Press Conference by Prime Minster Kishida

[Provisional translation]

There are now two days remaining in the 150-day long Diet session. In addition to looking back over this ordinary Diet session, I will speak about how I will run the administration going forward.
 
During this Diet session, recovering trust in politics became the biggest matter of concern, triggered by the issue of political funding within the Liberal Democratic Party (LDP).
 
I won my first election in 1993. The first issue I took up as a politician was participating in discussions on Heisei era political reforms. Right through to today, I have always resolutely worked to bring about political reform. The current problem is one I face as President of the Liberal Democratic Party, coming from that background. It was with a sense of determination that I established our party's Headquarters for Political Reform at the beginning of 2024. In the roughly half a year since then, the Headquarters has repeatedly laid out essential measures and urged the party to take needed actions. Although we did at times come up against obstacles, whenever we did, in the hope of making some headway, I took the decision to disband my party faction and attend sessions of the LDP Political Ethics Hearing Committee, among other efforts.
 
Beyond this, to address the major issues of increasing public trust in the political funding system and making the foundations of democracy more solid, we have not only fortified the accountability of politicians as a matter of course but also amended the Political Funds Control Law, including lowering the threshold for disclosing the names of purchasers of tickets to political fundraising parties and reforming policy activity expenses.
 
At the same time, I wish to express my sincere appreciation to each party and parliamentary group for earnestly discussing these matters despite the difficult work of striking a balance between the dual goals of, first, thoroughly preventing a recurrence while also expanding transparency in political funding, and second, ensuring that political funding, the infrastructure of democracy, can be secured appropriately.
 
The supplementary provisions of the law include issues needing further examination. These include bolstering the transparency of policy activity expenses and establishing a third-party body for inspections and audits. From now, we will move forward speedily on consultations regarding how to transition these into concrete form.
 
Political reform never ends. There are a multitude of issues, including with regard to the electoral system and how discussions should take place in the Diet. We will continue to hold active debates within the party as well as earnest discussions with each party and parliamentary group while we pursue unceasing reforms for the sake of the people and for preserving democracy.
 
Although it was political reform that attracted the attention of the press, during this Diet session we also made great strides forward in important policies, with all but one of the 62 bills submitted by the Government being enacted, including our bill to fundamentally reinforce our support for children and child-rearing and our amendment of the Basic Law on Food, Agriculture and Rural Areas, which serves as the constitution for agriculture. I thank everyone involved most sincerely.
 
The Government is making all-out efforts towards recovery and reconstruction from the 2024 Noto Peninsula Earthquake, with active discussions taking place in the Diet as well.
 
A range of challenging issues confront us in the affected area, including the demolition of houses and the recovery of water supply lines. What is necessary is not only budgetary measures along with responses implemented by individual ministries and agencies, but also a structure for accelerating reconstruction in which all of Japan's ministries and agencies work together as one team. In line with Ishikawa Prefecture's policy of "creative reconstruction," we will establish in the disaster-affected area of Noto a base for providing support from the national government that crosses boundaries between ministries in order for the Government to work in close cooperation with Noto's six municipalities to implement full-scale reconstruction of communities. We will newly form a Noto Creative Reconstruction Task Force, expanded to have over 100 people permanently stationed in it, which will kick off on July 1. We will do everything possible to provide well-tailored assistance that stays faithful to the concerns of the people in the disaster-stricken area.
 
Alongside this, keeping the next large-scale disaster firmly in mind, we will waste no time in coordinating a course forward with regard to further cultivating our health, medical, and welfare assistance; enhancing cooperation during initial responses and other actions taken by the Self-Defense Forces, firefighting services, police, and others; and reinforcing the Government's disaster response system, including the disaster management functions in the Cabinet Office. This may include amending laws.
 
Next, I will address the economy, prices, and wages, all of which are major concerns among the public.
 
The Japanese economy now faces a critical moment as to whether or not we are able to break free from the deflationary economy of low prices, low wages, and low growth that has enveloped Japan for 30 years and transition to a new growth-oriented economy. The signs of this transition are becoming clear.
 
First of all, consider wages. This year's annual spring wage bargaining negotiations brought about robust wage increases of over 5 percent. The fruits of this outcome will appear by degrees. Of the wage hikes negotiated in the spring bargaining round, 40 percent started appearing in workers' May pay packets; 60 percent had appeared by June. In July, 80 percent of those hikes will be reflected. As we head towards the autumn, the tangible feeling that wages have risen will gradually permeate society.
 
In addition, capital investment is now at the highest level in history, and corporate reforms are highly regarded by both domestic and international entities. Large-scale strategic investments from overseas are getting underway one after the other in semiconductors, storage batteries, data centers, and more. We will first make these signs of a transition into a major trend and then pursue multi-layered policies to ensure this continues in a steady manner.
 
In concrete terms, the fixed-amount tax reduction beginning in June will play a major role by underpinning a distinct feeling across society as a whole that income growth is surpassing price increases. We will mobilize antitrust laws and other means to thoroughly ensure that small- and medium-sized enterprises (SMEs) are able to pass along price increases into product prices. To ensure that wage increases penetrate the public sector, including in medical and nursing care, childcare services, public procurement, and so on, we will carry out comprehensive follow-ups, with the Government working as one. We will further expand various kinds of assistance for promoting SMEs' earning capacity and investment in green transformation (GX) and other areas.
 
