The government said Friday it will cut spending for its five-year defense program by 92 billion yen to conform to its ongoing financial structural reform, the Defense Agency said.

The decision, which sets the budget at 24.23 trillion yen, was reached at Friday's meeting of the Security Council of Japan and a following Cabinet meeting, the agency said. "Considering the present financial and economic circumstances, (the government) decided to cut 10 percent, or 92 billion yen, off the remaining contract in the program," said Defense Agency chief Fumio Kyuma.

Initially, the 1996-2000 defense program was to be reviewed in fiscal 1998, instead of this year. The buildup, approved in 1995 under a new National Defense Program Outline, had called for a total budget of 25.15 trillion yen, up 13 percent from the 1991-95 budget.

The government's decision reduces the average annual expenditure to 0.9 percent from the 2.1 percent initially planned. Over the next three years, there will be no increase in defense outlays under the revised program, the agency said.

Of the revised budget, frontline equipment accounts for 4.07 trillion yen, down by 195 billion yen from the original plan. Expenditures for rear-echelon support amounts to 9.77 trillion yen, also down by nearly 740 billion yen. The remaining 10.39 trillion yen, up 14 billion yen from the initial program, is allocated for personnel expenses and provisions.

The original budget called for procurements that include 96 type-90 tanks, eight destroyers and 47 F-2 next-generation support fighters. But the revision has forced the agency to reduce the tanks by six, destroyers by one and jet fighters by two.

Military exercises will also be curtailed to save expenditures, they said. Japan began host-nation support of the U.S. forces in 1978 with an annual disbursement of 6.2 billion yen. Friday's decision marks the first time since then that the government will reduce spending in this area. "The overall curtailment has no sanctuary (even for the U.S. forces)," Kyuma said, adding that further reductions will only be made in line with bilateral treaties such as the Status of Forces Agreement and by negotiating with Washington.