The government plans to set aside a special fund of about 4 trillion yen to prioritize budgets in growth areas and other fields, The Yomiuri Shimbun has learned.
According to the draft outline of budget request guidelines for fiscal 2019, setting up this special fund is a pillar of the guidelines. Regarding the so-called natural increase in social security costs stemming from the nation's aging society, the guidelines also allow 600 billion yen more than the figure for fiscal 2018.
According to the draft outline, government ministries and agencies will be required to reduce their "discretionary spending" -- public works spending and other items that fluctuate depending on policy decisions -- by 10 percent from the fiscal 2018 budget.
In the special fund of about 4 trillion yen "to promote priority issues for a new Japan," funding will be given priority in growth areas such as development of artificial intelligence and new robot technologies aimed at eliminating labor shortages.
As to the natural increase in social security costs, the draft outline emphasized that the government will "make utmost efforts toward streamlining and making more effective" the social security system.
In the Basic Policy on Economic and Fiscal Management and Reform known as the "big-boned policy" adopted by the Cabinet last month, the government did not set numerical targets for curbing natural increases in fiscal 2019 and beyond. Attention will be focused on how much budgetary requests will be cut while compiling the budget.
The outline did not include specific figures for economic measures to be implemented to deal with the consumption tax rate hike in October 2019, only saying "measures will be studied during the process of compiling the budget."
The draft outline will be presented at a meeting of the Council on Economic and Fiscal Policy, which is scheduled to be held early this month.
The outline is expected to be approved by the Cabinet as early as July 10.
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