Extra Diet session begins with minority govt; budget, reforms on agenda

Japan's Diet convened an extraordinary session Thursday for deliberations on a supplementary budget to help inflation-hit households and revise a political funds law after a bruising scandal, in the first major test for Prime Minister Shigeru Ishiba's minority government.

The 24-day session through Dec 21 will see Ishiba engage in substantive parliamentary debate for the first time since his ruling coalition lost its majority in the House of Representatives in late October.

With opposition support critical for passing budgets and bills, Ishiba acknowledged in remarks to reporters that he would "have to listen more carefully to the views of each party" in the Diet deliberations.

Ishiba is scheduled to deliver a policy speech on Friday in which he is expected to say the government will raise the income threshold for tax payments from the current 1.03 million yen, as floated by the small opposition Democratic Party for the People.

The prime minister will then answer questions from opposition party leaders in both houses of parliament. Deliberations on a yet-to-be-compiled extra budget, likely worth around 13.9 trillion yen, for the current fiscal year ending March are expected to begin on Dec 9.

Passage of the budget is essential to fund a newly compiled economic package that includes cash handouts for low-income earners and the extension of subsidies to lower energy prices this winter.

Ishiba's Liberal Democratic Party and its junior coalition partner, the Komeito party, are warming to the DPP, exploring cooperation on a policy-by-policy basis, instead of forming an outright tripartite coalition.

Diet deliberations will likely become more demanding for the ruling parties due to an increase in the number of parliamentary committees chaired by opposition lawmakers, reflecting the change in power dynamics after the election.

The reins of the powerful lower house Budget Committee have been handed over to the major opposition Constitutional Democratic Party of Japan, meaning Ishiba will likely need to spend more time answering questions from opposition leaders in parliament.

In a fresh bid to restore public trust undermined by the LDP's lax handling of political funds, Ishiba has promised a legal revision by the end of the year to make the flow and use of political funds more transparent.

Some LDP members, including heavyweights, were found to have amassed slush funds without declaring income from fundraising parties, a scandal that led to the party's dismal election results. Ishiba dissolved the lower house shortly after taking office on Oct 1, vowing to win back public confidence.

The ruling and opposition parties have agreed on the need to abolish policy activity funds that lawmakers receive from their political parties and can use without disclosure.

But the parties remain apart on what to do with donations from businesses and other groups as the LDP, which relies heavily on such contributions, is opposed to the idea of a ban, as proposed by the opposition.

A bill to revise the political funds control law is expected to be drafted based on cross-party discussions.