CABINET PUBLIC RELATIONS SECRETARY: We will now begin the press conference by Prime Minister Naoto Kan. Prime Minister, your opening statement please.

Opening Statement by Prime Minister Naoto Kan

PRIME MINISTER KAN: Tomorrow marks two months since the Great East Japan Earthquake. I have heard that as many as 80,000 people participated in volunteer activities in the areas affected by the disaster over the 10-day Golden Week holiday period. I would like to express my heartfelt respect to each and every one of these volunteers.

Over the holiday period, I myself visited shelter for the residents of Futaba Town in Fukushima Prefecture, who have evacuated from their homes due to the nuclear incident. During this visit, many people told me that they want to go back to their old lives. I also heard many harsh criticisms of the response made by the Government. This experience inspired me with a renewed desire to work even harder to help these people return to their former lives as quickly as possible, if even only one day sooner.

During Golden Week I also visited a store in Yaesu here in Tokyo that sells the products of Fukushima Prefecture. I purchased sake, rice, vegetables, and miso paste.

Shortly after my visit to that store, I was able to have a conversation with a group of people who are using the internet to sell vegetables and other goods produced in the disaster-affected region. The internet provides an excellent method of support for those who want to help but cannot go to the area as volunteers or those who have sent relief goods, want to do more, and donft know what they can do, in that through the internet people can purchase the products of the affected areas. It is a method that allows anyone, no matter where they live, to cooperate with recovery efforts, and, as I learned during the meeting, it is a method that many people are currently making use of.

And people are not just making purchases over the internet - they are also communicating with those living in the disaster-affected region. I learned during the meeting about how the internet is facilitating ever-greater connections between individuals. I expect that more and more people will participate in activities like this, and that these activities will continue to widen the disaster-affected regionfs network of support.

Turning to other matters, on May 2 we established the first supplementary budget, having received the unanimous approval of the Diet members of each party. Although we must continue to further strengthen our recovery efforts, at the same time we must now begin to take the first steps toward reconstruction. We shall first pass the Basic Act on Reconstruction, and then in order to create a system to implement this Act, we shall amend the Cabinet Law. It is my hope that we will be able to decide on our policies for these two pieces of legislation within the Cabinet and submit bills to the Diet before the weekfs end. I want to put the full force of the Government behind the establishment of these bills, and I want to do so while listening to each opinion offered by opposition parties.

Moving on, I am extremely pleased and grateful to be able to say that Chubu Electric Power Company has quickly accepted my request regarding the suspension of operations at Hamaoka Nuclear Power Station. However, this move has given many causes for concern over possible power supply shortages. This is something that I have been discussing with Minister for Economy, Trade and Industry Banri Kaieda since before I issued my request. I believe that with the cooperation of other power companies as well as businesses and individuals, we can avoid power shortages moving forward. I ask tonight that everyone provide us with such cooperation.

As I stated in my last press conference, the reason behind my decision to request the suspension of operations at the Station was a consideration for the safety and well-being of the people. I also considered the extremely large effect that a disaster in Hamaoka would have on the economy of Japan if the worst case scenario should come to pass. Although the suspension of Station operations will mean a lot of hard work for those it directly affects, I believe that this is necessary in order to protect the safety and well-being of the public.

While I am on the topic of the recent nuclear incident, we are now proceeding with preparations for the inauguration of a Nuclear Incident Investigation Commission. The formation of this Commission will be based on three basic ideas.

First, the Commission should be independent of all currently existing nuclear authorities. In other words, it will be a body formed around those with no previous affiliation to such organizations; those who can make independent judgements.

Second, the Commission should be open to the public and the international community. Its discussions should be truly transparent.

Third, we believe that the discussions of this Commission must be comprehensive, which is to say that the Commission should not just discuss technical issues - it should consider the systems and past organizational structures we had in place and how they affected the incident this time. We need a comprehensive consideration of issues like these as well.

Independence, transparency, and comprehensiveness: these are the three principles around which we are preparing the formulation of the Nuclear Incident Investigation Commission.

