[Provisional Translation]

 

CABINET PUBLIC AFFAIRS SECRETARY: We will now begin the press conference by Prime Minister Yoshihiko Noda. Prime Minister, your opening statement please.

 

Opening Statement by Prime Minister Yoshihiko Noda

PRIME MINISTER NODA: At the outset, I would like to say a few words to the people of Japan and above all to the people of Okinawa Prefecture, concerning the recent remarks made by the former Director-General of the Okinawa Defense Bureau.

The remarks that have been reported are inappropriate in the extreme, and the person in question has accepted that there was some communication which couldn't be helped but was perceived as reported in the press. It is therefore natural that the person in question has been dismissed from his position. I would like to take this opportunity to reiterate my heartfelt apologies to the people of Okinawa, whose feelings have been so deeply hurt.

With regard to the Futenma Air Station, the basic stance of the Cabinet is to eliminate the dangers surrounding the air station as quickly as possible and reduce the burden on Okinawa, in accordance with the agreement between Japan and the United States. To that end, the Government's intention has been to make concerted efforts with all sincerity to gain the understanding of the people of Okinawa with regard to the Government's current policy. It is truly regrettable that this spirit of sincerity has not been thoroughly observed. Once again, I am determined to make every effort to reestablish the integrity of the Government as a whole and seek the understanding of the people of Okinawa.

Next, I would like to report to the people of Japan that we have been able to reach the milestone of the passage of the third supplementary budget and the bill to secure financial resources for reconstruction. Towards the recovery and reconstruction of the disaster-affected areas, thus far a total of approximately 6 trillion yen has been allocated in the formulation of the first and second supplementary budgets combined, in addition to which reserve funds have been mobilized in timely fashion on multiple occasions. In these ways the Government has focused its efforts on providing for the immediate needs of the disaster-affected areas. The third supplementary budget, amounting to in excess of 12 trillion yen and which incorporates expenses required for full-fledged reconstruction, was approved by the Diet on November 21. Yesterday, the bill to secure financial resources for reconstruction, which provides the legislative backing to the third supplementary budget, was also passed by the Diet. Following their passage, I am convinced that we can now significantly accelerate efforts to tackle the three priority challenges for the Cabinet, namely recovery and reconstruction from the Great East Japan Earthquake, bringing the nuclear power station accident to a conclusion, and rebuilding the Japanese economy. I would like to express my appreciation to all the members of the ruling and opposition parties, who were engaged in serious debate in the course of Diet deliberations, thus leading to the final approval of the Diet.

In terms of financial resources for reconstruction, from now we will also continue to make unceasing efforts to eliminate wastefulness in government as a whole, and secure non-tax revenues. Under this basic premise it has been decided that we must ask the people of Japan to bear some of the burden in such forms as a time-limited increase in income tax and corporation tax. The enormous sums required for reconstruction expenses are something that must be shared by all people living in the country. I reiterate my request for the understanding of the public concerning the concept that the burden of these resources should not be passed onto the next generation, but instead should be shared appropriately by all generations living here in the present.

With regard to recovery and reconstruction in the disaster-affected areas, we have worked untiringly to implement measures to date, resulting in the completion of the required number of temporary accommodation units, and also reducing the number of disaster-affected people residing in evacuation centers from more than 40,000 in June, to a little over 700 today. The removal of debris that lay strewn across residential areas and roads has almost been completed. Even including other debris and rubble that requires demolition, almost two-thirds of all such demolition and removal work has now been completed. It is expected that more than 80% of disaster-affected local governments will have reconstruction plans in place by the end of the year.

While on the one hand such progress is being witnessed, I am also aware that opinions are also being raised that efforts to date have been lacking due urgency and that assistance is not effectively reaching those who need it. With the harsh winter season drawing down on the disaster-affected regions, I am keenly aware of the need to do everything to accelerate measures further. One of the largest factors holding back disaster-affected local governments from the implementation of bold measures has been that the sources of financial backing for such measures remained unclear. I expect that with the passage of the third supplementary budget and the bill to secure financial resources for reconstruction this largest bottleneck will now be removed. Through the establishment of easy-to-use grants to disaster-stricken municipalities in excess of 1.5 trillion yen and the establishment of special tax grants for reconstruction in excess of 1.6 trillion yen, we have ensured that the actual financial burden on disaster-affected local governments is reduced to zero. The single biggest feature of the third supplementary budget is that it implements unprecedented, ground-breaking financial measures. Through such measures I believe that the path towards the realization of the reconstruction plans put forward by local governments has now been put on a sure footing.

