Katayama on DOGE Review and Regional Banks
Overview
Finance Minister and Minister of State for Financial Services Katayama said she explained to Prime Minister Takaichi the policy of strengthening and deepening Japan's DOGE initiative and reviewing funds and subsidies in light of their policy objectives, and received her approval. The government will present specific directions at the October 9 meeting and advance policy prioritization and rules for fund management through the budget process and tax reform. There are about 200 funds, with an estimated balance of about 7 trillion yen at the end of the next fiscal year, but no individual targets have been set. Katayama declined to comment on reports of a management integration involving three regional banks and expressed a stance of encouraging management reform at regional banks.
Key points
- Japan's DOGE initiative will be strengthened and deepened, with specific directions for the review to be presented at the October 9 meeting.
- There are about 200 funds, with an estimated balance of about 7 trillion yen at the end of the next fiscal year. No individual monetary targets have been set.
- She declined to comment on reports of a management integration involving three regional banks and said, in general terms, that she would encourage management reform at regional banks.
Overview
At a press conference after a Cabinet meeting, Finance Minister and Minister of State for Financial Services Katayama was asked about Japan's DOGE initiative reviewing funds and subsidies, and reports that three regional banks in Aomori, Iwate, and Akita were discussing management integration.
The minister said she had explained the previous day to Prime Minister Takaichi how to proceed with Japan's DOGE initiative and received full approval for a policy of visibly strengthening and deepening its efforts.
Details
The Meeting of Relevant Ministers and Others and Vice-Ministers on the Review of Special Taxation Measures and Subsidies will be held on October 9 to set out the direction of the review. Thereafter, government ministries and agencies will align their views during the budget process and tax reform, revisit policy priorities, and concentrate resources on priority measures.
The review will eliminate overlaps in light of policy objectives and consolidate and integrate programs to make the social implementation of technology more efficient. For funds, the policy is to ensure predictability through an appropriate combination of budget measures spanning multiple years while drawing down idle funds.
Based on decisions by the Administrative Reform Promotion Council, the government will establish rules for returning funds to the national treasury that prevent funds from remaining idle over the long term and take opportunity costs into account. During the budget process, it will develop concrete, effective mechanisms to improve the efficiency of fund use and maximize the impact of policy investment.
The minister declined to comment on discussions about management integration among three regional banks in Aomori, Iwate, and Akita, saying the banks had made no specific announcement. In general, she said it was important for regional banks facing a challenging business environment, including population decline, to fulfill their financial intermediation role and contribute to local economies. The Financial Services Agency will encourage management reform initiatives at regional banks, not limited to mergers or management integration.