers represented on the committee deadlocked deliberations.

The committee subsequently tried to reach an agreement by the end of the current Diet session.

“While we ought to have narrowed (the site) down to one, if we had done so, it would have triggered turmoil and made it impossible to put the decision to a plenary session vote in the chamber,” panel head Hiroshi Nakai told a news conference in explaining the committee’s failure to reach a conclusion.

The Tokyo Metropolitan Government has strongly opposed relocating any of the central government branches. The relocation proposal itself has gone through various changes in tandem with the decline in the nation’s economy.

Taichi Sakaiya, an economist who pushed the relocation idea when he served as head of the former Economic Planning Agency, said the government should no longer spend huge sums of public money to relocate the central government branches to a single location.

Some estimates have shown that the total cost could exceed 10 trillion yen.

Instead, he said, the administrative, legislative and judicial branches should be moved to three separate sites.