Key economic ministers put the compilation of an extra budget for fiscal 2002 on the political agenda Tuesday but maintained an official decision has yet to be made.
“If the disposal of nonperforming loans is to be truly accelerated, safety net measures will become necessary, and they should be prepared to use an extra budget,” Finance Minister Masajuro Shiokawa said.
Asked whether a schedule has been set for compiling the supplementary budget, Shiokawa said, “That has not been decided yet.”
He said that to finance safety net measures and make up for a tax revenue shortfall, the government should scrape together leftover funds to use before issuing fresh government bonds.
“We will not think about how much in government bonds we should issue before adding up such funds and assessing how much in shortfalls we will face as a result of that,” he said.
Issuing fresh government bonds would force Prime Minister Junichiro Koizumi to break his pledged 30 trillion yen fiscal discipline cap on government bond issues for the current fiscal year.
Takeo Hiranuma, head of the Economy, Trade and Industry Ministry, said at a separate news conference that the extra budget will probably be submitted to the next ordinary Diet session, which convenes in January.
“I have been calling for a supplementary budget to be compiled during a regular Diet session,” Hiranuma said. “And (Japan’s economic) situation demands that this be done with growing urgency.”
The government’s top spokesman meanwhile repeated the official line when asked about the possibility of the extra budget.
“Nothing has been decided on the extra budget,” Chief Cabinet Secretary Yasuo Fukuda said. “We will deal boldly and flexibly while observing economic and financial conditions.”
Government sources said Monday that Koizumi plans to soon issue orders to compile an extra budget for the current fiscal year to make up for the expected shortfall in tax revenues and fund a social safety net.
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