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TOKYO - Japan"s Cabinet on Friday approved a record-high budget plan for fiscal 2018, with provisions made to address Japan"s skyrocketing social security costs to support the rising numbers of seniors and significant allocations made for defense spending.
The budget plan, a record-high for a sixth successive year, amounts to 97.71 trillion yen (861.80 billion US dollars), outlines 32.97 trillion yen (290.79 billion US dollars) in allocations for spending on social security and 5.19 trillion yen (45.77 billion US dollars) on defense spending.
The government"s plans for both social security and defense spending have increased to become the highest on record in Japan.
In the general account, 74.41 trillion yen (656.29 billion US dollars) have been allocated for policy spending, with the government continuing to cap its year-on-year social security increases at 500 billion yen (4.41 billion US dollars).
The government has estimated that the revenue it will collect from taxes in the period will increase to 59.08 trillion yen (521.08 billion US dollars), marking the highest in 27 years, with the shortfall being made up by bond issuance to the tune of 33.69 trillion yen (297.14 billion US dollars).
Japan is still struggling to get its fiscal house in order. While its planned bond issuance has been reduced by 2 percent and lowered for the eighth straight year in the latest budget plan, the country still has a public debt level globally never seen before at more than double the size of its 5 trillion-US dollar economy.
The government, while recognizing its dependence on debt, has reduced the ratio of debt to revenue from 35.3 percent in fiscal 2017 to 34.5 percent in fiscal 2018.
"We will continue to aim for fiscal rehabilitation," Japan"s Finance Minister Taro Aso told a press briefing after a Cabinet meeting Friday, adding that exactly how the government plans to achieve a surplus in the primary balance will be revealed as early as possible next year.