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Fukuda Cabinet E-mail Magazine No.24 (March 27, 2008) ============================================================

"On the issue of revenue sources for roads. This is Yasuo Fukuda."
-- Message from the Prime Minister
(Provisional Translation)

Prime Minister Yasuo FukudaProfile Japanese

On the issue of revenue sources for roads. This is Yasuo Fukuda.

The ruling coalition and the opposition parties have a conflict of views concerning the issue of earmarking revenue sources for roads and the tax on gasoline. In order to ensure that this conflict does not cause disruption to the everyday lives of the people, the two sides must promptly enter into talks to find a way out of the current impasse.

I have no intention of plowing on with the Government's original proposal. I am fully prepared to make sweeping reviews of the points that I believe need to be reviewed, so I very much hope that the opposition parties, in particular the Democratic Party of Japan, will agree to meet for talks.

The first point for review is the way revenue sources earmarked for roads have been used. It has come to light that a considerable amount of this money has been squandered on purchases of articles used for relaxation or on paying for recreational trips organized by public interest corporations for their employees, among other things.

Without reservation I apologize to the taxpayers for the fact that their money has been used in this fashion. Such improper, wasteful spending must be eradicated once and for all.

This waste was mainly engendered by single tendering procedures. I will ensure that the most cost-effective contracts are awarded, by carrying out a thorough-going review of the single tendering procedure system and introducing competition for orders. In addition, I will be carrying out a review of public interest corporations that depend largely on single tendering procedures to obtain their orders. I am fully prepared to disband such organizations wherever necessary, and this will include the elimination of the practice of senior government officials obtaining posts in such organizations after retirement from public office.

The second point for review is the current road development plan. The plan calls for 59 trillion yen over 10 years, but it has been pointed out that there are still a great many areas of this plan that could have room for review -- for example, a question mark hangs over the high cost or the necessity of some of the planned roads.

Roads that are needed must be built. At the same time, we must earnestly take into consideration the doubts that have been raised. I will carry out a comprehensive review of the road development plan by carefully scrutinizing, using the latest data, whether the planned roads are really necessary.

I will hold consultative meetings with the members of the opposition parties, so that we can work together to make a new road development plan.

The third point for review is the gasoline tax and other taxes, which are sources of revenue earmarked for roads. I will review these taxes with the eventual aim of reallocating them to the general budget, which in other words means not using the revenue from the taxes exclusively for building roads.

By shifting this revenue to the general budget, I will make it available for measures to tackle the plethora of issues faced by the Government, including the enhancement of emergency medical services, countermeasures against the declining birthrate, and various global warming countermeasures such as the development of new energy sources that do not emit CO2.

Nearly a month has passed since the bill on the taxation system for the new fiscal year starting this April was sent to the House of Councillors, yet so far it has not been deliberated on even once.

My concern is that failure to enact the bill by April 1, rendering it overdue, will impact the everyday lives of the people in manifold ways. The cut in the gasoline tax will lead to confusion at gas stations, and the reduction in the source of revenue earmarked for roads will leave local governments across the nation with serious revenue shortfalls.

We are running out of time, and nothing can get started if the ruling coalition and the opposition parties try to pin the blame on each other. It is unacceptable for the general public to have to pick up the tab for the strife between political parties.

Rooting out wasteful spending. Reviewing the road development plan. Shifting revenue to the general budget.

My position is that I will carry out the necessary reviews of the revenue sources earmarked for roads, and from this standpoint I intend to work to my utmost to create the opportunity, one way or another, to hold talks with the opposition parties. I believe this is essential if we are to avoid any disruption to the everyday lives of the people.

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General Editor: Prime Minister Yasuo Fukuda
Chief Editor: Deputy Chief Cabinet Secretary Matushige Oono
Publication: Cabinet Public Relations Office
1-6-1 Nagata-cho, Chiyoda-ku, Tokyo 100-8968, Japan

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