Press Conference by Shizuka Kamei, Minister for Financial Services

(Excerpt)

(Friday, October 9, from 12:22 p.m. to 1:01 p.m.)

[Opening Remarks by Minister Kamei]

Before today's cabinet meeting, a meeting of the Basic Policy Cabinet Committee was held for 20 or 30 minutes. One of the main topics was the government's plan for the schedule of the (upcoming) extraordinary Diet session, which will be discussed with the ruling parties. The government wants to discuss the schedule with the ruling parties with a view to holding the extraordinary Diet session from around October 26 to the beginning of December.

We also discussed the future management of the Basic Policy Cabinet Committee. I am not a man of precise mind and this committee discusses important policies and makes final decisions. Therefore, if we are to discuss specifics, it will be convenient to have support staff for the committee, as Ms. Fukushima (Social Democratic Party) and I are participating in the committee as the leaders of our respective parties, which are partners of the three-party coalition government. If I can hold appropriate discussions at the committee as the representative of my party, I would not need to discuss the same matter with my party officials again, so it would be better to appoint such support staff. The Chief Cabinet Secretary and the Deputy Prime Minister said they will consider appointing such support staff. I expect they will consult me about this matter again.

In addition, I made a strong request regarding the negative legacy left behind by the previous government, namely the outrageous supplementary budget, which is being implemented. I said that while we are trying to suspend the implementation, we must not only dispose of the negative legacy but also take measures to inject vitality into the Japanese economy and society under our new government. As for the economy, external demand cannot be expected to grow strong in light of the situations in the United States and other countries, so how to create domestic demand — the Prime Minister pledged to expand domestic demand at an international conference — will be our challenge for the moment. In the current situation, we should suspend the implementation of the supplementary budget that was adopted by the previous government, as its implementation is unlikely to stimulate private-sector demand now. The new government should take measures to create domestic demand with government expenditures. I stressed that if we are to submit a supplementary budget around January next year, the relevant ministers should discuss what kind of government expenditures will create domestic demand. Deputy Prime Minister Kan and the Chief Cabinet Secretary said they will consider my suggestion. That was what I proposed at today's meeting of the Basic Policy Cabinet Committee. Perhaps because there was not sufficient time, a conclusion was not reached today. However, I expect that the government as a whole will tackle this matter seriously.

As for what is called the “moratorium” scheme, the working group is studying its details under the leadership of the parliamentary secretary and the senior vice minister, and I expect to receive a briefing on a proposal drawn up by the working group this evening. While I have made various comments on this scheme, I will make my own judgment after looking at the proposal. The Ministry of Economy, Trade and Industry, which has jurisdiction over small and medium-size enterprises (SMEs) has sent its parliamentary secretary to join the working group as a member, so the ministry's ideas will be incorporated into the proposal. Although the Ministry of Finance is not directly involved in this, I also think that it is necessary to seek the understanding of the ministry on our draft bill and that it will be better to seek advice from the standpoint of the ministry before I express my view at the working group. Therefore, at the cabinet meeting, I asked Minister of Finance Fujii to express the MoF's opinions on the working group's ideas when our senior vice minister consults vice minister of the MoF, so the senior vice minister is going to meet him.

We are now drawing up a realistic and effective bill while seeking opinions from a wide range of sources, including the representatives of the financial industry and SMEs as to how to facilitate financing for SMEs. Although I will make a final decision after looking at the proposal this evening, I expect we will be able to submit the bill at the beginning of the extraordinary Diet session in November. Despite unreasonable criticism from you journalists, the study on the details of the bill has smoothly proceeded, moving roughly in the direction I had in my mind from the beginning, so I expect we will be able to submit it at the beginning of November.

Regarding the review of the postal businesses, as I told you the other day, we intend to draw up a bill to suspend the sale of shares and assets before the start of the extraordinary Diet session, and, if possible, we hope to enact a basic law, too. However, as the period of the session is very short, we must race against the clock if we are to enact the latter. Therefore, it is not clear whether we can fix the details of the basic law in the short period of time, so it may be better to listen to more opinions from various people. The Prime Minister also offered me a good idea (about business of the Japan Post) when I met him yesterday. As I told you over and over again, I have no intention of restoring the postal businesses, which have been broken up by Mr. Koizumi (former Prime Minister), to their status before the breakup. We will decide what services the postal business should provide and how they should be reorganized from the perspective of what kind of organization is suited to invigorate both local communities and the country as a whole. This is my stance, and I have never thought of restoring them to their former status. As I have told you over and over again, I was not of the “postal clan” (a group of politicians with vested interests in the postal businesses) even when I was a member of the LDP.

