The Diet on Friday enacted a 2.99 trillion yen supplementary budget for the current fiscal year that earmarks 1 trillion yen to ease the burden of structural reforms on workers and small firms.

The House of Councilors passed the extra budget during a plenary session Friday morning with the support of the tripartite ruling coalition. The extra budget was enacted after a week's deliberation. It was submitted on Nov. 9.

After its passage, Finance Minister Masajuro Shiokawa said the government has done its best to support the economy despite the current severe fiscal situation.

"I believe the extra budget has gained support in two points -- a focus on fiscal reform and job safety nets," Shiokawa said.

In terms of fiscal belt-tightening, the extra budget is funded by 1.682 trillion yen in bonds, bringing net issuance of bonds in fiscal 2001 to 30 trillion yen to meet Prime Minister Junichiro Koizumi's bond cap pledge.

Unlike previous extra budgets with mostly outlays for public works, the new package promises to weave safety nets for those pushed out of work and to help struggling small and midsize firms.

But the ruling coalition has already been pressing the government to compile a second extra budget to stimulate the flagging economy on grounds that the 2.99 trillion yen is too small to this end.

On this point, Koizumi told reporters after the passage of the extra budget that drafting another extra budget this fiscal year is not among his policy options.

Rather than resorting to pump-priming measures in a second package, the government plans to focus on the fiscal 2002 budget, which is to be finalized in December, Shiokawa said.

"If there is need for further measures, we would like to discuss the matter in the budget-making process for the next fiscal year," Shiokawa said.

"I believe, however, that it is important to ensure the smooth implementation of budget outlays we have prepared."

Of the 1 trillion yen set aside to help push through reforms, 550.1 billion yen is allocated for job security steps and 198.9 billion yen for structural overhaul-related measures, such as aiding hard-pressed small companies.

The extra budget also allocates 49.9 billion yen for antiterrorism measures and 26.5 yen billon to deal with fallout from the mad cow disease scare. Japan's first case was reported in September.

To help fund the package, the government will use a 458.9 billion yen surplus left over from the previous fiscal year's budget.

It will also draw on 1.157 trillion yen saved through cutbacks to previously envisioned allocations in the fiscal 2001 regular budget.

The extra budget brings the scale of the combined general-account expenditures for the current fiscal year to 83.71 trillion yen.