Japan's Prime Minister-elect Yukio Hatoyama said on Saturday he had picked Naoto Kan, a former health minister, to head a powerful new agency that will oversee the budget process and set policy priorities, Reuters reported.
Hatoyama, who will take office on September 16, said that in addition to heading the National Strategy Bureau, Kan, 62, will also be deputy prime minister, and that Katsuya Okada, 56, had been chosen to be foreign minister.
Both Kan and Okada are former leaders of the Democrats and had been tipped as potential finance ministers. Hatoyama said that he will formally nominate them at a party meeting on September 7.
The Democrats come to power with ambitious spending plans to put more money in the hands of consumers, raising concerns they will inflate a public debt already about 170 percent of GDP, the highest among advanced countries.
The new National Strategy Bureau, to include both public and private sector officials, will be tasked with reforming what the Democrats have said is a cumbersome policy-making system.
Kan's experience in tangling with bureaucrats when he exposed a scandal over tainted blood products at the health ministry could stand him in good stead.
The new strategy bureau will seek to implement a Democrats' promise to bring elite bureaucrats to heel and put politicians back at the center of policymaking.
Although Japanese media have reported Hirohisa Fujii, a former finance minister, is likely to be picked for that post, they quoted Hatoyama as saying on Saturday that he was not yet ready to name his choice for finance minister.
Fujii, 77, is the head of the Democratic Party's tax panel, and he has called for funding Japan's social welfare costs with consumption tax revenue and discussing over the next four years the issue of raising the sales tax.
He said Tokyo should not step into currency markets unless exchange rates move abnormally, adding that a strong yen is good for Japan.
Nikkei also said Masayuki Naoshima, the DPJ's policy chief, was likely to hold one of the economic cabinet posts.
The Mainichi daily newspaper said Hatoyama picked Okada for his connections in the United States.
Hatoyama's choice for the top diplomatic portfolio is being closely watched after concerns emerged that his party's policy of adopting a more independent stance from the United States could damage ties with Tokyo's biggest security ally.
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