Prime Minister Junichiro Koizumi's key policy-guiding panel will recommend nearly halving the ratio of payroll costs of national public servants to gross domestic product over the next 10 years from the current 1.7 percent, sources said Tuesday.
The payroll costs are currently 8.6 trillion yen for about 948,000 public servants, including Japan Post employees.
Council on Economic and Fiscal Policy, which has drawn up the draft basic policy for the payroll cuts, also wants the government to reduce the 687,000-strong national public servant workforce, excluding Japan Post workers, by at least 5 percent, or 34,300 people, over the next five years, the sources said.
Japan Post is not included in that figure as it will be privatized over a 10-year period starting in October 2007.
The draft policy will be presented by private-sector council members at the panel's meeting Wednesday and the group is expected to formally adopt it by the end of November.
To help the government make the spending cuts, the panel will recommend consolidating ministry branch offices, and streamlining the work of some government agencies, including agriculture and forestry statistics, and food control, the sources said.