With the national budget expected to swell due to spending on key policies in the coming years, Japan will need to establish one independent body to monitor the country’s long-term fiscal health and another to analyze the effectiveness of critical national policies, according to a proposal by a group of scholars and business leaders.
“To ensure that future generations will have a Japan that grows and improves in a sustainable manner ... it is essential to approach the country's policies and finances with a long-term perspective and not just deal with issues of the moment,” the independent group — called Reinventing Infrastructure of Wisdom and Action, also known as Reiwa Rincho — said in a statement issued on Friday.
Although the government annually releases a projection of the fiscal situation for the next 10 years, there should be a longer-term forecast, as Japan’s population is expected to shrink over the next several decades, which could impact the country’s overall fiscal health, Reiwa Rincho said.