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The Social Insurance Agency announced punishment of 1,752 employees Monday over a scandal in which they improperly exempted people from national pension dues to claim better performances in collecting the premiums.

A total of 169 were punished under the National Civil Service Law, with six suspended from work, 81 having their pay cut, and 82 reprimanded. Others were punished under internal agency rules.

Among punished employees, eight were from the central agency, including Director General Kiyoshi Murase. Murase and three other central agency officials were issued a warning under the agency’s internal rules for insufficient supervision.

The agency also plans to carry out a major personnel reshuffle in early September, including demoting those legally punished.

According to the agency’s investigation announced Aug. 3, 116 of the 312 social insurance offices nationwide were involved in the scandal. It first came to light in February, with officials inappropriately exempting or granting grace of payment to about 220,000 people.

The agency said about 160,000 people were improperly categorized as “absentees” even though they were in arrears for long periods.

In December, some 2,700 employees, including about 1,000 disciplined under the law, were punished over unauthorized access to pension payment records of lawmakers and celebrities.

Tax hike urged

The leader of Japan’s most powerful business lobby said Monday the consumption tax should be raised to finance the social security system in the face of the rapidly aging population and dwindling birthrate.

Social security costs should be covered with “an expansion of the consumption tax in a manner that enables wide-ranging generations to shoulder due burdens,” Fujio Mitarai, chairman of the Japan Business Federation (Nippon Keidanren), said in a speech in Tokyo.

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