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Editorial: Japan's 100,000-yen handout plans for youths hardly fair

Japan's ruling and opposition parties have agreed on giving 100,000 yen (about $875) in cash and coupons to young people aged 18 or under in the country. The move is reportedly expected to be a pillar of the economic stimulus measures to be decided next week.

    If this is the "distribution" policy that Prime Minister Fumio Kishida has placed such emphasis on, then we can't help but find it dubious.

    Serious disparities have been brought to the fore by the coronavirus crisis. The role of politics is to support people in hardship, but the agreement on the handouts leaves their purpose vague.

    The first issue is that these distributions were made applicable to people in households where some financial leeway still exists.

    Ruling coalition junior partner Komeito vowed in its House of Representatives election pledges to seek a "uniform subsidy." Fearing criticism of pork-barreling, the ruling Liberal Democratic Party (LDP) reached an agreement with Komeito to include a system with income-based limits.

    But only households that earn 9.6 million yen ($84,000) or more per annum are exempt from the subsidies. Some 90% of those aged 18 and under will receive the handouts, and it seems as if Komeito's original plan was effectively almost entirely accepted.

    These handouts are insufficient as a form of childrearing support.

    Komeito has maintained that it is "necessary for raising children across all of society." If that is the case, the measures shouldn't end with a temporary handout. They also need to include long-term support in the form of expanded child benefits.

    Among the ruling parties, there apparently are aims to revitalize consumer spending made sluggish by the coronavirus crisis. But some have asserted that households with money to spare will simply put the handouts into their savings, thereby making the effect of the distributed money minimal.

    At the same time, support is lacking for people without children who are struggling to make a living.

    The ruling parties have also agreed to give a separate 100,000 yen to households with low incomes, regardless as to whether they have children. This is based on LDP election pledges.

    But these handouts are subject only to households that are exempt from residence tax due to low incomes. A couple living in one of Tokyo's 23 special wards would need to have an annual income of 1.56 million yen (about $13,700) or lower to receive such handouts. Earners of low incomes of under 2 million yen (about $17,500) would not receive the benefits if their income exceeds the yardstick amount.

    The timing of all these subsidies is late. By this summer, it was already clear that people's lives had been damaged by intermittent state of emergency declarations. The delay in distributing support is an issue unchanged since last year.

    At the root of this problem is the ruling parties' irresponsible stance of forcing a unified version of their differing policy pledges. Although it was a juncture that tested Prime Minister Kishida's leadership abilities, it ended with him rubber-stamping the agreement.

    Total funds for the handouts appear to have reached 1.8 trillion yen (about $15.76 billion). The funds are largely dependent on government bonds. If these funds are not used for fair distribution, the burden on future generations will be made greater.

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