At the same time as we work to establish this organization, we are also moving forward with the creation of a scheme by which to pay out compensation for the nuclear incident. As I have said time and time again, Tokyo Electric Power Company (TEPCO) should bear the primary responsibility for the payment of such compensation. However, I want the Government to also actively shoulder a portion of this responsibility in order to ensure that each affected person receives an appropriate amount of money.

In light of the current issues we face, there has recently been a lot of debate about what Japanfs energy policy should look like in the future. In terms of nuclear power, first and foremost, it is vital that we ensure public safety. Up until now, nuclear power and fossil fuels have been the two pillars of our energy supply. However, in consideration of both the recent nuclear incident and the issue of global warming, I believe that two other pillars are now also vital for us. The first of these is renewable and natural energy sources such as solar, wind and biomass power. We will add these to our core energy sources. This is my first proposal.

The second pillar I want to propose is energy conservation. We must ask ourselves if it is acceptable for us to continue consuming so much energy. I propose that we must work to create a nation which conserves energy through innovative activities or by making different choices regarding how we structure our society. I believe that energy conservation should become yet another pillar of Japanfs energy policy.

As we move forward, we must exert even greater efforts than we have in the past on this issue. We must work to ensure the safety of our nuclear power stations. We must reduce the amount of CO2 emissions caused by the use of fossil fuels. And as we do this, we must establish natural energies and energy conservation as two new pillars of our national energy policy. I hope to move forward with debate on the overall reviews of our policy with these concepts in mind.

Before I conclude, I want to say that while the direct cause of the nuclear incident this time was the earthquake and subsequent tsunami, the major responsibility for having been unable to prevent this incident lies with the operator of the power station, TEPCO, and those of us in the Government who have enforced Japanfs nuclear policy up until now. I want to express my sincere apologies to the nation for having been unable to prevent this incident. I am truly sorry.

I understand the responsibility I bear for this, and with this in mind, I shall be returning my annual salary as Prime Minister to the nation until the incident at the nuclear power station has been brought under control. I plan to begin doing this from June.

This concludes my report today on the issue of nuclear power and the way forward for recovery and reconstruction efforts.

Q&As

CABINET PUBLIC RELATIONS SECRETARY: We will now move on to the Q&A session. Although I will be calling on you to ask questions, we would appreciate it if you would still state your name and affiliation. Thank you. Yamaguchi-san, please.

REPORTER: I am Yamaguchi of NHK. In the two months since the disaster, the first supplementary budget has been approved and you are now speaking of commencing full-fledged recovery efforts. Meanwhile, at a recent meeting between the heads of the Liberal Democratic Party (LDP) and the New Komeito Party today, it was said that the second supplementary budget should be submitted to the Diet soon. Do you plan on submitting the second supplementary budget during the current Diet session, which is nearing its close, or do you intend to end the current Diet session and then call for deliberations on the second supplementary budget by opening an extraordinary session?

PRIME MINISTER KAN: The first supplementary budget is quite large - more than four trillion yen - and should therefore be enough to cover a significant portion of the financial resources needed for recovery efforts. The Reconstruction Design Council is currently discussing how to proceed with reconstruction moving forward. We will consider such issues as how much financing will be necessary to implement their proposals when the time comes to do so.

In that respect, our first step will be to actively push forward the recover work currently underway. We have yet to decide on an appropriate time to submit the second supplementary budget, which will help to facilitate reconstruction.

CABINET PUBLIC RELATIONS SECRETARY: Yes, next please, Arimoto-san.

REPORTER: I am Arimoto of the Nishinippon Shimbun. I would like to ask about the Governmentfs policy on nuclear power stations. You stated that Hamaoka Nuclear Power Station, which you had requested for shutdown, is a special case. On the other hand, the probability of an earthquake occurring in Fukushima was extremely low, yet it happened nonetheless and we now face the consequences. There are many nuclear power stations that neighbor fault zones and the public is still very concerned over the safety of each of these facilities. How do you plan to gain local understanding as you undergo the process of revising Japanfs overall nuclear power policy, including safety standards? Are you planning on requesting that operations at other stations as well be suspended or that their recommencement be postponed?

