Providing a monthly child allowance of ¥26,000 for each child aged 15 or younger to all the child-rearing families was one of the primary campaign promises made by the Democratic Party of Japan in the August 2009 Lower House election and it began providing half the amount in fiscal 2010. The basic concept behind the universal child allowance was that society as a whole should help child-rearing families irrespective of their income levels.

But a child allowance bill passed by the Lower House on March 23 with the support of the DPJ, the Liberal Democratic Party and Komeito set an income cap on families eligible for the allowance. It is expected to be enacted Friday by the Upper House.

After the DPJ’s defeat in the July 2010 Upper House election, the opposition forces gained control of the chamber. Both the LDP and Komeito have fiercely battled with the DPJ over the child allowance. The DPJ government has also had problems securing the funds to continue the universal allowance. Still, it is regrettable that an income cap was introduced.

Under the bill, ¥15,000 each a month will be given to a child younger than 3 years old; ¥10,000 each for the first and second child who is older than 3 and up to the last year at primary school; ¥15,000 each for the third and younger children in the same category and ¥10,000 each for middle school students.

But any child-rearing family in which either the father or the mother earns ¥9.6 million or more annually will lose eligibility for the monthly allowance. As a special measure for such families, ¥5,000 a month will be given for each child “for the time being.”

Health and Welfare Minister Yoko Komiyama, who calls herself the prime mover of the DPJ’s child allowance plan, insisted obstinately that even the bill, which is a compromise between the DPJ on the one hand and the LDP and Komeito on the other, retains its basic spirit of the DPJ’s original child allowance.

But this is not true. The three parties — the DPJ, the LDP and Komeito — should be criticized for destroying the basic concept of the universal child allowance.

Probably the strongest reason that the DPJ was forced to give up the basic concept is its failure to properly treat a tax burden on child-rearing families and their eligibility to receive the child allowance in an integrated manner. Imposing a heavier tax burden on high income families, while providing them with the child allowance if they have children, would not have been a contradiction.

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