Press Conference by the Chief Cabinet Secretary (Excerpt)

Q&As

• The national ratio of jobs to applicants
• The Trans-Pacific-Partnership(TPP) agreement
• The right of collective self-defense
• The terrorist attack in the Xinjiang Uygur Autonomous Region of China
• The reduction of the corporation tax
• The discussion of amendment of the Constitution

REPORTER: I have a question concerning the national ratio of jobs to applicants for March. The ratio for March was 1.07, marking a 0.02 point increase over the previous month and maintaining a continued upward trend for 16 consecutive months. What are your thoughts on this result?

CHIEF CABINET SECRETARY SUGA: The total unemployment rate for March 2014 remained static and as you just mentioned the national ratio of jobs to applicants for March improved 0.02 points, to stand at 1.07. My recognition is that currently the employment situation is continuing to steadily improve. It will be necessary to continue to monitor the impact on employment of such factors as the reaction to the last minute surge in demand before the raising of the consumption tax, and economic trends overseas. Whatever the case, the Government will precisely implement the employment measures that have been incorporated in the fiscal 2014 budget and make every effort to further improvement of the employment situation.

REPORTER: I have a related question. As you just mentioned there is expected to be some reaction to the last minute surge in demand prior to the raising of the consumption tax. What are the Government’s views on such a reaction?

CHIEF CABINET SECRETARY SUGA: I think it is reasonable to assume that there will be some reaction following the raising of the consumption tax. The Government has taken measures to ensure that such a reaction is kept to a minimum and that there is no economic relapse. Looking at the trends up to now since the consumption tax was raised, I would say that the reaction is within the scope that the Government anticipated.

REPORTER: I have another related question. In the meantime, it has been pointed out that there is a shortage of labor, particularly in terms of part-time workers in sectors such as civil engineering, services and manufacturing. I understand that the Government is considering the utilization of foreign workers, among other measures. What is the Government’s view on the labor force situation?

CHIEF CABINET SECRETARY SUGA: As you noted, the labor shortage is starting to become highly noticeable in a number of sectors. What is more, given that the 2020 Olympic and Paralympic Games are now scheduled to be held in Tokyo, it will be necessary to respond swiftly in a manner that takes into account such future scenarios.

REPORTER: With regard to the Trans-Pacific Partnership (TPP) agreement, in a public hearing of the Senate Committee on Finance of the United States, United States Trade Representative Michael Froman stated that the United States and Japan crossed an important threshold in bilateral market access discussions. Does this imply that Japan and the United States have reached a substantive agreement?

CHIEF CABINET SECRETARY SUGA: I am aware of the oral testimony given by Trade Representative Froman. As Minister Amari and I have stated on repeated occasions, the recent Japan-U.S. consultations resulted in advances on important issues and although we are making progress in the negotiations, we have not yet reached a broad agreement. As was noted in the joint statement issued by Japan and the United States, we have identified a path forward on important bilateral TPP issues. It is my belief that the views expressed by Trade Representative Froman in his testimony to the Senate Committee are fundamentally the same as those of the Government of Japan.

REPORTER: I have a related question. Does the Government now intend to provide informal explanations to persons concerned, including Liberal Democratic Party (LDP) members, about the developments to date in the closed negotiations, in order to seek their understanding?

CHIEF CABINET SECRETARY SUGA: As I just noted we have in fact not yet reached a general agreement. I think it is therefore self-evident that the Government would seek to explain the situation and process to party members. Nevertheless, the process as a whole is not limited to only Japan and the United States. A very significant portion of the overall TPP process are not disclosed. Therefore I believe we will provide an explanation of the overall progress, to give an overview of the negotiations.

REPORTER: I have a question that is related to the earlier question concerning labor relations. Following his address at the dinner hosted by the City of London, in a question and answer session with journalists Prime Minister Abe expressed a desire to deregulate the labor markets, including working hours, and proceed with system reforms. You just indicated your recognition that the employment situation is improving, following the announcement of the recent rise in the national ratio of jobs to applicants. However, there are some people who are concerned that the deregulation of certain labor regulations would lead to deterioration in working conditions for some workers. At this point what kinds of reforms to labor regulations is the Government contemplating?

CHIEF CABINET SECRETARY SUGA: It is my understanding that the Prime Minister’s comments did not imply that working conditions would become disadvantageous for workers. Rather I believe the Prime Minister was expressing the intention of the Government to create a working environment that is in-step with the times and is one where people find it easy to work.

REPORTER: According to some press reports, the necessary legislation is being prepared to enable Japan to exercise the right of collective self-defense. These reports claim that the Government and the LDP are considering establishing a new ministerial position in charge of this matter in order to respond to deliberations in the Diet about the various related bills in the extraordinary session this autumn. What are the facts behind these reports?

CHIEF CABINET SECRETARY SUGA: I have also read this in newspaper reports, but I have not actually heard any such discussions.

REPORTER: I have a question about the terrorist attack in the Xinjiang Uygur Autonomous Region of China. The Government of China has issued statements about the attack, but what is the understanding and thoughts of the Government of Japan concerning the current situation?

CHIEF CABINET SECRETARY SUGA: I am aware of this incident through media reports and other means. The Government would like to offer its sincere condolences to those who have been affected and will continue to monitor the situation and related developments. No Japanese nationals have been confirmed as having being affected by this incident.

REPORTER: I have a question concerning corporation tax. There are some press reports that suggest that in June the Government will formulate a draft basic policy that will clearly state that from next fiscal year the current corporation tax rate will be reduced in phases. What are the thoughts of the Government on this matter?

CHIEF CABINET SECRETARY SUGA: Firstly, I am aware of these reports. The Council on Economic and Fiscal Policy is discussing corporation tax. However, nothing has been decided yet about whether the draft basic policy will include any mention of corporation tax. We will continue to hold Council meetings. That being said, at the World Economic Forum 2014 Annual Meeting in January this year, the Prime Minister announced the Government’s policy to engage in corporation tax reform, with a view to making Japan among the most business-friendly places in the world. Furthermore, in the most recent elections for the House of Representatives and the House of Councillors the LDP included the lowering of the corporation tax rate in its campaign pledges. We are now therefore discussing this in the Council on Economic and Fiscal Policy, the Tax Commission, and other fora. My understanding is that the LDP Research Commission on the Tax System has also begun similar discussions.

REPORTER: On a different topic, tomorrow will be Constitution Memorial Day. Around this time last year there was lively discussion about the amendment of Article 96 of the Constitution, which concerns the requirements and conditions for tabling a bill to amend the Constitution, and political parties expressed a variety of opinions on the subject. However, it seems that at this point in time discussion on this issue has cooled somewhat. With regard to the exercise of the right of collective self-defense, some of the Diet members who are in favor of amending the Constitution have also been voicing concerns that rather than amending the Constitution, the Government might instead simply revise the interpretation of the Constitution. What is the stance of the Government on this issue?

CHIEF CABINET SECRETARY SUGA: Firstly, rather than the stance of the Government, it was the case that in 2012 the LDP announced the ideal form of the Constitution in a draft bill for constitutional amendment. Since then the party has promoted its stance to a broad section of the public. That party stance is entirely unchanged and indeed this is one of the major pillars of the LDP Constitution. Based on the deliberations in the Commissions on the Constitution on the national referendum system, I think that what is currently important is to move the process steadily forward. Whatever the case, we held consultations among the ruling and opposition parties, and recently a total of seven parties jointly submitted a draft bill on this matter. I believe it is first of all important for each of the parties to continue to engage in thorough discussions on constitutional amendment and raise public awareness on this issue.