Executives' Comments  Press Conferences   Chairman Sakakibara's Statements and Comments
at His Press Conference

November 27, 2017

Corporate Contributions to Childcare Policy

With the proposed increase of the consumption tax to 10%, the idea of reconsidering the use of the funds thus collected and directing them to support for children and childrearing is in line with Keidanren's views. If the entire populace is to face an additional burden in the form of the consumption tax hike, the business community will also bear a corresponding burden, on the premise of such a tax increase, and to assist in bold measures to combat Japan's declining birth rate. From the perspectives of helping employees to remain in their jobs while balancing work and family, the business community would like to cooperate in bringing forward the realization of the government's Kosodate Anshin Plan, an assistance package designed to eliminate the shortage of childcare places. However, we will also demand that any plans to make childcare and early childhood education for three- to five-year old children free be restricted to cases where economic assistance is truly necessary, to ensure that it does not lead to pork barreling, and that funding for future programs for the support of children and childrearing be properly secured with tax resources. Further, the Japan Chamber of Commerce and Industry has expressed concerns about corporate contributions to childcare policy placing an undue burden on small and medium enterprises. In addition to measures to reduce that burden, such as lowering labor insurance premiums, it will be necessary to apply the business PDCA to secure companies' understanding.

Tax Reform

I realize that consideration is being given to making companies with insufficient wage rises and capital spending efforts ineligible for special measures concerning taxation such as the R&D Tax Credit System. At the Growth Strategy Council — Investing for the future — on November 17, I strongly urged Prime Minister Abe to do even more, such as significantly reducing the tax burden from corporate income tax and fixed assets on companies that adopt a positive approach to capital spending and wage rises, to encourage companies to take such actions over a three-year period of concentrated investment by 2020. I understand that the government is proceeding with the deliberation of tax reforms in the wake of these suggestions.

On the question of income tax reform, it appears that the government is considering cutting the income deductions for high income-earners. The review of income deductions is in line with the demands of the changing times, and I understand the need for reform. Regarding wage income exemptions as well, consideration needs to be given to the fact that freelancers and people who work from home incur the same kinds of expenses as people employed by companies. Regarding dependent deductions, when this system was first established, single-wage families with full-time housewives were the norm, but today, with the increase in double-income households, more consideration needs to be given to what deductions on a per-household basis should look like.

Restarting the Nuclear Power Plants

Fukui Prefecture's Governor, Issei Nishikawa, has announced that he will consent to the restarting of the No. 3 and 4 generators at Kansei Electric Power Company's ?i Nuclear Power Plant. Keidanren has consistently asserted that nuclear power should be used as an important baseload power source. Those nuclear power plants that meet the new regulatory standards of the Nuclear Regulation Authority should be restarted promptly, on the basis of the agreement of the local communities. The business community welcomes the restarting of ?i Nuclear Power Plant's No. 3 and 4 generators as being in line with this trend. We hope that the operators, government, and other relevant parties will continue to keep the public fully informed about the safety of nuclear power plants that meet the new regulatory standards, to further the understanding of local residents and the citizens of Japan.

Corporate Scandals

The recent revelations regarding the falsification of inspection data by a company in the Mitsubishi Materials Group were extremely disappointing. There has been a string of scandals involving major Japanese companies of late. This is a grave situation that has the potential to adversely affect the trust held in Japan's manufacturing industry. Each of these cases has its own particular background circumstances, such as quality control and testing regimes, and I understand that efforts are being made to investigate the causes and take action to prevent the same thing from recurring. While I do not believe that faith in Japan's manufacturing industry as a whole will be immediately shaken, we must maintain a sense of crisis, go back to basics, and work to restore trust.

Article 10 of the recently revised Keidanren Charter of Corporate Behavior calls on top management to play a firm role in achieving full compliance with the Charter. Specifically, top management is asked to build effective governance systems and to raise awareness within their own corporations and their entire corporate groups. For its part, Keidanren will continue to call on the top management of corporations to ensure full compliance with the Charter of Corporate Behavior.

1997 Financial Crisis

The collapse of Yamaichi Securities in 1997 had a massive impact on Japan, both economically and socially. From 1997 to around 2012, there was no growth in Japan's nominal GDP and the financial turmoil of 20 years ago was the starting point of Japan's deflationary spiral. On the other hand, the lessons learned from the collapse of financial institutions prompted other companies to build their own crisis management systems and this has led to the stability of financial systems that we see today.