The Kan Cabinet has adopted a ¥5.05 trillion spending package to help the economy overcome persistent deflation and the yen's recent rise in value against the U.S. dollar. It will submit a supplementary budget consisting of the package to the Diet by the end of this month, with the hope of getting it enacted by early December.
The government expanded the size of the package from an initial plan to spend some ¥4.8 trillion. People are seriously worried that economic conditions may rapidly deteriorate. The ruling and opposition camps, if they have a sense of crisis, should make efforts to pass the supplementary budget without delay.
The package focuses on five areas: job creation and human resources development (some ¥300 billion), economic growth in promising industries (some ¥300 billion), medical and nursing care services, support for child-rearing and other social welfare measures (some ¥1.1 trillion), revitalization of regional economies and support for small and midsize enterprises (some ¥3.1 trillion) and deregulation. In addition, public-works spending worth some ¥200 billion will be front-loaded.