TOKYO -- The government on June 5 announced that it would temporarily halt a search for contractors for its "Go To" campaign to boost the tourism and restaurant industries, which have been badly hit by the coronavirus pandemic, due to criticism over the huge cost.
The government planned to leave bidding open until June 8, but criticism erupted from opposition parties over the high cost of the contract, which was capped at 309.5 billion yen (about $2.82 billion). It subsequently decided to review the project from the ground up, including the method of soliciting contractors.
Initially the campaign was slated to begin in July, but due to the suspension of bids, it now appears that there will be a significant delay.
The "Go To" campaign is backed by the Ministry of Economy, Trade and Industry, the Ministry of Agriculture, Forestry and Fisheries, and the Ministry of Land, Infrastructure, Transport and Tourism, In the first supplementary budget approved at the end of April, the campaign was allocated 1.7 trillion yen (about $15.51 billion).
The campaign is grounded in support for the travel, restaurant, and event sectors, as well as for shopping streets. In addition to subsidizing half the cost of domestic tours, coupons will be issued for restaurants and souvenir shops.
Meanwhile, the economy ministry on June 5 disclosed that it would have a hearing with opposition parties to explain details of a separate program to support businesses that have suffered major declines in earnings due to the novel coronavirus outbreak. The contract for that work was originally awarded to the Tokyo-based Service Design Engineering Council, which then almost wholly subcontracted it to advertising giant Dentsu Inc. for some 74.9 billion yen (about $683.64 million).
According to an explanation from the ministry, Dentsu outsourced work to support payment of subsidies and applications to five group companies including event production and management company Dentsu Live for a total of about 64.5 billion yen (about $558.68 million). A ministry official commented that expenses would be thoroughly screened following the completion of the work and then paid out, and that it would check to avoid unnecessary expenses.
(Japanese original by Akihisa Kudo, Yuki Takahashi and Shiho Fujibuchi, Business News Department)