The Noda Cabinet on Saturday endorsed the fiscal 2012 budget to be submitted to the Diet. The general account spending will drop 2.2 percent from the fiscal 2011 initial budget to ¥90.33 trillion — the first fall in six years.
Spending for social welfare will fall 8.1 percent to ¥26.39 trillion. That for public works, defense and education/science will fall, respectively, 8.1 percent to ¥4.57 trillion, 1.3 percent to ¥4.71 trillion and 1.9 percent ¥5.40 trillion.
But one should not be misled. Spending in real terms will top ¥96 trillion — a record high — because the government will include ¥3.77 trillion for reconstruction from the March 11 disasters in a special account budget and issue ¥2.6 trillion pension-related special bonds not appearing in the general account budget.