The total amount of general-account budget requests by Japanese ministries and agencies for fiscal 2022 has hit a record of over 111 trillion yen (1 trillion U.S. dollars) with expected debt-servicing costs surging amid the COVID-19 pandemic, Trend reports citing Xinhua.
The calculated figure for the year starting in April exceeded 110 trillion yen for the first time, topping 100 trillion yen for the eighth consecutive year. A record-high social security spending amid Japan's rapidly graying population also pushed the increasing budget.
Although much of the planned spending on battling the COVID-19 pandemic has yet to be counted in, the total sum sought goes beyond the 106.6 trillion yen initial budget for fiscal 2021, which included 5 trillion yen set aside for curbing the pandemic.
The latest figure of the initial budget for fiscal 2022 could reach an all-time high for the 10th year in a row, raising concern over the further deterioration of Japan's fiscal health, with debt twice the size of gross domestic product.
Japan has stayed with the goal to turn the primary balance, tax revenue minus expenses other than debt-servicing costs, into the black by fiscal 2025. However, the country plans to post a primary deficit of over 20 trillion yen under the fiscal 2021 initial budget, accelerated by the pandemic.
Breaking down the total amount, the largest request came from the Health, Labor and Welfare Ministry, which asked for 33.9 trillion yen, the most ever by a ministry or agency. Spending on medical and nursing care as well as other social security programs kept rising as the population ages.
The debt-servicing costs went up significantly amid the pandemic. The ministry sought 30.2 trillion yen for interest payments and other debt-servicing outlays, which increased by over 6 trillion yen from the fiscal 2021 initial budget.
The Defense Ministry made a 5.4 trillion yen budget request, larger than a record initial budget of 5.3 trillion yen for fiscal 2021. The defense budget request excluded outlays related to hosting U.S. military bases, which have been about 200 billion yen annually.
The Japanese government had set aside about 4.4 trillion yen as special reserves for ministries and agencies to promote key policies such as decarbonization and digitalization under the green growth strategy.