Japan gov't weighs cash handouts for low-income families' children

© Kyodo News

The Japanese government is considering a 50,000 yen ($390) cash handout program to help low-income households with children as part of its broader economic package to cushion the blow from rising prices, sources with knowledge of the plan said Wednesday.

The envisaged program will provide 50,000 yen for a child aged 18 and younger from a single-parent family or a household that has been exempt from residential taxes due to low income, according to the sources. Around 200 billion yen will be funneled from reserve funds in the state budget for the current business year from April.

Separately, the government is also weighing expanding the already implemented 100,000 yen cash handout program for struggling households, the sources said.

The 100,000 yen handouts are currently disbursed to households that were exempt from residential tax payments during fiscal 2021. The government is considering also giving 100,000 yen to those who were not eligible for the relief program but fit its targeting criteria after the end of fiscal 2021 on March 31, the sources said.

Prime Minister Fumio Kishida is expected to unveil details of the economic package possibly next week amid growing concern about the negative impact of rising energy and food prices on households at a time of an anemic economic recovery from the COVID-19 pandemic.

The envisaged plans could be taken by critics and opposition lawmakers as a cash splurge ahead of the House of Councillors election, expected in July.

An earlier idea within the ruling coalition to give cash handouts to elderly people hit by a fall in public pension benefits was scrapped in the face of similar criticism.

The government and the ruling coalition of the Liberal Democratic Party and Komeito are leaning toward the view that they can gain public support as long as the target of cash handouts is limited to struggling households and child-rearing families, the sources said.

The LDP and Komeito are at odds over how to fund the envisaged economic package as the junior coalition partner has been calling for the drafting of a supplementary budget for fiscal 2022. Kishida has said reserve funds in the already-passed budget will do.

After meeting with Kishida at the prime minister's office, Komeito chief Natsuo Yamaguchi said the issue will be left to the secretary generals of the coalition parties.