Also, concerning the incorporation of natural energy sources as one pillar of national energy policy, which you mentioned earlier, is it correct to understand your statement to mean that the Government plans to decrease Japanfs reliance on nuclear power in the future?

PRIME MINISTER KAN: Allow me to first respond to your question concerning other nuclear power stations - as I have said in the past, the reason that I requested the suspension of operations at Hamaoka Nuclear Power Station is because an evaluation by the Headquarters for Earthquake Research Promotion of the Ministry of Education, Culture, Sports, Science and Technology (MEXT) indicated that there is an extremely high possibility - an 87% chance to be exact - of a major earthquake of around magnitude 8 occurring within the next 30 years. That is why I requested that operations be suspended. There are of course various different possibilities regarding other nuclear power stations as well, but at the very least, forecasts provided by earthquake research centers have not reported a situation as urgent as the one surrounding Hamaoka Nuclear Power Station. That is why I requested the suspension of operations at that station.

Concerning your other question on energy - or on what the position of nuclear power is - the current Basic Energy Plan stipulates that Japan aims to have nuclear power account for more than 50%, and reusable energy account for 20%, of the power we consume by 2030. However, due to the major incident that occurred in Fukushima, we must dismiss the current Basic Energy Plan and start discussions over from a clean slate.

In the process of doing so, we will work to ensure an enhanced level of safety for nuclear power, while at the same time more vigorously promoting natural and reusable energy. I believe that this is the direction we must follow, and I intend to advance discussions with these points in mind.

CABINET PUBLIC RELATIONS SECRETARY: Could we have Tanaka-san next, please?

REPORTER: I am Tanaka of the Mainichi Shimbun. I have a question about TEPCOfs cost-reduction measures. Today, TEPCO made a proposal for certain restructuring measures to Chief Cabinet Secretary Edano and Minister Kaieda, including a complete reduction of remuneration for executive officers with voting authority. Do you feel that their offer is adequate? Do you think the company should do more?

Secondly, you mentioned earlier that you will be returning the annual salary you receive as Prime Minister. Does this mean that you will continue to receive a salary equivalent to that of a member of the Diet? Could you provide clarification on that point please?

Finally, will you also be calling on other Cabinet ministers to give up their annual salaries as well?

PRIME MINISTER KAN: First, I have heard that TEPCO is exerting the greatest efforts possible to provide compensation for those that have been affected by the incident. These efforts include the liquidation of various assets, a further reduction in headcount to streamline the company as much as possible, and the salary reductions that you just mentioned. I am aware of their efforts, and I accept that the proposals that TEPCO offered today are one part of such efforts. As to whether these efforts are sufficient, we will need to review and consider that in future discussions. I understand that TEPCO is also of the same stance on this.

Next, with regard to my decision to return my annual salary as Prime Minister, as you have just pointed out, Ministers who are also members of the Diet receive salaries corresponding to their ministerial posts on top of their salaries as members of the Diet; this is the case for me as well, we do not receive two separate salaries. On my part, like other members of the Diet, I have already given up a portion of my salary in my position as a general member of the Diet. I would like to retain the rest of salary as a member of the Diet in the same way as other Diet members. However, I plan to give up all the additional allowances that I receive as Prime Minister, both the monthly allowances and bonuses.

As far as the other Cabinet ministers, I have not actually previously said anything in particular to them about this, and in any case, there is no doubt that the Prime Minister shoulders the heaviest responsibility under circumstances such as these. I have touched on this subject before while talking to Minister Kaieda, and I believe he will make a decision based on his own judgment. I have not spoken to any of the other Ministers about this particular topic.

CABINET PUBLIC RELATIONS SECRETARY: Letfs hear from the next person. Mizushima-san, please go ahead.

REPORTER: Prime Minister, thank you for taking my question. Regarding the approach to some of the key bills from the final portion of the Diet session, for example, a special measure was implemented to extend tax reductions, but I think this will expire before long. Furthermore, the establishment of a special bond bill to issue deficit-covering government bonds seems to no longer be on the horizon either. Will the current Diet session be extended in order to establish legislation like this? Or rather, do you think another option will be possible? Please tell us what you think.

