Japan's Prime Minister Fumio Kishida wears a protective face mask to speak at the beginning of an extraordinary session of the lower house of parliament, amid the coronaviruses disease COVID-19, in Tokyo, Japan on December 6, 2021. TOKYO, Dec 7 Reuters -- Japan will review the timeframe early next year for its goal of balancing the budget, Prime Minister Fumio Kishida said on Tuesday, brushing aside the possibility that it might ditch the goal to boost spending.
The government unveiled a record $490 billion spending package to support a fragile economy last month, bucking a trend towards withdrawing crisis-mode stimulus measures.
Kishida remains under pressure from influential advocates of big spending within his ruling Liberal Democratic Party LDP, some of whom have called for a government target to balance the budget. In a move to counter such calls, proponents of fiscal reform, including former finance minister Taro Aso, created a new LDP panel on Tuesday to discuss steps to put Japan's fiscal house in order.
Kishida told the panel that sound fiscal policy was the bedrock of Japan's deal with the Pandemic and restoring Japan's fiscal health.
Kishida said the government will start early next year's debate on whether the current timeframe for hitting the budget target is feasible.
Japan has set a timeframe for bringing back the primary budget, excluding bond sales and debt servicing costs, to a surplus in its annual fiscal blueprint, in order to rein in its huge public debt.
After pushing back the timeframe several times, the most recent pledge was to achieve a primary balance surplus by fiscal 2025 - with a caveat that the target will be reassessed given the economic pain caused by the COVID 19 pandemic. Kishida has repeatedly stated that while the government's near-term focus would be to boost spending to combat the pandemic, Japan must lay out a long-term plan to fix its tattered finances.