Japan to weigh cash disbursements to ease inflation pains: reports

TOKYO: Japan is considering another 50,000 yen (RM1,657) worth of cash payments to low-income households with children as part of measures to be put together later this month to ease the pain of inflation, domestic media reported on Friday (March 10). .

The news followed Prime Minister Fumio Kishida’s direction last week for the ruling coalition to outline the necessary steps over the next two weeks.

Demands from politicians will pressure the Kishida government to spend even more, which could add to public debt burdens, especially ahead of elections like the nationwide local elections scheduled for April.

The Liberal Democratic Party and its small coalition partner Komeito intend to draft their own proposals next week before the government puts together measures, including a repeat of 50,000 yen payouts first passed last year.

The per-child payout is aimed at low-income single parents and those exempt from residence tax, public broadcaster NHK reported.

Japanese households are grappling with mounting cost-of-living pressures amid increased energy and food inflation.

Rounds of strong stimulus spending have exacerbated the industrial world’s heaviest public debt, which is more than double the size of Japan’s economy, the world’s third-largest.

For now, the government is expected to tap into emergency reserves already earmarked for next fiscal year’s budget. But further spending could weigh on Japan’s debt problems.

One of the main opposition parties is also set to submit a law to parliament offering cash gifts equal to the ruling coalition.

Japanese household spending fell 0.3% year on year in January, government data showed on Friday, against the median market forecast for a 0.1% decline.

On a seasonally adjusted monthly basis, household spending rose by 2.7% for the first time in three months, compared with an estimated 1.4% increase. – Reuters