In terms of the budget allocation required for large-scale decontamination operations and the disposal of radioactive materials, already approximately 460 billion yen has been secured. Furthermore, efforts are being made to increase this figure in the budget for fiscal 2012, with a view to securing total funds in excess of 1 trillion yen. Including the Self-Defense Forces, all ministries and agencies concerned are making concerted efforts to create robust structures for the implementation of decontamination operations, and the Government will make every effort to engage in such endeavors in order to allay the worries of the people of Fukushima and the entire nation. Furthermore, financial measures in excess of 500 billion yen have been put in place for such purposes as the establishment of an independent fund for the revitalization of Fukushima. This fund will drive efforts towards the realization of a project to create a future for Fukushima, including the development of an international medical center specializing in radiation treatment.

Unless we can rebuild the Japanese economy as a whole, which is currently suffering from the historic appreciation of the yen, it will not be possible to realize the early reconstruction of the disaster areas. As symbolized by the location subsidies amounting to 500 billion yen, approximately three times the cumulative amount of subsidy measures implemented to date, we have prepared never-before-seen scale of measures to counter the unprecedented crisis of the hollowing out of industry. Also through the enhancement of financing measures for small and medium enterprises and employment creation funds, we are demonstrating a firm stance towards the rebuilding of the Japanese economy and the sustainment of domestic employment.

The next responsibility of the Government is to ensure that the tremendous sums allocated under the third supplementary budget are executed without delay. I will take the lead and spur on all ministers, and ensure that the Government does everything in its power to see that the funds that local areas are waiting for are disbursed as soon as possible. In order to smoothly execute the supplementary budget, it is essential that various related legislation is passed by the Diet, including the draft bill for special zones for reconstruction, which will enable bold regulatory and taxation special measures such as measures that will exempt companies in disaster areas from paying corporate tax for a five-year period, and the draft bill for the establishment of the Reconstruction Agency, which will administer to the needs of the disaster-affected areas and serve as a "control tower" for reconstruction efforts. I would like to reiterate my request that deliberations on these draft bills be expedited in the Diet.

Given the pervading sense of uncertainty about the future of the economy in light of the appreciation of the yen, the floods in Thailand and the debt crisis in Europe, today, from the perspective of ensuring the security and safety of the people of Japan, I have given instructions to Minister of Finance Azumi to compile a fourth supplementary budget. The financial resources for this fourth supplementary budget will be covered by savings and reductions in spending and our policy is that no additional government bonds will be issued.

Today, the air outside felt particularly cold on the skin, and it has been a day during which we feel the coming of the end of the year. Today's low temperature in the coastal regions affected by the disaster is zero degrees. Tomorrow it is forecast that the temperature will drop below freezing. This reminds me anew of the harshness of the winters in the Tohoku region. Immediately following the disaster in March, the first items that the Government thought to provide to the region without delay were food, medical supplies and blankets to keep out the cold. By executing the third supplementary budget without delay, I would like to provide warmth to both mind and body for the people in the disaster areas, where the harsh winter has already begun. The Government will implement thorough measures to ensure that the prefabricated temporary accommodation units are sufficiently capable of keeping out the cold. Through local governments we are proceeding with the installation of heaters, and I hope that those people who have not yet received one will be able to receive one as soon as possible. As the cold starts to bite, it may be the case that people are reminded of painful memories or filled with sadness. The Government will also proceed with measures to ensure that the many elderly people among those affected are kept company and not left in isolation, and will also implement measures to safeguard mental health.

In relation to the reconstruction of the disaster-affected areas, I also have a request concerning the wide-area disposal of general debris created by the disaster. An urgent task is to utilize personnel and facilities from outside the disaster areas in order to dispose of the debris that has accumulated. Based on the basic premises of thorough information disclosure and confirmation of safety in accordance with due procedures, I request the understanding and cooperation of the people of Japan for their own local governments to take on the work of wide-area disposal. I hope that as people all living in the same country we can give form to the pure spirit of seeking to assist and support the disaster-affected areas. I am convinced that mutual assistance by fellow citizens in such a tangible form will be one thing that warms the hearts of those affected by the disaster.

From now towards the end of the year we must also address the various issues that faced Japan from before the disaster, taking discussions to the next level and clarifying a specific and concrete prescription. The greatest challenge is how to strengthen social security functions and ensure the future sustainability of social security by securing stable financial resources. To this end I am resolved to take the lead in driving forward discussions in the Government and among the ruling parties with a view to compiling an outline for the comprehensive reform of the social security and taxation systems by the end of the year.

