The surprise resignation of nine-day-wonder Ryu Matsumoto as minister for reconstruction has widened the rift between people in the disaster-stricken areas and the struggling Kan government.
The surprise resignation of nine-day-wonder Ryu Matsumoto as minister for reconstruction has widened the rift between people in the disaster-stricken areas and the struggling Kan government.
Matsumoto's indiscreet remarks on reconstruction caused an uproar not only within the disaster areas but also in the government, with voices wondering at the leadership's seemingly careless attitudes toward reconstruction.
Amid the confusion, a Cabinet meeting on July 5 endorsed a bill for a second supplementary budget that appears to be slapped together at best.
Most of the budget deals with pressing issues, including the ongoing crisis at the Fukushima No. 1 nuclear power plant, and leaves full-scale reconstruction measures to be dealt with later.
The fuss over Matsumoto "not only wasted valuable time but also impaired the trust of people in disaster-stricken areas in the central government," a senior Cabinet Secretariat official pointed out.
While reconstruction planning is expected to peak in one or two months from now, this bill for a second supplementary budget for fiscal 2011 appears to be a hastily penned effort.
The bill, endorsed July 5 by the Cabinet of Prime Minister Naoto Kan, is worth 1.9988 trillion yen ($24.6 billion), including expenses to deal with the nuclear accident.
The bill was quickly put together after Kan promised to step down once progress had been made on post-quake reconstruction. Full-scale reconstruction measures have been postponed to a third extra budget, which will be compiled under the next prime minister, and later efforts.
The second extra budget bill includes relief measures for people affected by the nuclear accident, high on the priority list of local communities.
It earmarked 96.2 billion yen for a "fund for the health of nuclear accident sufferers and children" that will be created by Fukushima Prefecture. The purposes of the allocation range from lessening radiation levels in school zones to providing children and pregnant women with dosimeters on a temporary basis.
Tokyo Electric Power Co., operator of the Fukushima No. 1 plant, is also expected to finance the fund, and Fukushima Prefecture will be virtually exempted from all financial responsibility.
Hiroyuki Aratake, chief of the living environment division of the Fukushima prefectural government, welcomed that plan.
"Health surveys have to cover long periods. We are happy that they are not being financed by a one-time budget but by a fund," he said.
An additional 250 radiation monitoring posts will be added nationwide to shore up measurements. Currently, every prefecture has at least one radiation monitoring post.
Three hundred billion yen has been allocated to increasing, from 50 percent to 80 percent, the ratio of central government subsidies for the relief of disaster-stricken households, aiming to help people rebuild their lives. The assistance is worth up to 3 million yen per household, in cases where homes were totally destroyed.
The remaining 20 percent is to be financed by local governments. However, the budget bill plans to exempt disaster-affected local governments from obligations by adding premiums on local allocation taxes.
The second extra budget bill has drawn mixed responses. In disaster-hit Miyagi Prefecture, an official at the financial section of the prefectural government said, "It's good news that new financial resources will arrive."
Meanwhile, a senior Finance Ministry official reacted coldly. "It's a budget of Kan, by Kan and for Kan. Nobody knows how effective it will be in terms of policies."
Pushing through a second extra budget was one of Kan's conditions for his resignation. He also insisted on passing a special bill to issue deficit-covering government bonds. Kan ordered the second extra budget bill to be compiled quickly after pledging to step down.
As expected, the bill falls far short of full-scale reconstruction measures.
In response to the nuclear accident, the bill allocated 7 billion yen to finance a new agency that will assist TEPCO with paying compensation for damage from the nuclear accident.
The bill also earmarked 2 trillion yen in "kofu kokusai" special government bonds, which can be cashed as need arises, to finance compensation payments, as well as a 2 trillion yen government guarantee to assist TEPCO with its fund-raising.
However, the bill to create the new agency, a precondition for the budget, has been submitted to the Diet but not yet entered deliberations.
Addressing the problem of "double-debt" enterprises, which were already in debt before being hit by the disaster, 77. 4 billion yen was allocated for measures ranging from relieving the interest burden on small and midsize enterprises to restoration of ice-making facilities for fisheries.
The debts on small and midsize enterprises in the coastal areas of the three hardest-hit prefectures of Fukushima, Miyagi and Iwate total 1.4 trillion yen.
Full-scale measures to buy up these debts to ease their burdens are just now entering the consideration phase. Resolving these problems will have to wait for the third extra budget, or perhaps later.