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Audit finds no grounds for massive discount in Osaka land sale involving Abe-linked school operator

by

Staff Writer

The government sold land in Osaka to school operator Moritomo Gakuen for a highly discounted price based on faulty data estimating the cost of removing industrial waste left in the plot, a government watchdog on spending concluded in a much-awaited report released Wednesday.

The conclusion by the Board of Audit is likely to give further ammunition to opposition lawmakers who suspect the Finance Ministry gave a massive 86 percent discount in the ¥134 million land sale because the school operator once had close ties with Akie Abe, the wife of Prime Minister Shinzo Abe.

Both the prime minister and his wife have repeatedly denied any involvement in the sale, and the ministry has maintained that the price was determined appropriately.

Ministry officials, however, were quick to discard key documents involved in the price negotiations with the school operator, which has deepened the public’s suspicion over the land deal.

The Finance Ministry claimed that the land price was greatly discounted because it estimated 19,520 tons of industrial waste was buried underneath the ground in the compound and it would cost ¥819.7 million to remove it. But the report suggested the amount of the waste was likely far less than the ministry’s estimate. The board, using several different methods of calculation, showed the range could have been between 6,196 tons and 13,927 tons.

The board also said that it could not estimate the exact cost of disposing the waste, pointing out that many documents were discarded or not produced by government officials. The board “has recognized situations (linked to the sale), which are not necessarily appropriate” and the government “should have more carefully studied” the land deal conditions, the reported read.

Meanwhile, prosecutors are reportedly questioning officials in the Finance Ministry’s Kinki bureau on suspicion that they may have committed a breach of trust by selling the state land at an unjustifiably low price.

The board submitted its report to the Diet earlier Wednesday. Opposition lawmakers are believed to be ready to grill government officials further before the Diet, based on the report.

The Finance Ministry originally estimated the value of the 8,770-square-meter lot in Toyonaka, Osaka Prefecture, at ¥956 million.

The land deal, first reported by the Asahi Shimbun newspaper earlier this year, has drawn particular attention because the school operator, then headed by Yasunori Kagoike, was known for its ultranationalistic education policies.

The Moritomo Gakuen scandal was considered a key factor in the decline of the Cabinet’s approval rating earlier this year.

According to Kyodo News, the board estimated the waste disposal cost to be in the range of ¥200 million to ¥400 million.

The report, however, did not mention any of the estimated costs reported for the waste disposal.

Kagoike and his wife, Junko, have been indicted on charges alleging they tried to deceive the government in order to receive public subsidies for their schools.