This concludes my opening statement.

Q&As

CABINET PUBLIC AFFAIRS SECRETARY: We will now move on to the Q&A session. When you are called on, we would appreciate it if you would first state your name and affiliation. Mr. Sakajiri, please.

REPORTER: I am Sakajiri of the Asahi Shimbun. I have three questions with regard to the consumption tax increase that you mentioned near the end of your opening statement. First, discussion is underway within the party concerning the comprehensive reform of the social security and taxation systems, and there is talk that the administration plans to compile a broad outline for the reform. Meanwhile, however, in your remarks in the Diet - and also in your remarks in the party leaders' debate yesterday - you said that you will be compiling a "draft." Please explain whether what you are compiling is an outline or a draft, whether these are the same or different, and if they are different what sequence the process will follow. That is my first question. Now for my second question. What is going to be included in the draft or outline? With regard to the consumption tax increase, the direction is shown in the final draft for a comprehensive reform of the social security and taxation systems, so if you are going to make something new, will this include specifics concerning the timing and scale of the reforms, such as by what month in what year the current 5% consumption tax would be raised to "X" percent? My third question is with regard to your final comment that you are aiming to conclude the discussion within the year. Does this mean that, however delayed the discussions become, you will produce some degree of conclusion concerning the consumption tax increase by December 31 of this year? These are my three questions.

PRIME MINISTER NODA: First, with regard to your first question concerning the draft, a draft is a compilation of the ideas of the Government and ruling parties. That is the definition of a draft. I mentioned this in yesterday's party leaders' debate as well, but at such a stage the compilation of a draft is a compilation of the ideas of the Government and ruling parties, so we will then present that draft to the opposition parties and engage in a discussion on the details of the comprehensive reform of the social security and taxation systems. Following that discussion, ultimately an outline is compiled as legislation and then we begin preparations to submit a bill based on that outline. My impression is that this will be the sequence of things.

This was also mentioned in the Act on Responsibility to Restore Fiscal Health, which was once submitted to the Diet by the Liberal Democratic Party of Japan (LDP) following the House of Councillors election. The Government first compiles a draft and then considers the draft from the perspective of citizens, going beyond the scope of parliamentary groups, in order to form consensus. Taking this as an example, I intend to follow the same process. With regard to specific issues such as the timing and percentage of increase, I intend to exert every effort so that they are laid out in detail by the draft or outline stage. Discussions concerning those issues currently face various constraints in both the Government and ruling parties while the Diet is still in session, but ultimately as a target I intend to proceed with the compilation of a draft and outline in such a manner by the end of the year.

 

CABINET PUBLIC AFFAIRS SECRETARY: Next, Mr. Yamazaki.

REPORTER: This question is regarding an extension of the current Diet session. The current extraordinary Diet session is scheduled to conclude in a little more than a week, and yet there are still several important bills remaining. At the same time, and as you just said, the related legislation for the comprehensive reform of the social security and taxation systems must also be compiled by the end of the year. If that is the case, are you considering extending the Diet session in order to pass the other important bills, such as the bills concerning civil servants, the establishment of the Reconstruction Agency, and on postal reform? Or rather, on the other hand, do you intend to close the current Diet session without extending and allowing the important bills to pass because you want time to discuss the comprehensive reform of the social security and taxation systems within the party? Please tell us how you envision the proceeding.

PRIME MINISTER NODA: My basic stance is that the remaining bills that the Government has submitted basically be deliberated in a prompt manner and passed. We will continue to engage in efforts to ensure this happens, so at present we are not at a point where I can comment on an extension of the current Diet session.

 

CABINET PUBLIC AFFAIRS SECRETARY: Next, please. Yes, Mr. Matsuda.

REPORTER: With regard to the comprehensive reform that you just mentioned, you did not include any mention of the issue of the Trans-Pacific Partnership (TPP), which is something the public has a great interest in. Nevertheless, I see no steps being taken at the current stage to form a majority by reaching consensus within the party and involving the opposition parties in the Diet. It is the support and backing of the public that will allow you to make such steps visible and of course work to coordinate these vested interests. These types of matters are difficult to advance unless some type of national movement involving the public is created, an individual such as Mr. Toshio Doko from the times of administrative reform is sought out and positioned to lead such a movement, and some overarching movement is promoted that involves members of the public and that exceeds the conventional rules of the Diet. What are your thoughts on this?

