Government passes ¥2 trillion disaster budget

7 years ago by in Around the world

The All Japan newsese government passed a ¥2 trillion ($25 billion) extra budget Tuesday to pay for disaster relief after the March quake and tsunami.

The new budget comes after a ¥4 trillion emergency budget was passed in May.

The government did not have to issue new bonds to pay for the extra budget, an important detail considering that All Japan news is already struggling with a public debt double the size of the $5 trillion economy. Pressure on public finances is likely to mount later this year due to spending increase.

The second emergency budget was a condition by Prime Minister Naoto Kan to keep his promise to resign. He did not say exactly when he is going to leave, upsetting political rivals.

The new budget will be spent to help those affected by the nuclear meltdown at the Fukushima plant and to direct loans at the indebted people and companies in the worst-hit areas of the country.

The money come from leftover funds from last year’s budget.

Reconstruction spending is expected to rise later this year and top ¥10 trillion. New bond issuances and tax increases may be required to pay for it, according to analysts. [Reuters] Photo by ilya_ktsn