At the same time, with price levels remaining high, the situation will continue to be extremely challenging for pensioner households and for SMEs that have been unsuccessful in passing price increases through to clients. What is necessary is well-tailored assistance for those in danger of being left behind as the economy transitions. Accordingly, we will adopt a two-tiered approach. The first tier is fast-acting measures that people can access immediately; the second tier is measures taken as one part of an economic package we aim to draw up in the autumn.
 
To start, as a first-tier measure, we will rapidly move to implement energy assistance, which will have a significant and immediate effect on regional economies and on low-income households. Our measures to curb drastic fluctuations in fuel prices will continue, but only within 2024.
 
We will provide subsidies to assist with electricity and natural gas fees for the three months of August, September, and October as emergency assistance for overcoming extreme heat, helping people ride out the oppressive heat and the sweltering summer. For the specific content of each of these measures, we will move quickly to coordinate with the ruling parties. We will consider our measures so that the effect of taking these steps until the end of 2024 will reduce consumer prices by a monthly average of more than 0.5 percentage points compared to not having any such measures in place.
 
Next, as a second-tier measure, we will undertake bold considerations targeting pensioner households and low-income earners, as well as regional economies. Specifically, we will examine providing additional benefits to pensioner households and low-income households struggling with the sharp rise in food costs within the higher cost of living.
 
Moreover, we will take up consideration of establishing well-tailored assistance that addresses soaring prices, utilizing expanded subsidies for local governments needing special support (temporary subsidies for revitalization) to address soaring prices. This broad-based assistance will help to reduce the burden on parents and guardians for school lunch fees and other expenses while also addressing sharp price increases affecting agriculture, forestry, and fisheries industry businesses, including dairy farming, which is impacted by spiraling feed prices. This assistance will also help to counter the sharp price increases affecting SMEs, medical and nursing care services, childcare services, school facilities, public baths, regional public transportation, physical distribution, and regional tourism industry entities.
 
Subsidies to offset the cost of gasoline, electricity, and natural gas go against the tide of decarbonization and are not something that we should continue indefinitely. But, as I said just now, we are considering the current situation of our regional economies and low-income households getting hit hard by price increases, so I have decided that this time only we will institute energy subsidies, which will have the most immediate effect.
 
One of the fundamental reasons why such steps are necessary is the vulnerability of Japan's energy structure. If we are to revitalize investment, promote domestic industries, and bring prosperity to people's daily lives in the future, we must overcome the vulnerabilities of Japan's energy structure and ensure we are self-sufficient in inexpensive and stable energy.
 
There is a gap of up to roughly 30 percent in the price of electricity between regions where the restart of nuclear power plants has been moving forward and regions where restarts have not progressed at all. In addition to swiftly restarting nuclear power plants whose safety has been confirmed, we will also promptly examine systems for ensuring strategic investments into the research, development, and implementation of small modular reactors (SMRs) and other next-generation advanced reactors, as well as into other decarbonized power sources, including hydrogen, Perovskite solar cells, and offshore wind power.
 
From now, we will work to formulate a national strategy that considers energy supply, industrial structure, and industrial location in an integrated manner, aiming to finalize the strategy within the calendar year.
 
In addition to the upcoming presidential election in the United States of America, both the UK and France are now set to have elections through next month. Uncertainty in international affairs, including the situations in Ukraine, the Middle East, and elsewhere, is becoming more pronounced. I will fully defend the peace Japan enjoys, as well as the lives and assets of the Japanese people. Towards that end, in addition to reinforcing our deterrence, I am working with a strong desire to hand down to the next generation no matter what the principles and fundamental values that must be upheld by all countries. After July, I will carry out an important diplomatic schedule, including the NATO Summit as well as the 10th Pacific Islands Leaders Meeting (PALM10), to which I will invite the leaders of Pacific island nations, and my first summit meeting with the leaders of five Central Asian countries. As I think through my preparations for a string of summit-level diplomatic occasions, including with the G20 (Summit on Financial Markets and the World Economy), ASEAN (Association of Southeast Asian Nations), and APEC (Asia-Pacific Economic Cooperation), I will maintain a high sense of vigilance as I work to cultivate our foreign and security policies.
 
Moreover, the abduction of Japanese nationals, an issue whose resolution has time constraints, is a human rights issue about which we cannot let our mindfulness dwindle for even a moment, as the families of the victims continue to age. I will continue to do my utmost to boldly tackle the issue to realize the return of all the abductees to Japan at the earliest possible date.
 
Finally, I will address amending the Constitution.
 
From my position as prime minister, I have refrained from commenting directly on the contents or the progress of discussions on amending the Constitution. However, speaking from my position as the president of the Liberal Democratic Party, I regard the recent agreement in principle by five parliamentary groups on the text of a draft proposal in the House of Representatives' Deliberative Council on the Constitution as an extremely important step forward. At the Party Leaders' Debate the day before yesterday, I proposed to the Constitutional Democratic Party of Japan (CDP) as well that we accelerate work to amend the Constitution, but I was unable to obtain the CDP's approval, which I find very regrettable. I very much hope to make even further progress beyond this important step just taken. The Constitution is the basic law that defines the foundation of the state. I wish to emphasize once again that there is a political responsibility to bring up to the Japanese people, in response to the demands of the times, the opportunity to consider constitutional reform.
 
I will end my opening statement here.