While we are considering this matter, I think you are strongly interested in the fate of the current management team. As I have repeatedly told you, we should deal with this matter with the stance of putting new wine in a new bottle. Depending on how this matter will be settled, employees may have to do their job amid uncertainty. Although the business operations are continuing now, we will make a major change of course. Therefore, it is quite obvious that the management team must make clear in which direction the course will change and how the businesses will be reorganized. I will take on the responsibility for ensuring that the uncertainty will be cleared by the end of October. In this respect, I assure you that you do not have to be worried at all.

That's all I have to say. Are there any questions?

[Questions and Answers]

Q.

I would like to ask you about the draft bill to deal with curbs on new loans and forcible collections of outstanding loans, regarding which you have not yet received a report. However, you said earlier that (the study on the bill) is moving roughly in the direction you have desired, so have you received any interim report?

A.

As frankness is welcome, various opinions have been expressed by my subordinates, and during the process of working out a good proposal while taking them into consideration, Senior Vice Minister Otsuka has been constantly reporting to me. Moreover, the FSA Commissioner has been constantly reporting to me with regard to the direction and the state of the work conducted by FSA staff. For my part, I have often expressed my own opinions, so at the working group, such opinions will be… The three ruling parties have been studying this matter all along. Now that we are in the last stage of the study, we are now working hard on how to reflect the three parties' views in the wording of the bill. This work is mostly going well. Generally speaking, it is going in the direction I had in mind from the beginning. It is only you who do not believe this is going well. We believe that this bill will be effective in meeting the expectations of SMEs and that financial institutions will judge that they can properly respond to it.

Q.

Are you planning to make an announcement after receiving a report later today?

A.

That depends on the contents of the report. As this is mostly going well, I will not need to make suggestions for any major change, although I may suggest minor revisions. Therefore, it is not clear whether I can reveal something like a final draft today. As there is still time before we submit the bill, we may continue making revisions until next week. Although I hear that you have a news space set aside in your newspapers, waiting for my announcement, I am sorry to say we cannot do our job so as to suit your convenience.

Q.

I would like to ask you about what is called the “moratorium” scheme. How much chance do you think that there is of the bill being enacted during the extraordinary Diet session, whose period is limited, and what have you discussed about this with Secretary-General Ozawa and Prime Minister Hatoyama?

A.

That is not something you have to worry about. Please rest assured. Don't worry.

Q.

Regarding the bill to introduce the “moratorium” scheme. While the working group is drawing up a final draft, I suppose that members of the Ministerial Policy Councils (SEISAKU KAIGI) and DPJ lawmakers will ask to express their own opinions.

A.

My understanding is that the working group has already been doing that. Hasn't the working group held hearings under the leadership of the senior vice minister?

Q.

Do you mean that the working group combines the function of the Policy Council?

A.

That is natural. Anyway, the senior vice minister is taking care of everything. He has done this all along, so the working group will probably also function as such. I believe that nobody has been excluded from it.

Q.

It is possible, for example, that after committee deliberations have started in the Diet, the ruling parties will propose amendments to the bill. What do you think of that possibility?

A.

If such proposals are to be made, I believe that they have already been expressed to us. I am sure that such proposals have been submitted and discussed at the working group. I think it is unlikely from a common sense perspective that an amendment will be proposed at a committee if it is not proposed at the working group. I believe that Mr. Otsuka is taking care of that. From our party, Mr. Shimoji is participating in the working group, so our party is unlikely to ask questions about the bill at a committee session of the Diet. Nor do I expect that our party will propose an amendment there.

Q.

You said that you will receive a report about the details of the bill to introduce the “moratorium” scheme this evening. You have stated that a “moratorium” will not be applied universally. Do you have in mind any dividing line between people eligible for the moratorium and those who are not?

A.

The working group is studying this matter as a whole, including that point, and I will receive a report from the group this evening. I am not sure at the moment whether I will make an announcement to you after receiving and approving the report or I will suggest some revisions. There is no reason for making comments before this evening. Even if you have set aside a space for news about that in your newspapers, I think you can still fill it with other news.

(End)