Prime Minister Fumio Kishida said Friday a new economic package now being compiled will seek to lower utility bills next year for households hit by accelerating inflation, targeting electricity and gas.
Kishida, who faces faltering public support, expressed his intention to draw up a package later this month that will satisfy the public.
Surging energy prices have been a headache for resource-poor Japan, which relies on imports to meet its domestic needs. The yen's rapid decline against the U.S. dollar, already at its lowest in 32 years, has exacerbated the pain for consumers because it inflates import costs.
The government has already launched a subsidy program for oil wholesalers to help reduce retail gasoline and kerosene prices. The program will be extended beyond December, Kishida said.
"We will draw up a bold economic package that can convince ordinary Japanese with its substance and size," Kishida told reporters after meeting with Natsuo Yamaguchi, who heads the junior coalition partner Komeito.
The package will focus on three areas -- addressing rising prices and a weaker yen, spurring wage growth, and rejuvenating the economy through investment and reform.
The government will hash out the details of the package and decide on its size, with an eye to submitting an extra budget for fiscal 2022 to parliament during the current session until December.
The envisaged program to reduce electricity bills for households will begin as early as January, given that higher energy prices caused by Russia's war against Ukraine will likely translate into a 20 to 30 percent surge in electricity expense from next spring onward, Kishida said.
The government will consider creating a similar program for city gas.
A year after taking office, Kishida is facing an uphill battle to reverse the downtrend in his public support. The precipitous drop is attributed to his decision to hold a state funeral for former Prime Minister Shinzo Abe, an influential but controversial figure who was killed in July by a gunman, and public criticism over dubious ties between ruling party lawmakers and a religious group.
The government's focus on utility bills, a major component of household spending, apparently reflects its attempts to make its assistance visible and support a still fragile economic recovery from the COVID-19 malaise as surging prices of fuel and everyday items like food are weighing on consumer sentiment.
Consumer inflation in Japan has been accelerating in recent months, with its key index topping the Bank of Japan's 2 percent target for the past five months, though the inflation rate is still far lower than in the United States or Europe.
