The health and welfare ministry announced on Nov. 9 that the number of people on welfare receiving livelihood assistance known as seikatsu hogo (literally livelihood protection) reached 2,050,495 nationwide as of July 2011, topping the monthly average record of 2,046,646 marked in fiscal 1951, when Japan was in the midst of postwar social and economic confusion. Behind this is an increase in the number of elderly people and prolonging economic stagnation.

Especially worrisome is the fact that the number of working-age people who cannot find jobs and have to rely on livelihood assistance is rapidly increasing. The effects of the 3/11 disasters and the eurozone crisis may worsen the situation. There is no quick fix. It is important for both the central and local governments to take effective measures to stimulate the economy and to help unemployed people find jobs.

The number of welfare recipients started falling in the mid-1980s amid an economic bubble. But it started rising after hitting a bottom in fiscal 1995 when the monthly average of recipients was about 880,000. It started soaring after the Lehman Brothers shock in the fall of 2008 and topped 2 million in March 2011.

In July, 1,486,341 households were receiving livelihood assistance, a rise of 6,730 from June. The ministry said that about 16 out of every 1,000 people are on welfare. But the figure is lower than about 24 out of every 1,000 people in 1951. By prefecture, Osaka has the largest 294,902 people on welfare, followed by Tokyo’s 272,757. In Osaka City, one out of every 18 residents is on welfare — the biggest rate in the whole nation.

Every month in fiscal 2010, an average 1,410,049 households (1,952,063 people) were on welfare, a record number and a rise of 135,818 from fiscal 2009. Of them, 43 percent were households of elderly people; 33 percent, households with disabled or invalid people and 8 percent, mother-and-child households.

Attention should be paid to the fact that the percentage of “other households” on welfare, which include households of unemployed working-age people, rose from 10 percent in fiscal 2009 to 16 percent in fiscal 2010 — about twice the corresponding percentage 10 years before. In July 2011, this category consisted of 251,176 households, about four times the corresponding figure 10 years before.

In the past, elderly people accounted for most of the recipients of livelihood assistance. But the situation has completely changed from the years of high economic growth. If working-age people have lost jobs these days, it is extremely difficult to find new jobs. If the period for receiving unemployment insurance benefits expires, sustaining their life becomes difficult. About 30 percent of new welfare recipients in fiscal 2010 cited the loss or reduction of bread earners’ income — the largest percentage among reasons to go on welfare. In addition, one-third of Japan’s work force is irregular workers, such as part-timers and temporary workers. They are not fully covered by unemployment insurance. Under current conditions, many working-age people have no choice but to receive livelihood assistance once they lose their jobs.

In fiscal 2010, the total outlay for livelihood assistance reached some ¥3.4 trillion. The central government shoulders three-quarters of it and local government the remaining quarter. The outlay for fiscal 2011 is almost the same on a budgetary basis. If the number of recipients of the assistance increases, both the central and local governments will face financially trouble. In many municipalities, the livelihood assistance outlay already accounts for more than 10 percent of their general account budgets.

Problems related to livelihood assistance have been reported — such as people receiving the assistance while hiding income, medical institutions giving unnecessary treatment to welfare recipients in order to get medical service payments covered by livelihood assistance, welfare recipients having psychotropic drugs prescribed with the aim of earning money by reselling them and businesses ripping off people on welfare for low-grade accommodations offered to them.

Some municipal governments suggest that livelihood assistance should be stopped for recipients who make no efforts to become self-supporting or that people on welfare should be required to pay part of their medical costs. But a careful approach is required in solving these problems because livelihood assistance is the last-resort social safety net based on Article 25 of the Constitution, which says, “All the people shall have the right to maintain the minimum standards of wholesome and cultured living.” Many elderly people have no choice but to rely on livelihood assistance because they have no income or their pensions are extremely low, although drastic reform of livelihood assistance is necessary because it was designed when Japan was enjoying high economic growth and its population was increasing.

The central government in October started a system of helping job seekers by providing them free vocational training and offering a monthly allowance of ¥100,000. Efforts must be made to directly involve business enterprises in this scheme so that vocational trainees can easily find employment and to enlarge the scope of vocational training to include new areas such as nursing care and assistance in medical services.

The most important thing is for the central and local governments to make strenuous efforts to ensure economic recovery. They also should consider raising minimum wages to give welfare recipients incentives to work.

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