That the Osaka-based school operator withdrew its application to open a new elementary school on a tract of land purchased from the national government at a questionable discount does not end the controversy over the land deal. The government still needs to clarify how the land plot in Toyonaka, Osaka Prefecture, had been sold to Moritomo Gakuen at a fraction of its appraisal value and whether there was any political meddling in the deal between the operator and the Finance Ministry.

Yasunori Kagoike, president of Moritomo Gakuen, denied that the school operator had been given any political favors in winning a contract for purchase of the 8,770 sq.-meter government-owned plot of land at ¥134 million, or a mere 14 percent of the appraisal value of ¥956 million, when he announced the withdrawal of his application with the Osaka Prefecture last week to open the new school in April. He denied that Prime Minister Shinzo Abe — after whom he reportedly attempted earlier to name the school in soliciting donations for the school project — or his wife Akie — who had until recently been listed as “honorary principal” of the planned school — had done any favors for him.

Now that the school plan has been canceled, the Finance Ministry, in accordance with the terms of the contact, has demanded that the operator return the land to the government after dismantling the school building and restoring the plot to its original condition, in exchange for a refund of the installment payments that had already been paid to the government for its purchase. The land ministry also plans to urge Moritomo Gakuen to repay ¥56 million in subsidies that had been paid under the program to promote the construction of wooden buildings. However, settling the financial matters will not end the suspicions over the land deal itself.

The discount land deal drew heightened media attention because of the character of the school operator and its speculated links to Abe. A kindergarten that it runs in Osaka was known for its controversial nationalistic education, including making its pupils memorize the prewar Imperial Rescript of Education. Abe, who earlier described Kagoike as someone who “is said to have an excellent passion for education” and agrees with his own ideas, vehemently denied any connection to the school operator as attention focused on the position accorded to his wife at the planned school. Abe, who charged that the opposition camp was “manipulating the impression” by trying to tie him to the school operator, even said he would “resign as prime minister and from the Diet” if either he, his wife or his office was found to have been involved in the land deal.

The Abe element aside, many of the questions about the land deal remain unanswered even as Morimoto Gakuen’s new school plan is withdrawn. The government has said the land was sold at a steep discount by deducting ¥800 million from the plot’s appraisal value as the cost of removing waste material that had been found in the underground soil at the site during construction of the school building. But the way that cost was estimated seems murky, and the government has not confirmed that work to remove the waste material worth that amount was in fact carried out.

Reports have indicated that Moritomo Gakuen sought political influence to help it win favorable terms in the land deal with the Finance Ministry to open the new school. But the Finance Ministry refuses to look back on the detailed process of the negotiations with the school operator, saying that no records were kept of the process.

Moritomo Gakuen gave up on opening the new school next month as it increasingly became likely that its application with local authorities would be turned down at the last minute due to various other questions that emerged over the project, including contradictory estimates on the cost of the construction of the school building that the operator submitted separately to the national government and Osaka Prefecture. Osaka Gov. Ichiro Matsui has charged that either the estimate to the national government was inflated to win more subsidies or the one submitted to the prefecture was lowered to an amount less than it really was to make the school project look more financially tenable.

That disparity is among the questions over the school project that will not disappear and need to be answered even after the plan is scrapped. The Abe administration should not try to view the case is closed but instead make transparent what transpired behind the land deal.

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