The Democratic Party of Japan plans to freeze the launch of a public corporation designed to take over management of the pension system if it comes to power in the Aug. 30 general election, sources said Saturday.
Instead, the largest opposition party wants to preserve the Social Insurance Agency for the time being and take on the task of sorting out the millions of mismanaged pension records that surfaced in 2007 — one of its main election pledges.
In the next extraordinary Diet session, expected to be convened this fall, the DPJ, which envisions creating an agency that would be in charge of collecting both taxes and pension premiums, plans to submit a bill aimed at blocking the launch of the public corporation, which is scheduled for January, the sources said.
The DPJ has said the pension issue needs to be tackled intensively for more than two years as a national project. It is worried that establishing a new entity where employees would not have public servant status could undermine government oversight of pension issues.
After the record-keeping scandal broke, the government enacted a law in June 2007 to transfer the agency's pension division to a new corporation that would be put in charge of premium collection, pension payments and record-keeping.
The government, led by the ruling Liberal Democratic Party and New Komeito, set a deadline of next January for transferring the agency's pension duties to the new body.