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The government may scrap a plan to build a new headquarters for the Finance Ministry, which is now housed in a quake-vulnerable structure dating back to the war, three government officials said.

The government may instead spend around ¥16 billion to renovate the current building rather than pay about ¥58 billion to erect a high-rise, said one of the officials, who spoke on condition of anonymity because the person isn’t authorized to talk to journalists. The five-story building, built in 1943, is at risk of collapsing if a large quake shakes the capital, according to a document on the ministry’s website.

Abandoning the headquarters construction plan would underscore the government’s need to save money to reduce a public debt twice the size of the economy and pay for rebuilding after the March 11 earthquake. The ruling Democratic Party of Japan has proposed selling the government’s stake in Japan Tobacco Inc. to help fund the reconstruction.

“The Finance Ministry must be thinking it can’t stand out with a brand-new, shiny building when Japan’s fiscal state is so severe,” said Takeshi Minami, chief economist in Tokyo at Norinchukin Research Institute Co.

A government-led panel on state assets recommended in 2007 that a new high-rise be built for the Finance Ministry that would be quake-resistant and house other agencies, according to the document. The current home of the ministry, which is in charge of budget, tax and currency policies, is dwarfed by neighboring government high-rises that went up in recent years, including the 38-story education ministry building.

The land and infrastructure ministry, which oversees government buildings, may submit a plan to renovate rather than construct a new building, as part of its budget request for the year starting next April, the official said.

The land ministry can’t comment because it is still compiling its spending request, a spokesman said on the condition of anonymity, citing government policy.

A land ministry report in 2006 said the Finance Ministry’s building fell short of its standard for quake resistance, meaning that if the largest temblor on the Japanese seismic intensity scale hits Tokyo, there’s a danger of it collapsing, the document on the ministry’s website said.

Japan plans to spend ¥19 trillion over the next five years to rebuild after the record temblor and tsunami devastated the northeast and prompted world’s worst nuclear disaster in 25 years. The government has already approved two packages totaling about ¥6 trillion.

Public debt in the world’s third-largest economy is projected to reach 219 percent of gross domestic product next year even before accounting for borrowing to fund reconstruction after the March catastrophe, according to the Organization for Economic Cooperation and Development.

Moody’s Investors Service lowered Japan’s sovereign debt rating by one step to Aa3 last month, saying that rebuilding costs after the disaster may make it hard for officials to meet their borrowing target this year.

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