National

Kinki finance staff met with Osaka officials five times to hash out Moritomo's school application

by Eric Johnston

Staff Writer

The Osaka Prefectural Government announced Thursday that staff from the Finance Ministry’s Kinki Local Finance Bureau met with its officials five times over 16 months to discuss scandal-plagued Moritomo Gakuen’s application to open a new elementary school, placing pressure on officials in the final meeting to settle things quickly.

The announcement came after a weeks-long investigation by the prefecture into whether Moritomo Gakuen received preferential treatment. The opening of the school has been indefinitely postponed by a scandal in which the private school operator, which advocates a nationalistic education, received a suspiciously large discount on a piece of government property.

Yasunori Kagoike, who was head of Moritomo Gakuen at the time of the land purchase, is also under investigation for submitting different construction cost estimates to the prefecture, the central government and the original owner of the parcel purchased for the new school in Toyonaka, Osaka Prefecture.

According to the prefecture, the first of the five meetings between the prefectural and Kinki Local Finance Bureau officials took place on Sept. 12, 2013, at a time when the school’s operator had been told by the central government that the property and what Moritomo wanted to build on it could be rented first, as long as it was purchased at a later date.

At that point in time, Kagoike could not afford the ¥956 million the land was valued at and decided renting was the best option.

He later purchased the land after approval to open the school had been granted and the price had been slashed to ¥134 million for reasons yet to be determined.

The prefecture says that, during the second meeting in November 2013, its officials were shown a proposal for financing by the regional bureau. The prefecture replied that since approval for the school had yet to be granted, it was difficult to reply to the proposal.

Things remained static until late July 2014, when the regional bureau asked Osaka if any progress had been made on the issue. They asked the same question again just over two months later, in early October. At this point, Moritomo had not officially applied to open the school but did so at the end of that month.

With the application still under review in January 2015, the Kinki finance bureau met with Osaka officials for a fifth time and asked when approval would be handed down, reportedly suggesting to the prefecture that it could control the schedule of the review process. The prefecture replied that, even if a reply was given, it didn’t mean it would be a nod of approval.

However, about three weeks later, the prefecture gave conditional approval for the elementary school, despite concerns about whether it would attract enough students to meet local regulations for operating a private school and doubts about whether its financing plan was sound.

The central government has denied it pressured Osaka Prefecture to grant approval. The prefecture’s investigation was based largely on individual memories of the events and interviews with officials, who said they did not take official notes of the meeting.

Osaka Gov. Ichiro Matsui has called on the Finance Ministry and the Kinki Local Finance Bureau to release their own records of the five meetings.

In Diet testimony last month, the Finance Ministry said records of individual meetings were only stored for one year and that the computer data had been automatically destroyed.