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Gov't considers cutting $2.85 bil. budget on contractor to boost tourism in Japan

The Ministry of Economy, Trade and Industry is seen in Chiyoda Ward, Tokyo, on Feb. 2, 2019, in this file photo. (Mainichi/Kazuo Motohashi)

TOKYO -- Japan's tourism minister has admitted that the government's budget to spend up to 309.5 billion yen (about $2.85 billion) to find a contractor to oversee a project to boost demand in the leisure sector, which has been heavily damaged by the coronavirus pandemic, is "fairly unprecedented" and said the government plans to cut the cost as much as possible.

At a meeting of the House of Representatives Committee on Land, Infrastructure, Transport and Tourism on June 3, tourism minister Kazuyoshi Akaba conceded that the amount was unusually high. He went on to say, "We will reduce costs as much as we can so we'll be able to completely fulfill our accountability." He added, however, that the identities of the individuals making up a third-party panel to select the contractor would not be publicized; nor would the minutes of their deliberations.

The campaign as a whole was allocated 1.7 trillion yen (about $15.68 billion) in the initial supplementary budget approved at the end of April. Regarding the basis for the calculation of 309.5 billion yen in outsourcing expenses, Akaba said, "The Ministry of Economy, Trade and Industry (METI) envisaged it would be around 18% (of operational fees)." Akaba also cited the costs to commission a contractor to support tourism in the Yamagata and Niigata prefecture areas after a powerful earthquake in 2019, which came to about 20% of the total cost, saying, "The arrangement is not without a basis."

An economy ministry official said the 309.5 billion yen would "cover overall organizational costs such as reporting responsibilities, responses to enquiries, campaign advertising, and personnel costs associated with various business activities."

Opposition parties, however, have been critical, with Satoshi Arai of the main opposition Constitutional Democratic Party of Japan arguing, "The administrative cost is too high, and the budget should be cut."

Contractors are being sought jointly by METI, the Ministry of Land, Infrastructure, Transport and Tourism and the Ministry of Agriculture, Forestry and Fisheries from May 26 to June 8. The businesses will be chosen after screening by a third-party panel specializing in four fields including tourism, restaurants, shopping streets and events.

Hajime Yatagawa, a member of the opposition Democratic Party for the People, has called for the government to "publicly disclose the names of the third-party committee members and the minutes of their discussions for inspection afterward." But an official at the economy ministry rejected the request, saying, "Because it is an inspection committee for an individual project, we are not considering releasing the names of those involved or the minutes of their discussion."

(Japanese original by Akihisa Kudo, Business News Department)

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