Japanese PM vows assault on bureaucracy

Yukio Hatoyama vowed to revolutionise the way Japan’s economy was governed by ending bureaucratic control of budgets and cracking down on waste, in his first policy address to parliament as prime minister of Japan on Monday.

Mr Hatoyama, who led the Democratic Party of Japan to a historic victory over the Liberal Democrats in August, acknowledged that the “most important topic” for his administration was safeguarding Japan’s recovery from the fierce recession into which it plunged last year.

But he made clear he has much higher goals, promising a “180-degree turn” away from bureaucratically controlled policymaking to politician-led politics.

“The first thing we must do under this new system is conduct a great clean-up of the postwar administration,” Mr Hatoyama said, blaming officials’ influence over government for the waste of public funds. The government would introduce a cabinet-led approach to setting the national budget and raise spending transparency to try to win the confidence of taxpayers.

Democratic policymakers believe cutting waste will not just ease Japan’s parlous fiscal situation but also make it politically possible to eventually raise taxes to reduce gross government debt, now approaching 200 per cent of gross domestic product, the highest in the developed world.

As evidence of Democratic determination to clean up government bodies and state enterprises, Mr Hatoyama cited the trimming of about Y3,000bn in “un-needed or non-urgent” spending from a supplementary stimulus budget launched by the Liberal Democrats this year.

In a sign of the challenge of translating the Democrats’ ideals into practice, Mr Hatoyama gave few details of policy or of which government departments and state enterprises might bear the brunt of the savings drive.

The government faces strong resistance from interest groups and local authorities even to pledges included in its manifesto.

Mr Hatoyama was also studiously vague on his plans for handling his most pressing foreign policy problem: US impatience at the Democrats’ desire for a rethink of the long-discussed relocation of a US marine air base on the southern island of Okinawa.

Differences over the issue threaten to cloud a visit by Barack Obama, US president, to Tokyo next month, and even some of Mr Hatoyama’s cabinet colleagues believe there is no realistic chance of satisfying the hopes of Okinawa residents who want the base moved off the island.

Yet Mr Hatoyama merely said he would “grapple seriously” with the issue.

The prime minister said his administration marked a historic turning point on the order of the 1868 Meiji Restoration that paved the way for Japan’s emergence as a modern state.

However, his promise of a new kind of politics will expose him to criticism from the Liberal Democrats over problems at his own fund-raising organisation, following revelations it misreported donations and listed some as coming from people who were actually dead.

Mr Hatoyama, who has blamed an aide for the problems, promised to “co-operate fully” with an investigation to “restore trust in politics”.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.