The government’s economic stimulus package of providing every child aged 18 and under with a handout of 100,000 yen ($ 880), including 50,000 yen in vouchers, is meeting resistance from local governments.
Their reason is that given the questionable effectiveness of this relief package, the burden of distributing them is far too heavy.
Some municipalities, including Osaka, Ota in Gunma Prefecture and Shimada in Shizuoka Prefecture, have already indicated their intention to remove coupons and pay the full amount in cash.
The government intends to set strict conditions for cash donations only. But that cannot impose additional burdens on local governments that are already overburdened with booster vaccination deployments and other pandemic response measures.
The choice between cash only and cash and coupons should be left to the discretion of each municipality.
The government plans to distribute 50,000 yen in cash before the end of this year, and then the remaining 50,000 yen in coupons next spring.
The government explains that this will ensure that the coupons are spent on child-related needs, and setting an expiration date will certainly encourage consumption and also help boost the local economy.
However, if the coupons are used to purchase items that people were planning on getting anyway, the money saved can simply be set aside for future use.
And people living in areas with few commercial facilities and after-school “juku” academies will have limited opportunities to use their coupons.
Administrative expenses related to the distribution of cash donations will be approximately 30 billion yen, compared to a maximum of 96.7 billion yen for the distribution of coupons. The government says it saved around 200 billion yen by excluding anyone earning more than 9.6 million yen a year from receiving the back-up plan.
But almost half of the savings are offset by coupon distribution fees.
When it comes to details such as what types of coupons to introduce, what they can be used for, and where they can be used, the government leaves virtually all decisions to local governments.
The economic stimulus package includes donations of 100,000 yen to children, pledged by ruling coalition partner Komeito during the Lower House election campaign, as well as donations of 100,000 yen to low-income households exempt from the tax. tourist tax, which was a campaign pledge of the Liberal Democratic Party.
The program itself smells like pork in a barrel, and the government is trying to cloud that impression with coupons.
The surge in handouts has to be blamed on the government’s failure to scrutinize and coordinate the system closely with the ruling coalition. The government is wrong to force local governments to pay for its own negligence.
It is absurd to invest massive amounts of expenditure and labor in a one-off policy. If the goal is to encourage the use of coupons, the government should first establish a system for their easy distribution and continued use, and create an environment that local governments would readily accept.
Prime Minister Fumio Kishida told the Diet that the cash-only option “will be available depending on the needs of local governments”.
On the other hand, the Cabinet secretariat explains in a document that cash-only distributions will only be made “if the distribution of coupons cannot begin before the end of June next year”, and that municipalities opting for cash distributions must “submit their reason in writing.
This is practically the same as forcing the distribution of coupons to local communities.
The Prime Minister’s statement to the Diet must not become an empty promise.
Kishida must move quickly to a flexible policy that allows cash distributions and sets specific conditions during supplementary budget deliberations that will begin in earnest next week.
–L’Asahi Shimbun, December 10