JAPAN: Growing elderly population pressures on social security system

. OSAKA, Japan / The Yomiuri Shimbun / January 20, 2009 The ruling and opposition parties should discuss in concrete term in the Diet budgetary debates how to reform the social security system and where to find the financial resources to do so, The Yomuiri Shimbun commented in an editorial today. Deliberations the government-proposed second supplementary budget for fiscal 2008 began Monday. Prime Minister Taro Aso reiterated his intention to raise the consumption tax rate from fiscal 2011 on the assumption of economic recovery. Due to the declining birthrate and a growing proportion of elderly people, the social security system is faced with increasing difficulties. It also is urgent to shore up the economy in the near term. Aso said the government would not be able to take economic measures without anxiety unless there was sufficient revenue, and that the government must not act irresponsibly. His stance is quite natural, the editorial commented. The government endorsed a medium-term tax reform program in late December, specifying that "a necessary legislative step is to be taken in advance so that fundamental tax system reform, including the consumption tax rate hike, can be implemented from fiscal 2011 on the assumption that the economy improves." The program also said that "tax reform is to be implemented by the mid-2010s in a phased manner." © The Yomiuri Shimbun