Finance Minister Masajuro Shiokawa said Tuesday the government will review long-term public works programs whose value are questionable due to lengthy completion times.
“I want ministries to actively review the public works projects whose efficacy has been lost due to the passage of too much time,” Shiokawa told the Upper House Budget Committee.
Shiokawa referred to 16 projects with planned construction periods of five to seven years.
“The issues associated with the shares of budgets to be allocated to government ministries and the ceiling (to be placed on the size of the ministries’ budget requests) should be thoroughly reviewed,” Shiokawa said.
“Unless flexibility is applied when determining these points, the government will not be able to appropriate funds to the programs where they are necessary or shave budgets for programs that should be trimmed,” he said.
Meanwhile, Chikage Ogi, minister of land, infrastructure and transport, said she has instructed her ministry to come up with guidelines to review by the end of May the use of funds from special revenues appropriated for building roads.
Her remarks came a day after Prime Minister Junichiro Koizumi told the same Diet panel that his administration will reach a basic conclusion before the July Upper House elections on whether to extend the use of such funds to other projects.
The funds amount to 5.8 trillion yen for fiscal 2001, which began in April. Road construction forms a major component of annual public works projects.
Heizo Takenaka, state minister for economic and fiscal policy, indicated the Council on Economic and Fiscal Policy will recommend cutting local government tax grants and public works spending in its policy outlines.
The government will discuss social infrastructure, social security, and the relationship between the central and local governments, he said.
The panel plans to present its policy outline by late June.
LDP executives wait
The ruling Liberal Democratic Party on Tuesday put off a decision by its Executive Council on whether to endorse Prime Minister Junichiro Koizumi’s proposal to expand the use of special road-building revenues.
Koizumi pledged Monday to review the use of the revenues prior to the Upper House elections in July.
At Tuesday’s meeting, some LDP lawmakers, including Muneo Suzuki, Toshikatsu Matsuoka and Kozo Kishimoto, said they opposed the proposal, claiming that earmarked taxes like the one for road construction should be used for their original purposes.
Party policy chief Taro Aso said the issue was left for the next Executive Council meeting Friday.
The special road revenue comes mainly from gasoline and vehicle weight taxes. It has been instrumental in improving the nation’s roads and highway networks since World War II.
However, critics say that for many years it has been used by LDP elements for pork-barrel politics.
The revenue for road construction is estimated at 5.8 trillion yen under the budget for the current fiscal year that began in April.
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