PRIME MINISTER NODA: First, concerning the TPP, through diverse and copious discussion I have decided that we will enter into consultations with the countries concerned toward participating in the TPP negotiations. Moving forward, details such as what other countries demand of Japan will gradually become clearer during consultations with the countries concerned. The biggest criticism that I have received to date is that there is a lack of information. I intend to do a meticulous job of disclosing and providing such information, and holding thorough discussions with members of the public so that we can ultimately arrive at a conclusion that is appropriate from the perspective of national interests. I plan to use the so-called forum format to create venues in various places nationwide where discussion can be carried out. Your advice that a national movement and individuals like Mr. Toshio Doko are necessary is very positive indeed. With regard to the TPP, I intend to listen and respond to ideas such as those that you just mentioned while advancing, for instance, diplomatic negotiations, providing information, facing domestic opinion in a responsible manner, and strengthening structures in various ways.

Concerning the social security and taxation systems, as I mentioned earlier, full-fledged discussion concerning social security system reform and how to secure stable financial resources to support that reform - I believe that social security will be advanced first - will take place within the Government and the ruling parties. Also, and again as I mentioned earlier, while making calls for discussion in the opposition parties as well, I will work to implement publicity activities and provide explanations so that the people of Japan know as much as possible about what is being discussed.

 

CABINET PUBLIC AFFAIRS SECRETARY: Yes, Ms. Li.

REPORTER: I am Miao Li of Phoenix Satellite Television. This question is with regard to Japan-China relations. You previously mentioned that Japan-China relations must surpass the level of formality alone, and that a relationship must be developed that facilitates frank dialogue. Frankly, following the building of a mutually beneficial relationship based on common strategic interests during the Abe administration, in recent years it appears as if the leaders of Japan and China merely reconfirm the relationship. What do you intend to propose to China on your visit? Also, please offer your views on joint development in the East China Sea and maritime security interests in the South China Sea.

PRIME MINISTER NODA: The question indicated that the Government has simply been reconfirming the mutually beneficial relationship based on common strategic interests with China. I believe that Japan and China truly do share the same relationship. In simple terms, we share a relationship of coexistence and co-prosperity that is win-win, and it is important that we confirm with each other this as a fundamental basis from a broad viewpoint. We occasionally face difficult issues, but I believe that the mutual confirmation of the necessity of this relationship from a greater perspective between leaders is tremendously important in order to overcome those problems. In light of this, I discussed this in Honolulu in my meeting with President Hu Jintao and in Bali with Premier Wen Jiabao.

I believe - or I should say, Japan believes - that the development of China is an opportunity for Japan, and that deepening this mutually beneficial relationship based on common strategic interests goes beyond our bilateral relations and greatly contributes to peace, stability, and prosperity in the region, and the world. Confirming that both countries share this mutual awareness is tremendously important. Moreover, I plan to visit China this month and on that visit I intend to engage in concrete discussion in order to deepen this relationship. Next year is a major milestone as it marks the 40th anniversary since the normalization of diplomatic relations, so in regard to, for instance, reconstruction assistance, tourism promotion, cooperation following the earthquake disaster, maritime cooperation that you just pointed out, and even the promotion of cultural and human exchanges - I, for example, visited China in 1984 when 3,000 youth joined exchanges in China, so in some sense, I am the first product of these exchanges. On my visit I fully intend to discuss with China's leaders about specific ways to promote such efforts, and in particular - the TPP was mentioned several moments ago - I believe that negotiations on the Japan-China-Republic of Korea Free Trade Agreement (FTA) should also commence promptly. Towards this end we have already been in discussions for almost three years concerning an investment agreement, but the final step towards its achievement has yet to be completed. I discussed this with President Hu of China in Bali, and I intend to engage in full discussions concerning the investment agreement and the FTA, which will pick up pace moving forward.

 

CABINET PUBLIC AFFAIRS SECRETARY: Next, please. Yes, Mr. Yamane.

REPORTER: I am Yamane of Kyodo News. My question is regarding efforts aimed at cutting expenditures. It appears that discussion on increasing the consumption tax has been given priority, but even in your policy speech you indicated your resolve to cut overall government expenditures. However, there has been continual criticism in and out of the party that efforts to reduce expenditures have been insufficient. At present, do you believe that you have developed the environment necessary to force such a tax burden increase on the people of Japan? Also, how do you intend to specifically address the issue of expenditure cuts moving forward?

