Japan Press Weekly

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2019 October 9 - 15 [POLITICS]

Koike at Upper House plenary meeting: Raise minimum wages, not consumption tax

Japanese Communist Party Secretariat Head Koike Akira on October 9 at the House of Councilors plenary meeting grilled Prime Minister Abe Shinzo about government policies on medical insurance, public pension programs, and minimum wages.

Koike in his interpellation said that the Abe government this month raised the consumption tax rate under the pretext that the tax hike is to fund social welfare programs. However, Koike pointed out, the government intends to impose heavier medical burdens on the general public and slash public pension benefits.

Koike noted that the government is considering adversely amending the public health insurance program for the elderly aged 75 and older in order to levy more medical fees on them. In refuting the government explanation that this measure is necessary to address the inequality between older and younger generations, Koike cited the fact that people aged 75 and older are 2.3 times more likely to consult a doctor and 6.2 times more likely to be hospitalized compared to those under 75 years of age. He said that what the government intends to do will increase the inequality between generations and lead to the deterioration of health conditions of older generations.

Concerning the public pension programs, Koike insisted that in order to reduce the financial anxieties of pensioners, the government should abolish the macroeconomic slide system which automatically reduces national pension benefits. Koike explained that JCP proposals on the public pension system, including collecting more pension premiums from higher income earners and using public pension reserves in a carefully planned way to maintain the government’s payment level, should be implemented.

In response, Prime Minister Abe Shinzo just said that the government is working to improve the pension fund’s financial soundness by strengthening the economy. He did not mention any concrete measures to ease pensioners’ financial concerns.

Koike stressed, “The government should raise minimum wages, not the consumption tax,” adding that higher minimum wages will give a boost to local economies and reduce the over-concentration of the labor force in higher wage areas.

Koike also said that an increase in regional minimum wages must be combined with adequate financial support for small- and medium-sized enterprises. He criticized the Abe government for spending less and less on measures to support SMEs and pointed out the flaws in the existing support program designed to encourage SMEs to offer higher wages to their workers. Koike explained that the program subsidizes SMEs that invested in equipment as well as increased wages. Most SMEs are in red and have difficulties making capital investments and applying for financial support and as a result, only 30% of the budget allocated to the subsidy program was actually utilized, Koike said.

Koike said that many SMEs call for the reduction in employers’ share of social insurance premiums and that the government should offer financial support to achieve this demand.

Abe paid no attention to SME’s earnest call, saying that the reduction in social insurance premiums will not improve SMEs’ productivity.

Past related article:
> Abe gov’t’s insufficient support for SMEs poses obstacle to implementing higher minimum wage [July 13, 2019]