OSAKA -- The Osaka Prefectural Government announced a 3.8 trillion yen budget plan Tuesday for fiscal 2001 that will reduce personnel costs for the third consecutive year.
Despite cutback efforts that will include reducing personnel by around 600 during the fiscal year, the size of the general account will exceed 3 trillion yen for the first time at 3.15 trillion yen.
One reason for the expanded budget was increased repayments of prefectural bonds, which have been estimated at a record 341 billion yen for fiscal 2001. A prefectural official said the scale of these payments will continue to increase in coming years as the prefectural government has already issued local bonds worth more than 4 trillion yen.
Tax revenue for fiscal 2001 is expected to be 1.24 trillion yen, up 3 percent from the initial forecast for fiscal 2000, prefectural officials said. Tax revenues for fiscal 2000 have slightly improved from the previous year by 41.7 billion yen, reaching 1.2 trillion yen.
In addition to 290 billion yen in subsidies from the central government, the budget will also rely on 314 billion yen in prefectural bonds to cover a 500 billion yen revenue shortfall as well as 97 billion yen from the prefecture's amortization fund.
According to calculations made by prefectural officials, the local government's revenue shortfall will reach 80 billion yen in 2007 if no remedies are implemented as the fund will run out by that time. This is well above the 64 billion yen level that would enable fiscal intervention by the central government.