Spending by the central government on a set of economic stimulus measures to be finalized next week will exceed ¥40 trillion ($350 billion), expanding from its initial plan of around some ¥30 trillion due to cash handouts, sources close to the matter have said.
Under the COVID-19 relief measures, there will be ¥100,000 handouts in cash and vouchers for children aged 18 or younger as well as aid for students facing financial difficulties, the sources said Friday.
The package, which Prime Minister Fumio Kishida's Cabinet is expected to approve on Nov. 19, will also include financial aid of up to ¥2.5 million each for businesses suffering from plunging revenues due to the virus spread, and wage hikes of about 3% for child care and nursery school workers as well as nurses, the sources said.
Along with funds left over from the fiscal 2020 budget and the issuance of new bonds, the stimulus is planned to be financed by a supplementary budget, which Kishida's administration aims to enact following its passage during an extraordinary parliamentary session to be convened by the year-end.
Some policy measures will be funded by a budget for the next fiscal year starting in April. Additional fiscal spending could further dent the government's fiscal soundness, which is already the worst among major developed countries with over ¥1.2 quadrillion worth of public debt as of March.
Restarting the government's Go To Travel program, intended to subsidize travel spending to help the coronavirus-hit domestic tourism industry, will also be among the stimulus measures, the sources said. The program was suspended amid the rapid spread of infections.
Kishida has said the size of the package will be "several tens of trillions of yen."