That the Osaka-based school operator withdrew its application to open a new elementary school on a tract of land purchased from the national government at a questionable discount does not end the controversy over the land deal. The government still needs to clarify how the land plot in Toyonaka, Osaka Prefecture, had been sold to Moritomo Gakuen at a fraction of its appraisal value and whether there was any political meddling in the deal between the operator and the Finance Ministry.

Yasunori Kagoike, president of Moritomo Gakuen, denied that the school operator had been given any political favors in winning a contract for purchase of the 8,770 sq.-meter government-owned plot of land at ¥134 million, or a mere 14 percent of the appraisal value of ¥956 million, when he announced the withdrawal of his application with the Osaka Prefecture last week to open the new school in April. He denied that Prime Minister Shinzo Abe — after whom he reportedly attempted earlier to name the school in soliciting donations for the school project — or his wife Akie — who had until recently been listed as "honorary principal" of the planned school — had done any favors for him.

Now that the school plan has been canceled, the Finance Ministry, in accordance with the terms of the contact, has demanded that the operator return the land to the government after dismantling the school building and restoring the plot to its original condition, in exchange for a refund of the installment payments that had already been paid to the government for its purchase. The land ministry also plans to urge Moritomo Gakuen to repay ¥56 million in subsidies that had been paid under the program to promote the construction of wooden buildings. However, settling the financial matters will not end the suspicions over the land deal itself.