The government will take legislative steps in the upcoming Diet session, expected to convene this fall, to help revitalize small and medium-size enterprises and nurture venture businesses, Prime Minister Keizo Obuchi said Wednesday.

Obuchi made the remarks during the sixth meeting of the Competitiveness Commission, his advisory organ set up to map out steps to keep Japan's economy competitive. The commission consists of Cabinet ministers and representatives from the business community.

Obuchi said the government panel will now concentrate its discussions on the future of the economy, in particular promotion of small firms and venture businesses.

"An extraordinary session of the Diet may be convened in the fall, so the government will now make swift efforts to sort out (necessary) legislative and other measures," International Trade and Industry Minister Kaoru Yosano quoted Obuchi as telling the gathering.

The government has been preparing to make legal and tax changes with the aim of making it easier for small enterprises and venture firms to do business with preferential taxation.

Steps under consideration include taxes aimed at promoting individual investments in venture businesses and measures designed to speed up bankruptcy proceedings to make it easier for troubled firms to rebuild.

Yosano said his ministry and the Finance Ministry are preparing to hammer out specific measures to help small and venture businesses, noting Finance Minister Kiichi Miyazawa has pledged cooperation.

Miyazawa later told reporters that his ministry is ready to support small and midsize companies with fiscal spending or tax revisions, although he added he did not have specific ideas yet. He indicated that those measures will be included in a supplementary budget if necessary.

Obuchi meanwhile pledged to secure an exceptional sum in the fiscal 2000 budget for "millennium projects" and other measures expected to contribute to industrial resuscitation, according to the trade chief.

Yosano said the prime minister will take the initiative in sorting out priority areas for budget allocations.

The government is expected to focus on millennium projects in three areas -- information technology, medical and social measures for Japan's aging society, and environment-related businesses.

Yosano also said the government will proceed with deregulation in order for the private sector to participate in the millennium projects.

Promotion of technology transfers from academia to industry, as has been undertaken by technological licensing organizations, is also a key to facilitate the projects, he said.

While urging industries to make use of the recently enacted special legislation designed to enhance Japan's industrial competitiveness, Obuchi said the commission will now shift its focus from liquidation of industrial debts accumulated during the bubble economy to promotion of small and venture businesses and their technological development.

During Wednesday's meeting, the commission touched on issues concerning revitalization of the service and distribution industries, based on proposals put forward by Toshifumi Suzuki, president of Ito-Yokado Co., Masayoshi Son, president of SoftBank Corp., Soichiro Fukutake of Benesse Corp and Jiro Ushio of Ushio Inc.

Both business leaders and Cabinet ministers agreed on the need to facilitate labor turnover from the manufacturing sector to the service industry, with a mutual recognition that the situation in Japan is more than a decade behind that of the U.S.

Specifically, Ushio asked Labor Minister Akira Amari to urge industries to ease the age limit in job offers to give middle-aged jobless people a second chance at getting jobs through temporary personnel services for an indefinite period.

While the business representatives asked the government to take more deregulatory and corrective measures to promote entry of the private sector into service areas such as nursing, as well as their competitiveness vis-a-vis quasi-public agencies, Chief Cabinet Secretary Hiromu Nonaka said consumer cooperatives, for example, may be far better-treated compared with other distributors.