The Finance Ministry was set to propose a fiscal 2004 budget draft Saturday totaling 82.11 trillion yen, up 0.4 percent from the initial fiscal 2003 budget, according to a copy of the draft obtained Friday by Kyodo News.
The budget increase was attributed to ballooning social security costs.
General expenditures, which form the core of the general account and finance policy projects, total 47.63 trillion yen, up 0.1 percent from the initial budget for the current fiscal year.
The Finance Ministry budget blueprint provides a rigid framework for government spending over fiscal 2004.
Although upward pressure on spending and dwindling tax revenue had fueled speculation earlier this year that the amount of fresh bond issues could overtake that of tax revenues for the first time, the draft shows that this scenario has been avoided.
Tax revenue is expected to fall 0.1 percent from fiscal 2003, hitting 41.75 trillion yen.
The draft calls for the issuance of 36.59 trillion yen in fresh government bonds, a record high for an initial budget, up 0.4 percent from the record 36.45 trillion yen set in fiscal 2003.
This brings the ratio of bond issuance to the total budget to 44.6 percent, matching the record high set in fiscal 2003.