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Fifth in a series

Staff writer

The Japanese Communist Party will focus its campaign for the July 12 Upper House elections on a pledge to roll the consumption tax rate back to 3 percent to boost consumer spending, said Kazuo Shii, chief of the JCP’s central committee secretariat.

“The first thing that should be done is to cut the consumption tax rate. It is indispensable not only to protect the daily life of the general public but also to revive the nation’s ailing economy,” Shii said in an interview.

The 2 percentage point increase in the consumption tax from 3 percent to 5 percent in April 1997 has severely affected household spending, which accounts for about 60 percent of the nation’s gross domestic product, resulting in a lingering economic slump, he said.

The Economic Planning Agency announced earlier this month that Japan’s economy shrank by an annualized 5.3 percent during the January-March quarter, leading to the nation’s first annual economic contraction in 23 years.

Shii, 43, also said the nation’s social security system should be greatly improved to enable people to feel secure about their future and loosen their purse strings. “The poor social security system has prompted the public to save money. If we don’t provide better social security services, 1.2 quadrillion yen in personal savings and assets will not be tapped,” he said.

When asked whether reinforcing social security will lead to the creation of a larger government and reverse ongoing administrative reform, Shii said Japan has allocated the smallest percentage of its national budget for social security spending among industrialized nations. Japan puts 15 percent of the budget toward such spending, about half the figure in most European nations.

Shii severely criticized the government’s latest 16 trillion yen package of economic pump-priming measures, saying that most of the additional budgetary allocations will be spent to build more highways, bridges and ports.

“The public works projects should be replaced by plans to build welfare facilities such as nursing homes and medical institutions for the aged. That would also lead to reforming the current troubled economic structure.”

Shii and his colleagues feel that public expectations for the JCP have risen to an unprecedented height. “We have a record number of participants at every party gathering across the nation these days. Many are former supporters of other political parties including conservative parties,” he said.

The JCP has considerably broadened its appeal to a growing number of unaffiliated voters, attracting many who are frustrated with the current political situation, according to political experts.

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