PRIME MINISTER KAN: There is consensus on this issue among the Policy Research Council chairmen of the three parties, and so I hope to move forward with this in some way, at as early a stage as possible, based on a tripartite agreement.

However, at the current stage, we still do not know whether or not that will be possible. A range of consultations are underway on this, including with the Committee of the National Diet and the Secretary General of the Democratic Party of Japan (DPJ). At the present time, we are exerting every effort to make progress on this during the current Diet session.

CABINET PUBLIC RELATIONS SECRETARY: Next question please. Egawa-san, please go ahead.

REPORTER: I am freelance reporter, Egawa. Just now you used the words grecoveryh and greconstruction,h but looking at the situation at the nuclear power station and how it has affected those residing in the surrounding area, it doesnft seem like conditions are such that they can even begin such recovery or reconstruction efforts yet. Being unable to make decisions about what to do over even the coming months, these people are grappling with great instability in their lives. I have heard people say that TEPCOfs provisional payments of one million yen will be gone due to the loans payments. At the same time, those in temporary housing will have to pay living expenses by themselves, but they have no income. The Government has spoken of compensation, but we have no idea when this will be given. It is issues like this that the people are unanimously complaining about.

I would like to ask whether a decision will be made soon on a method to ensure month-to-month support for evacuees. I feel there are various possibilities for this, for example, it could take the form of advance compensation payments.

PRIME MINISTER KAN: As I said earlier, I recently visited Kazo City in Saitama Prefecture, where there are a fairly large number of people who have been displaced by the nuclear incident. A range of serious efforts are being made to support them, including by the Governor of Saitama Prefecture and the Mayor of Kazo City. Employment guidance and other types of assistance are available to them. For example, in the evacuation center, which used to be a high school, HelloWork service providers have set up workspaces in some of the corridors.

Whenever I talk to people in evacuation centers, the comment I hear most frequently is of course that they want to return home as soon as possible. But answering that is no easy task. They want to know what the prospect is of being able to go home, what they can do otherwise and when they can do it. I think that without knowing such information, even if an individual finds new employment or considers leaving their evacuation shelter and moving into one of the many public housing units available to them, it is difficult for them to decide what to do. This has been frequently pointed out to me.

In that sense, it has now been two months since the earthquake, and we need to see the establishment of some sort of light at the end of the tunnel. This might come in the form of progress by TEPCO on their roadmap or further work toward recovery. If an endpoint for the problem can be established - that is, once we are able to say that there will be absolutely no further release of radioactive materials and that a cold shutdown has been achieved - from then onward those in evacuation shelters will be able to establish their own future goals. This is something I have stated before.

Regarding the issues of livelihoods and work, the Government is expending every effort to help people lead dignified lives and establish prospects for the next step. I hope to continue to make the maximum possible efforts to this end.

CABINET PUBLIC RELATIONS SECRETARY: Next we would like to call on a member of the foreign press. The person with their hand up, please.

REPORTER: I am Yamaguchi of the Associated Press. There is a great deal of international interest in how Japan will bring the incident at Fukushima Daiichi Nuclear Power Station under control and how the incident will impact Japanfs energy policy going forward. The G8 Summit will be held in the near future and there are also other international meetings scheduled such as the Japan-China-ROK Trilateral Summit. Could you say something about how you intend to explain the situation surrounding the incident at Fukushima and the future outlook for Japanfs energy policy, including whether or not the Government intends to move away from a nuclear power-oriented policy, at these international meetings?

PRIME MINISTER KAN: As you rightly mention, the Japan-China-ROK Trilateral Summit will be held on May 21, and the G8 Summit will be held in France on May 26 and 27.

In addition, the schedule for the International Atomic Energy Agency (IAEA) International Ministerial Conference on Nuclear Safety has now been confirmed for June and Japan must also submit a report for that meeting.

Your question concerned the Governmentfs thoughts regarding energy policy towards the future, and firstly, with regard to nuclear power, I would say that we will implement a thorough investigation into the recent situation and diligently aim to identify ways in which nuclear power can be made safer. This is one of the major pillars of government policy that I will be explaining in international meetings.

