In line with Prime Minister Junichiro Koizumi's fiscal reform policies, Finance Minister Masajuro Shiokawa has acknowledged the need to make substantial cuts to general expenditures for fiscal 2002.
The reductions are necessary if the government is to meet Koizumi's pledge to restrict new issuance of government bonds to no more than 30 trillion yen, the new finance chief said in an interview.
"Although this idea is not concrete yet, we can tighten general expenditures by 2 trillion yen and local tax grants by 1 trillion yen (for fiscal 2002)," Shiokawa said. "This might cause pain, but it's time to distance ourselves from depending on government bonds as a convenient source of funds."