PRIME MINISTER NODA: Concerning the issue of reducing expenditures, thanks to the result of government program reviews and other efforts, we were able to cut government expenditures in fiscal 2010 by 2.3 trillion yen and in fiscal 2011 by 0.3 trillion yen, for a total of 2.6 trillion yen. In light of these facts, I think that we have carried out budget restructuring on a completely different level than past administrations. This issue requires ceaseless effort, and I believe that we must continue to work to carry out further administrative reform and expenditure cuts. Now, for instance, we have submitted a bill that trims civil servant remuneration by 7.8%. We must continue these efforts. Starting with what is closest to us, what can we do in the field of politics? The issue of redressing the vote-value disparity is being discussed, and after that we must reduce the fixed number of seats in accordance with election system reform. We have to carry out discussion on such things as well and we will make unremitting efforts. Furthermore, in next year's ordinary Diet session we plan to submit a bill to amend the Act on Special Accounts. We need to submit a bill that exhaustively examines special accounts reform.

 

CABINET PUBLIC AFFAIRS SECRETARY: Next please, Mr. Nanao.

REPORTER: I am Nanao of Nico Nico Douga. Outside Fukushima Prefecture, radioactive materials that are highly likely to have originated from TEPCO's Fukushima Daiichi Nuclear Power Station have been detected frequently elsewhere in the Kanto region and others. For example, there is a contamination map, but as of now it does not cover all prefectures, and there have been heightening concerns that people have no choice but to conduct surveys of their own. As you have said in your opening statement, if you want to ensure that the people can live with peace of mind, or to prevent reputational damages from spreading, I feel it is necessary to conduct surveys about the dispersion of radioactive materials on a nationwide scale and in a more enhanced manner. What are your thoughts in this regard?

PRIME MINISTER NODA: First of all, we must commit all our efforts into achieving the cold shutdown of TEPCO's Fukushima Daiichi Nuclear Power Station, which is the origin of these radioactive materials. This must by all means be achieved by the end of this month to complete Step 2 of the Roadmap. On that basis, to deal with dispersed radioactive materials, we will do our utmost through operations to decontaminate the disaster zones. I also think some actions should be taken, including monitoring, for areas outside the disaster zones where particular potential for contamination has been pointed out. Rather than immediately proceeding with a nationwide survey, I think we should somewhat narrow down the target.

 

CABINET PUBLIC AFFAIRS SECRETARY: Next please, Mr. Murao.

REPORTER: I am Murao of the Yomiuri Shimbun. My question concerns the Imperial House Act. The Chief Cabinet Secretary announced recently that the Government would consider the establishment of princely houses by female members of the Imperial Family after having a national debate involving all the strata of society. The news is attracting much attention as it concerns the securing of stable Imperial succession. Could you please tell your thoughts on this and how you will proceed with considerations moving forward, including whether or not you will be establishing a kind of expert panel, and so on? Could you also tell us around when the discussion will be concluded?

PRIME MINISTER NODA: Under the current Imperial House Act, female Imperial Family members must leave the Imperial Household upon marriage. Amidst this situation, as some female Imperial Family members are reaching marriageable age, the Grand Steward of the Imperial Household Agency came to provide an explanation of the situation in October. I also perceive this to be a matter of great priority in assuring the stability of the activities of the Imperial Family. This will naturally require a national debate. We have not established the deadline for this in a definite way. We are currently considering how we should move forward with the debate and in what form.

 

CABINET PUBLIC AFFAIRS SECRETARY: We are running out of time so I would like to make the next question the last. Mr. Yamaguchi, please.

REPORTER: I am Yamaguchi of NHK. I would like to return to the topic of consumption tax. You have been repeating with a sense of conviction that you would submit the consumption tax bill in Match next year and have it enacted during the same Diet session. Should this fail to materialize, do you intend to go to the people by holding an election?

PRIME MINISTER NODA: Again, that is a little too speculative. We need to first compile a draft, and then invite the opposition parties to join in the discussion to create an outline. After these processes, we will be submitting the bill, as stipulated in the Article 104 of the Supplementary Provision of the FY2009 Tax Revision Act. If we are submitting a bill, we will of course be aiming to achieve its successful passage through the Diet. As we are going through a number of processes as such, the question of what to do should we fail in the end might be somewhat premature.

 

CABINET PUBLIC AFFAIRS SECRETARY: With that, I will bring the press conference to a close. Thank you for your cooperation.