In order to achieve this aim, Japan will naturally continue to make efforts and has to date provided the international community with various data relating to the details and content of the incident at the nuclear power station, and will make further efforts to provide this information. It is the wish of the Government that this information would be of use to the international community in ensuring a safer supply of nuclear energy in the future.

In addition, as I have mentioned earlier, many countries in Europe and North America are focusing efforts on wind and solar energy, in addition to nuclear power and fossil fuels. Japan is lagging somewhat behind in this field and we will make further efforts in this regard. It is these concepts and the stance of the Government that I would like to present to the international community.

CABINET PUBLIC RELATIONS SECRETARY: Next, Matsuyama-san, please.

REPORTER: I have a question regarding the request to halt operations at Hamaoka Nuclear Power Station. There have been criticisms made that the announcement was extremely sudden and that the government is seeking to restrain corporate activities without legal basis. Among these, Chairman of Nippon Keidanren, Mr. Hiromasa Yonekura, has been particularly vocal in his criticism, having stated that the decision came out of the blue and that the thought processes behind the decision were like a gblack box.h

Could you explain again why such a sudden announcement was made concerning this important decision, which could impact the future of Japanfs nuclear policy?

In addition, although Chubu Electric Power has indicated that it will accept the request to halt operations, it is requesting that the Government provide assistance to cover cost increases and other matters. Could you tell us if it is the Governmentfs intention to provide financial assistance to cover the cost increases that will be incurred by Chubu Electric Power?

PRIME MINISTER KAN: It has been previously pointed out that Hamaoka Nuclear Power Station lies on an active fault. However, it goes without saying that the recent events following the disaster of March 11 have had a significant and direct impact on the decision to issue the request, given the fact that prior to the disaster, it is said that Fukushima Daiichi Nuclear Power Station operated by TEPCO was disaster-proof, only for the cooling functions to be lost following the disaster, which led to this serious incident.

Given this situation, the Cabinet convened a number of meetings, including the Disaster Prevention Council, where discussions covered the possibility of earthquakes in various other locations and I confirmed once again the figure of 87%. This prompted questions about how to respond to this issue and I sought the opinions of various persons.

Minister of Economy, Trade and Industry Kaieda also received a number of views and opinions and in the final instance we exchanged these views and information, and after a process of careful deliberation we reached the conclusion that making such a request would be necessary in the interests of public safety and security.

REPORTER: What are your intentions with regard to the provision of financial assistance to Chubu Electric Power?

PRIME MINISTER KAN: That will be a matter for consultation from now, but speaking in general terms the Government will need to cooperate as much as possible. With regard to what specific form this cooperation will take and how cost increases will be handled will be a matter for future discussion.

CABINET PUBLIC RELATIONS SECRETARY: Since wefre running over our scheduled time, this will be the last question. Sakajiri-san, please.

REPORTER: I am Sakajiri of the Asahi Shimbun. Allow me to confirm something about the Nuclear Incident Investigation Commission which you touched on in your opening statement. As you also said in your response just now, although you had stated that inquiries must be made into the nuclear incident, the request to shut down the Hamaoka Nuclear Power Station was made even before the inquiries were made.

In that case, will the activities of the Nuclear Incident Investigation Commission be limited to identifying the cause of the incident at the Fukushima Daiichi Nuclear Power Station? Or depending on the findings, do you also foresee taking further steps, such as reviewing the future nuclear energy policy or making additional shutdown requests? May I ask which of these two it is?

PRIME MINISTER KAN: As I stated a moment ago, the Investigation Commission we are working to set up will be based on the principles of independence, transparency, and comprehensiveness. The committee shall thoroughly investigate not only the technical problems but also institutional problems and so forth as they relate to the underlying cause of the incident.

As to where we go from there, I believe once the Investigation Commission comes out with a report, discussions will need to be carried out in light of that. As of now, I do not foresee the Investigation Commission going so far as to issue any sort of conclusion or vision. At first, I believe the committeefs functions will be limited to carrying out a thorough investigation of the incident at TEPCOfs nuclear power stations in Fukushima and the underlying factors which led to it.

CABINET PUBLIC RELATIONS SECRETARY: This brings the Prime Ministerfs press conference to a close. Thank you very much for your cooperation.