The principle of local autonomy is an important pillar of Japan's political system. It was introduced under the postwar Constitution — Chapter VIII deals with "local self-government." Following several rounds of reforms, the national and local governments are equal partners de jure. In practice, however, autonomous powers of prefectures and municipalities remain insufficient. The national government should continue efforts to help local authorities secure a more solid foundation in terms of power and finance so they can better serve the needs of local residents, communities and economies.

The Local Autonomy Law took effect on the same day as the Constitution — May 3, 1947. The Diet in 1993 adopted a resolution promoting local autonomy. A law that abolished administrative duties the state was supposed to fulfill but instead imposed on prefectures and municipalities was enforced in 2000. Subsequent reforms introduced from 2011 to 2014 transferred more power from the national to local governments.

Still, the national government continues to intervene in the operation of local governments through "notifications" and "requests." It also has the upper hand in budgetary matters, including in the distribution of tied and untied grants from state coffers. A new type of grant created under the Abe administration's regional revitalization strategy is reportedly unpopular with local governments because they must create plans for regional revitalization that conform to the rules set by the state, and are able to get the funding only after the plans are examined and approved by the state — in a structure that's reminiscent of the system where state authorities retain superiority.