Still no clear idea of Japan`s medium-term fiscal targets: Kan

TOKYO, Jan. 14 Kyodo -
Finance Minister Naoto Kan said Thursday he has no clear idea yet on how to set
medium-term numerical targets to restore Japan's worsening fiscal health, due
to uncertainties in the economic environment in the months ahead.
''We have to first see whether we will be able to achieve our targeted growth''
in the near term, Kan said in a group interview at the ministry.
Kan, who became finance minister last week, said it would be difficult to come
up with specific numerical targets before having more reliable projections for
Japan's growth and tax revenues, although the government has promised to map
out medium-term fiscal objectives by around June.
''If we just say what we want to do in terms of numbers, I think we will repeat
the same mistake'' made by the predecessors of the now Democratic Party of
Japan-led government, Kan said.
Kan said the long-ruling Liberal Democratic Party came up with a range of
targets for growth and fiscal restoration, but it ''could not achieve all of
them.''
He said the government, formed last September, needs to identify why previous
governments could not meet their targets.
To tackle the nation's ballooning debt, by far the worst among industrialized
countries, the government at the same time needs to make more efforts to cut
wasteful spending and create new sources of growth, not just working on
numerical targets.
Kan, also deputy prime minister, said Prime Minister Yukio Hatoyama's Cabinet
to a certain degree successfully managed to shift the focus of public spending
from large public works projects to social welfare and other programs more
closely related to people's daily lives, when it crafted the budget for the
year starting in April.
But the 63-year-old minister said wasteful spending must be trimmed further
this year. He said it is critical to thoroughly review the nation's special
accounts before central government offices make budgetary requests for fiscal
2011 around late August.
To avoid Japan's economy slipping back into a serious slump, he said the most
important thing for the government will be to pass the drafts of the second
extra budget for this fiscal year and the fiscal 2010 budget in the 150-day
Diet session starting next week.
Kan said DPJ Secretary General Ichiro Ozawa's money scandal will not have any
major impact on passing the budget bills through the Diet because he believes
opposition parties and the public are aware that passing the bills soon is
important to support the economy.
On Japan Airlines Corp.'s rehabilitation, Kan said it was ''the best choice''
of the government to ask Kazuo Inamori, founder of Kyocera Corp., to head the
struggling airline as chief executive officer.
Kan said JAL's reconstruction will be certain under Inamori's leadership,
adding that more consensus has been formed than before between concerned
parties on how to rebuild the debt-ridden carrier.
Kan, who has been trying to improve Japan's bureaucracy, also said he will
review the current personnel system at the ministry.
He suggested not only shifting the current system to more merit-based, but also
that senior posts at the ministry should more be open to the private sector or
former government officials.
Kan said Japan's bureaucracy could be transformed for the better by changing
the way in which Finance Ministry officials do their jobs.
Kan agreed to double as the finance minister on Jan. 6 and replaced 77-year-old
Hirohisa Fujii, who resigned for health reasons, the following day.
==Kyodo