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The government reorganization that took effect last Saturday is designed to create an administrative system more responsive to the needs of the times, with politicians, not bureaucrats, taking the initiative in shaping public policy. In the most drastic bureaucratic reform in half a century, the number of ministries and key agencies has been cut almost in half, from 22 to 12. At the same time, the Prime Minister’s Office has been restructured into the more powerful Cabinet Office.

Perhaps the most important feature of the shakeup is the strengthening of Cabinet functions. This means that national policies are framed by politicians, particularly the prime minister and Cabinet members. Elite bureaucrats who in the past effectively made policy will play only supporting roles. The name of the game is “political leadership,” the key to building a more effective administrative system that is “simplified, efficient and transparent,” as the Commission on Administrative Reform puts it in its final report.

The challenges confronting the government are daunting. The relentless tide of globalization, the graying of society and the information-technology revolution, to name just a few, all demand that the right decisions be made promptly according to an integrated national strategy. Obviously, the Cabinet must play the controlling role, with the prime minister setting the pace and direction for basic policy with the help of the Cabinet Secretariat and the Cabinet Office.

Another contribution to political initiative is the appointment of more parliamentarians to sub-Cabinet posts in all ministries and agencies. These “deputy ministers” and “parliamentary secretaries” (ministerial aides), numbering nearly 50 in all, will give politicians a much greater say in the policymaking process. However, they must be careful not to put ministerial interest before public interests. They must resist pressures from interest groups and fight the bureaucratic tendency to keep the status quo. Bureaucrats themselves must change their turf mentality.

The Cabinet Office, headed by a state minister extraordinary, stands one rank above the ministries and agencies. In addition to assisting the Cabinet, it has a broad range of coordinative functions. It has a variety of policy-advisory forums, including the Council on Economic and Fiscal Policy, a blue- ribbon group that includes private economists.

The 10-member panel sets basic policies for economic and fiscal management, including those for the government budget. It remains to be seen, however, whether the prime minister will be able to demonstrate leadership in ways that also reflect the views of his private advisers. The council’s immediate task is to map out plans for economic recovery and fiscal consolidation. The fiscal 2001 budget, completed in late December, remains in deep deficit. Long-term debt continues to rise.

The government reorganization is not the end but only the start of bureaucratic reform. If the shakeup ends in nothing but the physical consolidation of government offices, it will be a flop. There is already criticism that it has produced only “megaministries” in the name of administrative reform. That criticism will linger unless the reorganization leads to the dismantling of the vertically integrated administrative structure and the streamlining of the bloated bureaucracy.

There is much to be done in order to achieve these objectives. The myriad administrative services now available must be sorted out, and those that no longer require government control must be either privatized or transferred to local authorities. Policy-planning and -implementing functions must be completely separated. Not least, work quality must be improved to boost the effectiveness of the organizational overhaul.

Furthermore, some of the public entities now under government jurisdiction, such as national universities, should be reorganized into independent “agencies” as planned. Other plans in the works, such as cutting the number of civil servants and introducing a policy-evaluation system, should also be put into action. All these are essential to enhancing transparency in public administration and cutting the administrative machinery down to size. It is also essential to retool public corporations, update the civil-service system and promote municipal mergers and deregulation.

In December 1997, the Commission on Administrative Reform recommended a drastic reorganization to then Prime Minister Ryutaro Hashimoto, currently the state minister in charge of administrative reform. Now the old bottle of administration has been replaced by a new one. But the new wine of political leadership has yet to be put in the new bottle.

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