The House of Representatives on Monday passed a fiscal 2002 extra budget aimed at countering the negative effects of an accelerated cleanup of the banking sector.
The budget will be deliberated in the House of Councilors, where it is expected to be endorsed as early as Thursday. Passage through the powerful Lower House ensures its enactment, regardless of approval by the upper chamber.
The supplementary budget features 1.5 trillion yen allocated to public works projects. Another 1.5 trillion yen will go to knitting a safety net that will ease the fall of those who lose their jobs due to an expected surge in corporate bankruptcies as banks accelerate the disposal of nonperforming loans.
Its approval by the House of Representatives followed an endorsement by the Lower House budget committee earlier in the day.
The committee’s final deliberations were halted for around an hour in total after an opposition lawmaker demanded clarification of the employment-boosting effects of the fiscal 2001 second extra budget.
Akira Nagatsuma of the Democratic Party of Japan demanded to know how many jobs had been created — and whether this figure had reached the targeted number of 110,000.
Although Finance Minister Masajuro Shiokawa cited surveys as showing that 90 percent of public works projects had been implemented as of October, he said it was difficult to put a specific number on jobs created.
But Heizo Takenaka, economic and fiscal policy minister, said that the 110,000 figure cited above did not constitute a government goal and that the figure was based on a macroeconomic model.
Shiokawa promised to investigate the matter and present an estimate at an early date.
The latest supplementary budget also includes 1.2 trillion yen aimed at financing increases in obligatory costs, such as social security spending.
It requires the issuance of 4.97 trillion yen in government bonds, bringing the total bond issuance for fiscal 2002 to 34.97 trillion yen.
Prime Minister Junichiro Koizumi abandoned a campaign pledge to keep bond issuance under 30 trillion yen in fiscal 2002 in the face of a sagging economy and plunging tax revenue.
The extra budget was compiled along with an 81.79 trillion yen budget for fiscal 2003 that was submitted to the Diet last week.
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