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Aso Cabinet E-mail Magazine No.12 (Dec. 25, 2008 - Jan. 1, 2009)
* Next issue will be delivered on January 8, 2009.

"A bold, action-oriented budget to defend people's daily lives"
-- Message from the Prime Minister
(Provisional Translation)

Prime Minister Taro AsoProfile Japanese

I am pleased to announce that the formulation of the fiscal 2009 budget and of the second fiscal 2008 supplementary budget has just been completed.

These budgets are budgets to defend people's daily lives. I wish to name the budget for fiscal 2009 a "bold, action-oriented budget to defend people's daily lives."

The world is on the verge of a once-in-a-century recession. Abnormal economic circumstances demand exceptional responses. By taking bold measures, we aim to extricate ourselves from this recession the earliest of all countries.

In October we passed the first [fiscal 2008] supplementary budget. Following that, the specifics of the second supplementary budget [government proposal] were determined. And today, the fiscal 2009 budget [government proposal] has been completed. We will proceed with the three sets of measures in a seamless manner, as if they were a three-stage rocket.

The total scale of the three packages reaches 75 trillion yen. The total of fiscal spending and tax reductions amounts to 12 trillion yen. Twelve trillion yen is equivalent to 2 percent of gross domestic production (GDP). In the United States this is 1.1 percent and in Europe 1.5 percent, meaning that the scale of these measures is among the very largest of measures undertaken by any country.

First and foremost come measures to save employment.

The most pressing issue of this year-end period is people losing their homes. Employment-promotion housing facilities have already begun to accommodate such people, with decisions already reached on who will live in some 1,000 housing units.

Companies that extend regular employment contracts to temporary staff, students whose tentative employment offers have been cancelled and "freeters" (irregular and part-time or casual employees) who are relatively older will be awarded subsidies of between 500 thousand and 1 million yen. Furthermore, a fund of 400 billion yen will be established for the purpose of creating new jobs. The fund would nurture businesses in future-oriented fields, such as in the areas of nursing care or catering services for the elderly.

Since assuming the office of Prime Minister, I have always worked according to the same system: first, I indicate a broad policy; second, the government and the ruling coalition discuss the policy; and third, I take the final decision.

Throughout this process, there have been twists and turns, which have led some people to suggest that I might be losing my grip. Ultimately, however, I have been able to bring to fruition everything that I have instructed, and I have been able to incorporate everything that I instructed into these budgets.

First, with regard to the region-friendly one trillion yen, (a) the government will provide 940 billion yen of subsidies to create the foundation for revived local areas, aiming to enhance the usability of funds for the regions; and (b) tax revenues allocated to local governments will be increased by 1 trillion yen.

Second, the pension system must be made stable. Accordingly, the proportion of basic pensions funded by the government will be raised to a half starting next fiscal year, as promised.

Third, we are reaching the limit of curbing increases of social security expenditures -- an effort we have made each year over the past three years -- that continue to rise in line with the aging of society. As such, we will provide finance of 220 billion yen for social security expenditures, by rationalizing expenditures of the coming fiscal year and by securing funding resources (making use of fiscal revenues earmarked for road-related spending and of the fund from the special account for pensions).

Fourth, stable funding resources for the social security system must be secured so that it can give peace of mind to the public now and in the future.

The decision was thereby taken to take necessary legal measures in advance so as to ensure that fundamental reform of the tax system, including that of the consumption tax, can be implemented from fiscal 2011, based on the prerequisite of economic recovery.

I will present these budgets to the regular session of the Diet, which is scheduled to be convened on 5 January. The early passage and execution of these budgets will constitute the best possible economic countermeasures. This will determine the future of Japan's economy and, indeed, the future of Japan as a nation.

The Diet's ability to take decisions and its political will and resolve will be tested during the next Diet session. The question is whether or not the Diet can defend people's daily lives amidst this economic crisis.

The government and the ruling coalition have formulated what we consider the best possible proposal. We are certainly willing to discuss any good proposals that the opposition parties may have. However, there is simply no time for wasteful delay before reaching a final decision.

I will do everything in my power to defend the daily lives of the people. I am determined to see this crisis through. I will take on this crisis, leading the way without fear of criticism.

I ask the Japanese people for their understanding and support.

This is the final e-mail magazine of the year. Let us remain "strong and bright." I will close by extending my very best wishes to everyone for a very happy New Year.

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- Meeting of the Council for Science and Technology Policy and other topics (December 8, 2008 to December 14, 2008)

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- Press Conference by Prime Minister Taro Aso (December 24, 2008) and others

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General Editor: Prime Minister Taro Aso
Chief Editor: Deputy Chief Cabinet Secretary Jun Matsumoto
Publication: Cabinet Public Relations Office
1-6-1 Nagata-cho, Chiyoda-ku, Tokyo 100-8968, Japan

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