Requests for Drastic Regulatory Reforms

Takao KUSAKARI
(President, NYK Line, and Co-Chairman, Committee on Administrative Reform, Keidanren)

Now is the time for regulatory reforms

Japan is now facing a severe condition of increasing unemployment in the deflationary economy. If, however, we postpone necessary reforms due to our fear of their negative economic impact, it would become more difficult for us to build a vigorous economic system to be lead by the private sector, and more likely to be long-term stagnation in the future. We think that regulatory reform should be regarded as an important pillar for Prime Minister Koizumi's "structural reform without sacred cows," and the government must carry it out to alter the high cost structure and create new employment for the revitalization of the Japanese economy.

Although the Japanese government has already been working on regulatory reforms at the Council for Regulatory Reform and other related organizations, even in those areas that used to be regarded as "sanctuaries," it may be required to handle this matter in a better-focused and speedier manner. We, Keidanren, hereby announce our renewed requests to the government and related agencies for regulatory reforms in such items that we think are especially important and urgent by reexamining our previous requests, "Keidanren's Requests for Regulatory Reforms for FY 2001" (October, 2001:http://www.keidanren.or.jp/japanese/policy/2001/044/mokuji.html) in an attempt to facilitate regulatory reforms in various fields while anticipating a revision of "the Three Year Plan for Promotion of Regulatory Reforms" (adopted by the Cabinet on March 30, 2001) in late March this year.

Three main pillars in our renewed requests

In our renewed requests, we take up 54 items in 14 fields including employment and labor, pension, medical care, education, distribution and so on. Based on "the Three Year Plan for Promotion of Regulatory Reforms" and "the First Recommendation for Promotion of Regulatory Reforms" (prepared by the governmental regulatory reform committee on December 11, 2001), we classify those items into three major pillars as follows.

1. The first pillar: "early implementation and further examination of the items in the First Recommendation for Promotion of Regulatory Reforms." First, many of the requests that we, Keidanren, made last October regarding such important items as medical care, employment and labor have been incorporated in the "First Recommendation" by the Council for Regulatory Reform. We think that it is important to have a revised plan to include these items and have it implemented as soon as possible.

For example, in the field of medical care, we, Keidanren, are requesting a new system where screening and payment operations for medical service invoices can be conducted without relying on the social security service payment fund currently under the administrative guidance of the Ministry of Welfare and Labor. We hope that this system of screening and payment by those who are insured will be adopted as soon as possible, preferably by the end of FY 2001, that is March 31, 2002, as stated in the "First Recommendation," without imposing excessive regulations on the health insurance association and contracted insurers.

On the other hand, there are a few items that have been insufficiently incorporated in the "First Recommendation." For these items, a further examination should be made to improve their contents. For example, in the distribution field, Keidanren has been demanding that such drugs as those often requested by consumers and not requiring pharmacists' help be allowed to be sold in general retail stores. Regarding this matter, however, it is only mentioned that "a further examination is needed" and no specific contents are taken up in the First Recommendation. We would like to ask for reexamination and facilitation in this case.

2. The second pillar: "improvement of the "Three Year Plan for Promotion of Regulatory Reforms." The Council for Regulatory Reform is expected to oversee and facilitate the implementation process for those reform items listed in the "Three Year Plan." In that connection, we hope that those items listed in the Third Plan" and related to Keidanren's requests will be examined, improved and implemented as soon as possible.

For example, in the education field, Keidanren has requested that distance learning by using the Internet be officially permitted at all levels of education from primary schools through universities. In the "Three Year Plan," however, it is only mentioned that "possibilities should be examined" regarding the abolition of credit limits for correspondence courses at colleges and the adoption of courses using the Internet at high schools, with conclusions expected by the end of FY 2002. We request that credit limits for correspondence courses be further relaxed and the scope of distance learning be extended to the primary and middle school levels in order to secure equal opportunity of education for those who are disadvantaged due to long-term illness and other obstacles.

3. The third pillar: "adoption of new reform items". Requests for adoption in a revised program are being made regarding those items that have been recommended by Keidanren but were not adopted in either the "Third Year Plan" or in the "First Recommendation." For example, there are such items as "a revision in competitive bidding procedures to make use of the PFI business approach initiated by the private sector," and "an extension of the period for regular inspection for nuclear power plants."

Strengthening partnerships among related agencies for regulatory reforms

We also call for strengthening partnerships among related agencies to promote regulatory reforms and secure transparency such as publication of results of committee discussions.

For example, the regulatory reform agenda was taken up by the Council on Economic and Fiscal Policy on November 9th, 2001, and a few dozen items for regulatory reforms were discussed and adopted for promotion as a follow-up on the reform process table. Those regulatory reform items in the fields of IT, postal services and urban revitalization are being examined in "the IT-related Regulatory Reform Special Committee," "the Study Group for Public Postal Services" and "the Urban Revitalization Headquarters," respectively. We hope that the Council for Regulatory Reform will take its initiative in cooperation with those related agencies in order for the government as a whole to act effectively for regulatory reform, and request that the power of the Council for Regulatory Reform be strengthened as necessary in order to promote such actions.

At the same time, we think that results of supervision of the implementation process for the "Three Year Plan" as well as results of examination of reform requests from various organizations at home and abroad, including Keidanren, along with their evaluation, criteria, etc. should be posted publicly on websites or elsewhere, in order to improve the degree of transparency for the regulatory reform process.

Hope for political leadership

Needless to say, strong political leadership is necessary for realization of such drastic and prompt regulatory reforms. We, Keidanren, presented our renewed requests including new reform items to the government at our meeting in January with some members in the Cabinet Office including Minister Ishihara in charge of regulatory reform, and received a positive response from Mr. Ishihara himself. We hope that he will work hard for our requests to be adopted and implemented.

We ourselves should act on the basis of self-reliance, independence and self responsibility in the business community, and will fully support the Council for Regulatory Reform and other governmental efforts for reform in the future.

(The original Japanese version of this article is available at:
http://www.keidanren.or.jp/japanese/policy/2002/004.html)